For trucking companies operating across state lines, keeping track of fuel usage and tax rates can be complex and time-consuming. That’s where the International Fuel Tax Agreement (IFTA) comes in. This agreement between the 48 contiguous states and 10 Canadian provinces allows trucking companies to file a single fuel tax report instead of multiple reports for each state they operate in. However, IFTA filing has its challenges, and trucking companies need to understand the process and requirements to avoid penalties and fines. This article will explore the basics of IFTA filing and how TMS-Digital can help simplify the process.
What is IFTA?
The International Fuel Tax Agreement (IFTA) between the 48 contiguous United States and 10 Canadian provinces simplifies fuel tax reporting for interstate trucking companies. Instead of filing separate fuel tax reports for each state or province, trucking companies can file a single report through their base jurisdiction. The base jurisdiction is the state or province where the company has registered its vehicles and where they report its mileage and fuel usage. The fuel tax collected by the base jurisdiction is then distributed to the other states and provinces based on the mileage traveled in each jurisdiction.
When is the IFTA filing due?
IFTA filing is due four times a year, on the last day of the month following the end of each calendar quarter. For example, the year’s first quarter ends on March 31, so IFTA filing for that quarter is due April 30. The second quarter ends on June 30, so IFTA filing for that quarter is due July 31. The third quarter ends on September 30, so IFTA filing for that quarter is due on October 31. Finally, the fourth quarter ends on December 31, so IFTA filing for that quarter is due on January 31.
What information is required for IFTA filing?
To complete an IFTA tax return, trucking companies need to provide several pieces of information:
- Total miles traveled per jurisdiction
- Total gallons of fuel consumed per jurisdiction
- Total tax-paid gallons of fuel purchased per jurisdiction
- Current tax rate per jurisdiction
In addition to these essential pieces of information, other requirements may be based on the jurisdiction in question. For example, some jurisdictions require trip sheets, while others require additional documentation related to fuel purchases.
How can TMS-Digital help with IFTA filing?
TMS-Digital is a transportation management system (TMS) that can help trucking companies streamline operations and simplify the IFTA filing process. With TMS-Digital, trucking companies can easily track fuel usage and mileage by jurisdiction, generate fuel tax reports, and stay up-to-date on current tax rates.
One of the key features of TMS-Digital IFTA Manager is its ability to calculate mileage by jurisdiction automatically. This means that trucking companies don’t have to track their mileage in each state or province manually – the system does it for them. It also tracks fuel usage by jurisdiction, making it easy to calculate tax-paid gallons and generate IFTA reports.
Another benefit of IFTA Manager is its ability to integrate with other systems and platforms. For example, the system can automatically import fuel purchase data from fuel card providers, eliminating the need for manual data entry. IFTA Manager also integrates with most of your favorite ELDs and can integrate with multiple ELDs to automatically import your vehicle’s mileage and break out miles driven in each state.
IFTA filing is an essential process that trucking companies must complete four times yearly to avoid penalties and fines. While IFTA filing can be complex and time-consuming, TMS-Digital can help simplify the process and save companies time and money. If you’re a trucking company that wants to streamline the IFTA filing process and save time and money, consider using TMS-Digital. With features like automated mileage tracking, fuel usage tracking, and integration with other systems, IFTA Manager can help streamline your operations and ensure compliance with IFTA regulations. Contact us today to learn more and schedule a demo.