The International Fuel Tax Agreement (or IFTA) is an agreement between the lower 48 states of the United States and the Canadian provinces, to simplify the reporting of fuel use by motor carriers that operate in more than one jurisdiction.[1] Alaska, Hawaii, and the Canadian territories are not required to participate, however all of Canada and Alaska do. An operating carrier with IFTA receives an IFTA license and two decals for each qualifying vehicle it operates. The carrier files a quarterly fuel tax report. This report is used to determine the net tax or refund due and to redistribute taxes from collecting states to states that it is due.
This tax is required for motor vehicles used, designed, or maintained for transportation of persons or property and:
The Power Unit has two axles and a gross vehicle weight or registered gross vehicle weight in excess of 26,000 pounds, and/or
The Power Unit has three or more axles regardless of weight, and/or
Is used in combination, when the weight of such combination exceeds 26,000 pounds gross vehicle or registered gross vehicle weight.[2]
Exceptions exist for recreational vehicles such as motor homes, pickup trucks with attached campers, and buses when used exclusively for personal pleasure by an individual.[2] Some states have their own exemptions[3] that often apply to farm vehicles or government vehicles.
Prior to IFTA each state had its own fuel tax system and a truck needed tax permits for each state in which it operated. Most states established Ports of Entry to issue permits and enforce tax collection, which was burdensome to the trucking industry and the states. Pre-IFTA trucks in interstate commerce carried special plates ("Bingo Plates") upon which each state's permit sticker was affixed. This was inefficient and proved to be costly for each state to manage.
How it worksedit
Simply stated, IFTA works as a "pay now or pay later" system. As commercial motor vehicles buy fuel, any fuel taxes paid are credited to that licensee's account. At the end of the fiscal quarter, the licensee completes their fuel tax report, listing all miles traveled in all participating jurisdictions and lists all gallons purchased. Then the average fuel mileage is applied to the miles traveled to determine the tax liability to each jurisdiction. Three states—Kentucky, New Mexico, and New York—have "weight-mile" taxes in addition to the standard fuel tax. Oregon has just a weight-mile tax. Any amount of fuel taxes due (or refund) is then paid to (or received from) the base jurisdiction who issued the license. The member jurisdictions then take care of transferring the funds accordingly. Audits are conducted only by the base state and fuel bonds are rarely required.
Referencesedit
^Ministry of Finance, Ontario. Canada. International Fuel Tax Agreement. Retrieved on 26-08-2015.
international, fuel, agreement, this, article, uses, bare, urls, which, uninformative, vulnerable, link, please, consider, converting, them, full, citations, ensure, article, remains, verifiable, maintains, consistent, citation, style, several, templates, tool. This article uses bare URLs which are uninformative and vulnerable to link rot Please consider converting them to full citations to ensure the article remains verifiable and maintains a consistent citation style Several templates and tools are available to assist in formatting such as reFill documentation and Citation bot documentation September 2022 Learn how and when to remove this template message The International Fuel Tax Agreement or IFTA is an agreement between the lower 48 states of the United States and the Canadian provinces to simplify the reporting of fuel use by motor carriers that operate in more than one jurisdiction 1 Alaska Hawaii and the Canadian territories are not required to participate however all of Canada and Alaska do An operating carrier with IFTA receives an IFTA license and two decals for each qualifying vehicle it operates The carrier files a quarterly fuel tax report This report is used to determine the net tax or refund due and to redistribute taxes from collecting states to states that it is due This tax is required for motor vehicles used designed or maintained for transportation of persons or property and The Power Unit has two axles and a gross vehicle weight or registered gross vehicle weight in excess of 26 000 pounds and or The Power Unit has three or more axles regardless of weight and or Is used in combination when the weight of such combination exceeds 26 000 pounds gross vehicle or registered gross vehicle weight 2 Exceptions exist for recreational vehicles such as motor homes pickup trucks with attached campers and buses when used exclusively for personal pleasure by an individual 2 Some states have their own exemptions 3 that often apply to farm vehicles or government vehicles Contents 1 Promulgation 2 How it works 3 References 4 External linksPromulgation editPrior to IFTA each state had its own fuel tax system and a truck needed tax permits for each state in which it operated Most states established Ports of Entry to issue permits and enforce tax collection which was burdensome to the trucking industry and the states Pre IFTA trucks in interstate commerce carried special plates Bingo Plates upon which each state s permit sticker was affixed This was inefficient and proved to be costly for each state to manage How it works editSimply stated IFTA works as a pay now or pay later system As commercial motor vehicles buy fuel any fuel taxes paid are credited to that licensee s account At the end of the fiscal quarter the licensee completes their fuel tax report listing all miles traveled in all participating jurisdictions and lists all gallons purchased Then the average fuel mileage is applied to the miles traveled to determine the tax liability to each jurisdiction Three states Kentucky New Mexico and New York have weight mile taxes in addition to the standard fuel tax Oregon has just a weight mile tax Any amount of fuel taxes due or refund is then paid to or received from the base jurisdiction who issued the license The member jurisdictions then take care of transferring the funds accordingly Audits are conducted only by the base state and fuel bonds are rarely required References edit Ministry of Finance Ontario Canada International Fuel Tax Agreement Retrieved on 26 08 2015 a b http www iftach org manuals 2010 AA Articles 20of 20Agreement 20FINAL 20 20January 202010 pdf bare URL PDF http www iftach org exempt view general phpExternal links editOfficial website nbsp Retrieved from https en wikipedia org w index php title International Fuel Tax Agreement amp oldid 1112438923, wikipedia, wiki, book, books, library,
