How to File Your IFTA Quarterly Reports

The International Fuel Tax Agreement (IFTA) ensures fuel taxes are accurately paid to the states or provinces where fuel was consumed, rather than where it was purchased. This system helps distribute fuel tax revenues among member jurisdictions, which are often used to fund transportation infrastructure.

Understanding IFTA Reporting Fundamentals

IFTA applies to qualified motor vehicles operating in two or more IFTA member jurisdictions. A qualified motor vehicle is defined as one used for transporting persons or property, having two axles with a gross vehicle weight or registered gross vehicle weight exceeding 26,000 pounds (11,797 kilograms), or having three or more axles regardless of weight. Vehicles used in combination that exceed 26,000 pounds also fall under this definition.

IFTA reports are due quarterly, with specific deadlines established for each reporting period. For instance, the first quarter (January-March) reports are due by April 30, the second quarter (April-June) by July 31, the third quarter (July-September) by October 31, and the fourth quarter (October-December) by January 31 of the following year. If a due date falls on a weekend or holiday, the deadline is extended to the next business day.

The IFTA agreement includes the 48 contiguous U.S. states and 10 Canadian provinces. Jurisdictions not part of IFTA include Alaska, Hawaii, the District of Columbia, and the Canadian territories of Northwest Territories, Nunavut, and Yukon. Motor carriers must obtain an IFTA license from their “base jurisdiction,” which is where their qualified motor vehicles are registered, operational control and records are maintained, and some travel occurs.

IFTA’s fundamental principle is that fuel taxes are paid to the jurisdiction where fuel was consumed, not where it was purchased. When fuel is purchased, taxes paid are credited to the licensee’s account. At the end of each quarter, the carrier reports all miles traveled and fuel purchased in all participating jurisdictions. The base jurisdiction collects and distributes appropriate fuel taxes to other member jurisdictions, simplifying compliance for carriers who frequently cross state or provincial lines.

Essential Data for IFTA Reporting

Accurate and consistent data collection is essential for IFTA reporting. Two primary categories of information are necessary: mileage data and fuel purchase data. Without this detailed information, calculating fuel tax liability across multiple jurisdictions becomes challenging.

For mileage data, carriers must track the total miles traveled by each qualified vehicle within every jurisdiction. This includes both loaded and empty miles. Methods for precise mileage tracking include electronic logging devices (ELDs), GPS systems, and regular odometer readings. Maintaining daily logs that detail trip origins, destinations, routes traveled, and corresponding mileage for each jurisdiction helps ensure accuracy.

Fuel purchase data requires careful record-keeping of every fuel transaction for each qualified vehicle. For each purchase, documentation must include the date of purchase, location (jurisdiction), fuel type, number of gallons purchased, and price per gallon. Retaining physical or electronic fuel receipts is important, as these serve as proof of tax-paid purchases.

Establishing a system, whether digital or paper-based, for organizing daily logs and fuel receipts helps. These records must be readily available and maintained for a minimum of four years from the report due date or filing date, whichever is later, to support potential audits by the base jurisdiction. Maintaining accurate vehicle identification numbers (VINs) and unit numbers for each vehicle in the fleet ensures proper attribution of mileage and fuel consumption.

Calculating Your IFTA Report

Once essential mileage and fuel purchase data are collected, calculations determine the net fuel tax liability or refund. This process transforms raw data into the figures required for the quarterly report.

The initial step involves calculating the overall Miles Per Gallon (MPG) for the reporting period. This is determined by dividing the total miles traveled across all jurisdictions by the total gallons of fuel purchased across all jurisdictions for the entire fleet or individual vehicles.

Fuel consumed in each jurisdiction is determined by multiplying the miles traveled within a particular jurisdiction by the overall MPG calculated previously. This calculation provides the estimated quantity of fuel used within that jurisdiction.

The gross tax due for each jurisdiction is calculated by applying the jurisdiction-specific fuel tax rates to the estimated fuel consumed. Each state and province sets its own fuel tax rate, which can vary by fuel type (e.g., gasoline, diesel). These rates are subject to change quarterly and can be obtained from the base jurisdiction’s motor vehicle department or IFTA Inc.’s official website.

After calculating gross tax, the amount of tax already paid on fuel purchased within each jurisdiction is accounted for by multiplying the gallons of fuel purchased in a jurisdiction by that jurisdiction’s fuel tax rate. This figure represents a credit against the gross tax due.

The net tax due or refund for each jurisdiction is determined by subtracting the tax-paid amounts from the gross tax due. These individual jurisdictional net amounts are then summed to arrive at the total net tax due to, or refund from, the base jurisdiction. Tools such as spreadsheets or specialized IFTA software can assist in performing these calculations accurately.

Submitting Your IFTA Quarterly Report

After data is gathered and calculations completed, the final step involves preparing and submitting the IFTA quarterly report. This process focuses on filing with your base jurisdiction.

Carriers access the official IFTA report form through their base jurisdiction’s motor vehicle or revenue department website, or via an online portal. These forms are designed to accept the summarized mileage, fuel consumption, and tax due/refund amounts. Transfer these figures precisely onto the form, ensuring all entries are correct to avoid discrepancies.

Submission methods include online portals or mail. Electronic filing through an online portal is the preferred method, as it provides immediate confirmation of submission and can streamline payment processes. If mailing a physical form, use a method that provides proof of mailing, such as certified mail, to ensure timely receipt.

When a net tax amount is due, payment can be made online through the jurisdiction’s portal using electronic payment options. Alternatively, some jurisdictions accept checks sent via mail. If a refund is due, the base jurisdiction will process it, though the timeline for receiving refunds can vary.

Adhering to the quarterly deadlines is important to avoid penalties and interest charges. Late filing can result in a penalty, $50 or 10% of the net tax liability (whichever is greater), in addition to accrued interest on the unpaid tax. Failure to file or pay on time can lead to license suspension. After submission, retain copies of the filed reports and all supporting documentation for at least four years, as these records may be required for future audits.