Running loads across state lines means keeping up with more than just miles and fuel receipts. Qualified motor carriers also have to account for fuel taxes in the jurisdictions where they operate. IFTA, or the International Fuel Tax Agreement, provides a way to report those taxes through the carrier’s base jurisdiction on a quarterly return, rather than filing separately in each jurisdiction.
Key Takeaways
- IFTA stands for International Fuel Tax Agreement.
- It generally applies to qualified motor vehicles operating in two or more IFTA jurisdictions.
- Carriers track miles traveled and fuel purchased during each quarter.
- IFTA returns are filed through the carrier’s base jurisdiction.
- The calculation considers miles, fuel use, fuel purchases, and applicable tax rates.
- IFTA covers fuel taxes, while IRP covers apportioned vehicle registration.
What Is IFTA In Trucking?
IFTA, short for the International Fuel Tax Agreement, is the system qualified carriers use to account for fuel taxes when they travel across participating jurisdictions.
It applies across the 48 contiguous U.S. states and 10 Canadian provinces.
Say a Texas carrier makes regular runs through Oklahoma, Arkansas, and Louisiana. During the quarter, it tracks the miles driven and fuel purchased in each jurisdiction. Those numbers are used when the carrier prepares its IFTA return.
The key point: IFTA doesn’t mean you stop paying fuel taxes. It provides carriers with a standard way to account for taxes due in the jurisdictions where they operate.
Who Needs An IFTA License?
Not every truck needs an IFTA license.
A qualified motor vehicle generally:
- Has two axles and exceeds 26,000 pounds gross or registered gross weight
- Has three or more axles, regardless of weight
- Is part of a combination exceeding 26,000 pounds gross or registered gross weight
The vehicle must also operate in two or more IFTA member jurisdictions for IFTA generally to apply. IFTA, Inc. provides the official carrier requirements
Your base jurisdiction is generally where your qualified vehicles are registered, where some travel occurs, and where your operational control and records are maintained or available. That’s where you apply for your IFTA license and file your returns.
How Does IFTA Work?
The process is based on two types of information: where your trucks traveled and where they bought fuel.
1. Get An IFTA License
If your operation qualifies, apply through your base jurisdiction. You’ll receive the IFTA credentials and decals required for your qualified vehicles.
2. Track Miles By Jurisdiction
Keep records of the miles each vehicle travels in every jurisdiction during the quarter. ELD data, GPS records, trip reports, odometer readings, and other accepted records may help support your mileage.
Don’t wait until the filing deadline to reconstruct your trips. Missing mileage is much harder to resolve months later.
3. Record Fuel Purchases
Keep fuel records showing information such as the purchase date, location, gallons, fuel type, and other details required by your jurisdiction.
Your mileage records and fuel records work together. Both are needed to support the IFTA calculation.
4. Calculate The Fuel Tax
Here’s a simplified example.
A truck travels 10,000 miles and uses 1,500 gallons during a quarter:
10,000 ÷ 1,500 = 6.67 miles per gallon
That average fuel mileage is used to determine the gallons attributable to the miles traveled in each jurisdiction. The carrier then compares the fuel tax associated with those miles with the tax already paid on qualifying fuel purchases.
The actual calculation uses the applicable tax rate and IFTA rules for each jurisdiction. Rates can change, so use the rate for the quarter you’re reporting. IFTA publishes quarterly tax-rate information.
5. File The Quarterly Return
At the end of the quarter, the carrier reports its mileage, fuel purchases, fuel use, and tax calculations on its IFTA return. The return goes to the base jurisdiction, which handles the tax distribution among participating jurisdictions.
IFTA vs. IRP
IFTA and IRP often come up together, but they serve different purposes.
| IFTA | IRP |
| Fuel tax reporting | Apportioned vehicle registration |
| Tracks miles and fuel use | Determines apportioned registration fees |
| Quarterly fuel-tax reporting | Registration and renewal requirements |
An interstate carrier may need both. IFTA is about fuel taxes. IRP is about vehicle registration.
What Records Should You Keep?
Your records should support the numbers reported on your IFTA return.
Depending on your jurisdiction, this may include:
- Total and jurisdiction-specific miles
- Fuel purchases and gallons
- Fuel purchase dates and locations
- Fuel type
- Vehicle identification
- Trip, ELD, GPS, or odometer records
Your base jurisdiction determines the specific records you must maintain.
Common IFTA Mistakes
- Waiting until filing time. Missing receipts and mileage information are difficult to recover months later.
- Using an outdated tax rate. IFTA rates can change by quarter, so use the rate that applies to the reporting period.
- Reporting unsupported mileage. Your reported miles should match your underlying trip and vehicle records.
- Losing fuel documentation. Missing records can make it difficult to support fuel purchases reported on the return.
- Confusing IFTA with IRP. They are separate requirements with different purposes.
IFTA Registration Process: Where To Start
Then apply for the appropriate IFTA credentials and set up a system for tracking mileage and fuel purchases. Doing this before your first quarterly filing gives you time to correct recordkeeping problems before they become compliance issues.
Get Help With Your IFTA Reporting
If you don’t want to manage the calculations and paperwork yourself, Aspire DOT Services can help with IFTA filing services, including fuel-tax calculations, mileage tracking, quarterly filing, and related support.
Frequently Asked Questions
1. How often do you file IFTA?
IFTA returns are filed quarterly through the carrier’s base jurisdiction. Filing requirements and deadlines come from that jurisdiction.
2. Is IFTA required for every truck?
No. IFTA generally applies to qualified motor vehicles operating in two or more member jurisdictions—vehicle configuration, weight, and where the vehicle operates all matter.
3. What if I only drive within one state?
IFTA generally doesn’t apply when a qualified vehicle operates only within one jurisdiction. Other state fuel-tax or operating requirements may still apply.
4. Can someone else handle my IFTA filing?
Yes. A carrier can generally authorize a qualified tax professional or filing service to handle IFTA returns on its behalf. However, the carrier remains responsible for providing accurate mileage and fuel records and meeting applicable filing requirements and deadlines.
