What is IFTA & Who Needs It?
IFTA stands for International Fuel Tax Agreement. IFTA provides a uniform means for a carrier to file for their quarterly fuel taxes all at once, regardless of how many tax jurisdictions they operated in during the previous quarter.
The IFTA agreement states that you will pay the fuel taxes on any mileage driven in that state. Since these taxes are based on mileage they apply even if you did not purchase fuel in that state. The IFTA license is issued per EIN Number and must be printed and placed in the cab of the vehicle(s). You are issued an IFTA license and one set of IFTA decals per truck, which will allow you to operate in all other IFTA jurisdictions.
An IFTA license is required for any commercial vehicles crossing state lines with a GVW over 26,000 lbs. If you are only expecting to leave your base state occasionally, you can avoid getting a full IFTA License by opting for temporary fuel permits for each state you expect to travel in. However, if you are expecting to cross state lines frequently (some states define this as more than 5 times a year), you should file for a full IFTA License.
State agencies can take from 1-14 days to complete the new account request. Each state has their own application or decal fees. They vary from $0 to $50. You will need to renew your IFTA license and decals each year in January. There is a one-month grace period. February 1st is when the Department of Transportation will begin issuing fines to carriers for not renewing.