In 2019 some states and provinces had changes in their IFTA fuel tax rates causing a split rate for the effected quarters. Two of those were Alberta—the Canadian province—and the state of Alabama.
The Alberta Treasury Board and Finance, Tax and Revenue Administration (TRA), had a tax rate change for the 2nd quarter of 2019, which went into effect on May 30, 2019. Since the change fell in the middle of the quarter, Alberta will have a split rate for this quarter.
The Alberta Tax and Revenue Administration has requested that all jurisdictions honor this rate correction for the 2nd quarter fuel taxes.
The State of Alabama will also have a split rate, but during the 3rd quarter of 2019. Legislation was recently passed incorporating the tax rate change, which will go into effect September 1, 2019.
IFTA Tax Rates for 2019
What are the 2019 IFTA tax rates for the 3rd quarter?
The International Fuel Tax Association (IFTA) has released the fuel tax rates for the 3rd quarter of 2019. You can download the full list of 2019 Q3 tax rates below.
You can also find more information on the International Fuel Tax Association website.
Which states had IFTA tax rate changes?
There were seven states that showed a tax rate change, including Maryland, Montana, Nebraska, Ohio, Rhode Island, Tennessee and Virginia. IFTA lists the 3rd Quarter 2019 Tax Rate Changes, which will go into effect on July 1, 2019.
When are your IFTA taxes due?
The IFTA return due date for the 2nd quarter is July 31st. Take a look below for a list of IFTA fuel tax reporting for the each quarter.
- 1st quarter (January to March) — April 30
- 2nd quarter (April to June) — July 31
- 3rd quarter (July to September) — October 31
- 4th quarter (October to December) — January 31
With all of the IFTA and IRP audits, Compliance Navigation Specialists, Adam Galante and Chris Kiehl, talk about Electronic Record Keeping Requirements to stay compliant.
This Memorandum is being issued by IFTA (International Fuel Tax Association) in an effort to clarify the grace period. The IFTA Articles of Agreement, Section R655 provides:
R655 GRACE PERIOD
.100 Carriers from new member jurisdictions shall be allowed a two-month grace period from the date of the new member’s IFTA program implementation to display the IFTA license and decals. However, carriers must maintain the proper credentials for traveling in member jurisdictions until they display the valid IFTA license and decals.
.200 Carriers renewing their IFTA license and decals have a two-month grace period (January and February) to display the renewal IFTA license and decals. To operate in IFTA jurisdictions during this grace period, carriers must display either valid current or prior year IFTA license and decals from the jurisdiction in which they were operating or a valid single-trip permit from the IFTA jurisdiction in which they are operating.
Because there are no new member jurisdictions implementing the IFTA in 2018, R655.200 above is the applicable language for the grace period in 2019.
Carriers must display one or more of the following to travel through IFTA member jurisdictions for the first two months of 2019.
1) A valid 2019 IFTA license and two IFTA decals issued by an IFTA member jurisdiction.
2) A valid 2018 IFTA license and two IFTA decals from an IFTA member jurisdiction (if a renewal application has been filed for 2019); or
3) A valid trip permit issued by the IFTA member jurisdiction through which they are operating.
Please be advised that IFTA License Renewals for 2019 MUST BE FILED WITH YOUR BASE JURISDICTION BEFORE THE END OF 2018. The two-month grace period is for display of renewal credentials, not to file your renewal application for those credentials (See R655.200 above).
In order to have a seamless operation into the new calendar year, we encourage you to file your renewal
application with your base jurisdiction well before December 31, 2018.
R630 of the IFTA Articles of Agreement provides:
Carriers renewing credentials may operate with the IFTA decals and license two months prior to the effective date shown on the credentials. However, those carriers are responsible for filing a fourth quarter report for the year preceding the effective date of the new credentials, including all operations for that quarter.
If you need help obtaining your IFTA sticker Contact Us Today!
Have you ever been through an IFTA audit? If you haven’t been through one, would you be stressed if you received a call or a letter stating you are due for one?
I have been in many clients’ IFTA audits. If you are keeping accurate mileage and fuel receipts, you have nothing to worry about. But sometimes that is easier said than done. I have had new clients contract with Compliance Navigation Specialists (CNS) to complete a mock audit or represent them in an actual audit and have come across some common problems. Below were some of the more frequent challenges and how to avoid them:
- The first common problem I come across has to do with fuel receipts. It’s important to know that drivers must provide documentation proving the miles they ran, as well as the fuel purchased. Often times drivers are either missing fuel receipts or using a credit card that doesn’t show gallons purchased. I have even witnessed a client bringing their fuel receipts down from their attic and open up the box to find that the heat erased the ink on the thermal receipts. All of these issues cause challenges in an IFTA audit and can be prevented. I recommend getting a fuel card to keep accurate records of fuel purchased per gallon per truck.
- When it comes to miles, the main problems I see are missing trip sheets, inaccurate mileage recorded by the driver, or inaccurate mileage for a GPS system. Drivers are responsible to make sure their GPS is reading the odometer mileage and working consistently. It’s good practice to test the GPS system periodically to make sure it is working properly. If the GPS system fails for any reason, the driver must recreate their trips to complete their taxes.
- Drivers are required to keep supporting records and documents for four years from the tax return due date or filing date, whichever is later, plus any time period included as a result of waivers or jeopardy assessments. If a driver is reporting their IFTA taxes wrong or is just bad at record keeping, they could get hit with back taxes and interest. As an example, if a driver is bad at record keeping and can’t prove their mileage, the state has the right to calculate their miles per gallon by 4.0 mpg. This can cause serious back taxes, plus interest. In Pennsylvania, a trucker challenged the 4.0 mpg factor in Nedeljko Gunjak, Inc. v. Commonwealth, docket no. 455 F.R. 2013. The Pennsylvania Commonwealth Court has denied the appeal of a motor carrier’s assessment for additional fuel use tax that was more than $300,000 under the International Fuel Tax Agreement. Due to the carrier’s absence of records that IFTA requires a motor carrier to keep, the state, following an audit, had imposed a 4.0 miles-per-gallon factor on all the carrier’s operations, and made such other audit adjustments as were warranted by the best information available. The taxpayer’s argument was that they presented the required records. PA court said that the records the carrier had shared were so obviously inaccurate as to preclude any reliance.While this finding is by no means novel, it is a good time emphasize how important it will be when a carrier faces an IFTA audit that its records be reasonably complete and accurate. At CNS, we have several tools and management processes to keep you in compliance with IFTA, so if you do get notified of an IFTA audit you will not have to worry. For additional information about CNS’ IFTA audit services visit www.cnsprotects.com/ifta-audit/ or email us at email@example.com.
Contributed by John Irwin, CNS CEO