IFTA
What is IFTA (International Fuel Tax Agreement)?
IFTA, the International Fuel Tax Agreement, is the arrangement between the 48 contiguous US states and the 10 Canadian provinces that lets a motor carrier file one quarterly fuel tax return with its base jurisdiction instead of separate returns in every jurisdiction it drives in. The carrier reports miles driven and fuel bought in each jurisdiction, tax is owed where the fuel was burned (by miles) and credited where it was bought, and the base jurisdiction settles the differences with the others.
What a carrier has to keep
- A valid IFTA license and decal set for the base jurisdiction, on every qualified vehicle.
- Fuel receipts per purchase: date, gallons, price, and where it was bought.
- Miles per jurisdiction per quarter, from the fleet's own records: odometer logs, ELD reports or trip sheets.
- Quarterly filings on time, even in a quarter with no tax due.
Why the mileage records matter
The allocation is only as good as the mileage split. A carrier that cannot say which miles ran in which state gets the worst of both worlds: tax allocated by an estimate nobody chose, in an audit with nothing to argue from. Fuel data and mileage data arriving from the same trips, in the same system, is what makes the return a report rather than a reconstruction.