Did you claim your fuel tax breaks?
In the past two years, several states and provinces offeredfuel tax holidays to lower costs for motor carriers. Carriers licensed with the International Fuel Tax Association (IFTA) and traveling in these jurisdictions saw reduced tax rates. Since the tax breaks apply only to certain types of fuel and for various time periods, filing quarterly returns became more complex than ever. Taking time to sort out the details can maximize the benefit to your bottom line.
Did you operate in these states or provinces?
Jurisdictions offering fuel tax holidays for varying time periods include:
- Alberta,
- Connecticut,
- Florida,
- Georgia,
- Maryland,
- New York, and
- Newfoundland Labrador.
Sorting out the details: What to pay and when
IFTA returns must still be filed for the quarters that include tax holidays. All miles traveled and fuel purchases must be reported on IFTA returns to accurately reflect miles per gallon (mpg) for the period.
To maximize your savings from the tax holidays:
- Claim the correct/reduced rate,
- For the miles traveled in affected states,
- For the correct reporting period/quarter.
Visit iftach.org for a handy tax holiday chart showing the dates and reduced fuel rates by jurisdiction.
The process to report the gallons with reduced tax rates varies by jurisdiction. Contact your base state or province with specific questions about reporting for your operations during these tax holidays.
Finally, remember to maintain all mileage and fuel records to support filed IFTA returns.
Check out “Recordkeeping for IRP and IFTA compliance” for details on recordkeeping under these programs. |
Key to remember: To maximize your fuel tax break, identify all miles traveled in affected states during tax holidays and remember to claim the reduced rates for those quarters.