The records carriers keep are the secret of a painless and penalty-free audit. A system that accurately records distance traveled by unit by jurisdiction protects the interstate carrier from additional assessments at audit and avoids potential license revocation for noncompliance.
Summary of requirements
International Fuel Tax Agreement (IFTA) and International Registration Plan (IRP) have similar recordkeeping requirements and the jurisdictions often conduct joint audits. Being aware of and complying with these requirements will result in easier and less costly audits.
IMVRs. A recommended source document under IFTA and IRP is an “Individual Vehicle Mileage Record” (IVMR) (or individual vehicle distance record [IVDR]). IVMRs can be created using a paper form or may be created using an electronic logging system/device (ELD) or global positioning system (GPS).
If an IVMR is captured on paper, it must include:
- The beginning and ending dates of the trip to which the records pertain;
- Trip origin and destination;
- Route of travel;
- Beginning and ending reading from the odometer, hubometer, engine control module (EMC), or similar device for the trip;
- Total trip miles or kilometers;
- Miles/kilometers by jurisdiction; and
- Unit number or vehicle identification number.
Electronic records. Distance records produced wholly or partly by a vehicle-tracking system, including a system based on a GPS, must contain additional details, based on when the miles are accrued:
| Prior to January 1, 2024 | Beginning January 1, 2024 |
|---|
Records produced wholly or partly by a vehicle-tracking system, including a system based on a GPS, must include:
1. Original GPS or other location data for the vehicle to which the records pertain;
2. Date and time of each GPS or other system reading;
3. Location of each GPS or other system reading;
4. Beginning and ending reading from the odometer, hubodometer, engine control module (ECM), or any similar device for the period to which the records pertain;
5. Calculated distance between each GPS or other system reading;
6. Route of the vehicle’s travel;
7. Total distance traveled by the vehicle;
8. Distance traveled in each jurisdiction; and
9. Vehicle identification number or vehicle unit number. | When the vehicle’s engine is on, the vehicle-tracking system that utilizes latitudes and longitudes must create and maintain a record at a minimum of:
- Every 15 minutes for IRP, and
- Every 10 minutes for IFTA.
Records must contain the following elements:
1. Vehicle identification number or vehicle unit number,
2. Date and time of each system reading,
3. Latitude and longitude to include a minimum of 4 decimal places (0.0001) of each system reading, and
4. Odometer reading from the ECM of each system reading. If no ECM odometer is available, a beginning and ending dashboard odometer or hubometer for the trip is acceptable.
The data must be accessible in an electronic spreadsheet format such as XLS, XLSX, CSV, or Delimited text file. |
IVMRs should be accurately and legibly prepared. Both IFTA and IRP require reported distance for the actual routes traveled by each vehicle for each trip. When recording the mileage of an apportioned vehicle all movement, interstate and intrastate, must be included, as well as loaded, empty, dead-head and/or bobtail miles or kilometers.
Monthly, quarterly, and yearly summaries are prepared from the IVMR information. Computer summaries are not acceptable at face value and must always be supported by IVMRs or original ELD/GPS data during an audit.
Fuel records. IFTA licensees are required to maintain complete records of all motor fuel purchased, received, or used in the conduct of their business, and on request, produce these records for audit. The records must be adequate for the auditor to verify the total amount of fuel placed into the licensee’s qualified motor vehicles, by fuel type.
Retail fuel purchases and bulk fuel purchases must be accounted for separately.
In general, the jurisdictions will not accept for purposes of allowing tax-paid credit, any fuel record that has been altered, indicates erasures, or is illegible, unless the licensee can demonstrate that the record is valid.
Licensees cannot claim tax-paid credit for any fuel placed into a vehicle other than a qualified motor vehicle.
Tax paid retail fuel purchases. In order to claim tax-paid fuel credit on the IFTA return, an IFTA licensees must retain:
- A receipt, invoice, or transaction listing from the seller;
- A credit-card receipt;
- A transaction listing generated by a third party; or
- An electronic or digital record of an original receipt or invoice.
For tax-paid credit, a valid retail receipt, invoice, or transaction listing must contain:
- Date of the fuel purchase;
- Name and address of the seller of the fuel (a vendor code, properly identified, is acceptable for this purpose);
- Quantity of fuel purchased;
- Type of fuel purchased;
- Price of the fuel per gallon or per liter, or the total price of the fuel purchased;
- Identification of the qualified motor vehicle into which the fuel was placed; and
- Name of the purchaser of the fuel (where the qualified motor vehicle being fueled is subject to a lease, the name of either the lessor or lessee is acceptable for this purpose, provided a legal connection can be made between the purchaser named and the licensee)
Bulk fuel purchases. IFTA licensees must retain the following records for its bulk storage facilities:
- Receipts for all deliveries;
- Quarterly inventory reconciliations for each tank;
- The capacity of each tank; and
- Bulk withdrawal records for every bulk tank at each location.
In order to obtain tax-paid fuel credit on the IFTA return, IFTA licensees that maintain bulk storage must keep records that show:
- The purchase price of the fuel delivered into the bulk storage includes tax paid to the member jurisdiction where the bulk storage is located; or
- That the licensee has paid fuel tax to the member jurisdiction where the bulk storage is located.
IFTA licensees must keep the following records that contain the following elements for each withdrawal from its bulk storage facilities:
- Location of the bulk storage from which the withdrawal was made;
- Date of the withdrawal;
- Quantity of fuel withdrawn;
- Type of fuel withdrawn; and
- Identification of the vehicle or equipment into which the fuel was placed.
How long must records be retained? IRP requires the licensee to preserve the records their apportioned registration application is based upon for the current application year, plus the three preceding mileage years. Note that depending on when a carrier renews for IRP, distance data may need to be kept for more than a three-year period. The recordkeeping time-frame may actually end up being up to six and one-half years. For this reason, it is highly recommended to keep all distance and fuel data for six and one-half years.
IFTA requires the records used for the quarterly tax return to be retained for four years from the return due date or filing date, whichever is later, plus any time period included as a result of waivers or jeopardy assessments. If a licensee fails to provide the required records for audit, the four-year retention requirement is extended until the required records are provided.
