IFTA (International Fuel Tax Agreement) is a fuel tax cooperative among the 48 contiguous U.S. states and Canadian provinces. Commercial motor vehicles with a gross vehicle weight rating exceeding 26,000 lbs or operating with three or more axles crossing state lines must file IFTA quarterly returns reporting total miles by state and total fuel purchases, then pay or receive credit based on each state's per-gallon tax rate.
What IFTA is and how it works
Before IFTA (established 1983), interstate trucks bought a fuel permit at each state line. IFTA lets you file once with your base state, which then distributes taxes to every state you ran in.
You register in your home state, receive one IFTA license and decals for each truck. Every quarter, submit total miles by state and total gallons purchased. Your base state calculates the net tax due or credit and settles with the other states.
Who needs an IFTA license
Any vehicle crossing state or provincial borders that meets one of these: two axles + GVW over 26,000 lbs, three or more axles regardless of weight, or a combination weighing over 26,000 lbs.
Intrastate-only operators (never crossing state lines) are exempt. Vehicles under 26,000 lbs GVWR are also exempt from IFTA — but not from state fuel tax, which is paid at the pump.
How to calculate your tax liability
Step 1: Fleet MPG = total miles across all states ÷ total gallons purchased. Step 2: Taxable gallons per state = miles in that state ÷ fleet MPG. Step 3: For each state, compare taxable gallons to actual gallons purchased. Owed = (taxable − purchased) × state tax rate.
Example: You ran 1,200 miles in Illinois, fleet MPG is 6.5, so taxable gallons = 184.6. You purchased 200 gallons in IL. IL tax rate is $0.475/gal. You're owed a credit of (200 − 184.6) × $0.475 = $7.32.
Step-by-step quarterly filing
1) Pull ELD state-by-state mileage report for the quarter. 2) Collect fuel receipts, matching date/gallons/state. 3) Enter miles and gallons in your base state's IFTA portal. 4) Review the calculated tax and submit payment or credit request.
Modern ELDs (Motive, Samsara, Geotab) auto-generate IFTA-compliant mileage reports. Modern fuel cards (RTS, TCS, EFS) auto-export fuel-by-state.
How the quarterly return actually calculates
IFTA reconciles fuel tax you paid at the pump against fuel tax you owed based on miles driven per state. If you paid too much in a high-tax state (California, Pennsylvania) and drove miles in a low-tax state (Oklahoma, Missouri), you get a refund. Reversed, you owe.
Formula per state: (state miles ÷ total miles) × total gallons burned = taxable gallons. Multiply by state's tax rate, subtract tax already paid at the pump in that state, and you have the balance due or refund per jurisdiction. Your ELD should export this by state automatically.
The three IFTA audit triggers to avoid
MPG outside 5.0–8.0 range: an ELD reporting 12 MPG on a Class 8 sleeper triggers an automatic review. Missing fuel receipts: the state can disallow untaxed gallons and rebill you at the highest jurisdictional rate. State-mileage discrepancy between IFTA and the base state's IRP report — those two reports get cross-checked and mismatches surface within one filing cycle.
Keep fuel receipts (paper or Fleet Card export) for 4 years, and reconcile ELD miles to IFTA miles monthly, not quarterly. Fixing an error in month 1 is easy; fixing it in month 11 during an audit is not.
Frequently asked questions
What happens if I miss the IFTA filing deadline?
Late penalty of $50 or 10% of net tax due (whichever is greater), plus daily interest on the balance.
How long should I keep IFTA records?
Four years from filing date. Keep mileage logs, GPS/ELD data, and fuel receipts organized by quarter.
Can I file IFTA if I didn't run any miles?
Yes. If authority was active but you had no operations, file a 'zero report' to keep your license active.
Who does IFTA audits?
Your base state's Department of Revenue or Transportation. Audits typically cover 3 years of returns and take 60–90 days.