Best Practice Guide for IFTA Decal Recordkeeping
No one likes to receive notice of an IFTA audit. The International Fuel Tax Agreement (IFTA) is for motor carriers operating in interstate commerce (crossing state lines) with a combined gross vehicle weight rating (GVWR) over 26,000 pounds. The agreement allows for the tax paid on fuel to be appropriately distributed to the states where mileage was traveled. Taxes owed or refunds paid will be handled by your base state to simplify filings. Each year, upon renewal of your IFTA account, you will receive two IFTA Decals to be placed on each side of the truck. A copy of the IFTA license must be kept in the cab of the truck. Each year, IFTA changes the color of the decal to help officers quickly spot if the carrier’s IFTA license is current. Many states are cracking down on the ability to order additional IFTA Decals at renewal and replacement requests throughout the year. For this reason, we are sharing our best practices for IFTA Decal recordkeeping and a recordkeeping form for ease of tracking. This is not a requirement of IFTA but a best practice we recommend in order to avoid issues in an audit.
Upon receipt of your IFTA Decals for a given period, it is important that you document the information received as you will be required to answer certain questions pertaining to the decals in the event that your company is selected for audit. See our IFTA Decal Recordkeeping Best Practice Guide for a list of example questions an auditor could ask. This information should be kept on file for the statute period of 4 years from the date of the license period filed. If a replacement decal is requested, in addition to the information you would track for renewal decals, you should also notate the reason for the additional decal request. If the reason is simply adding vehicles to the fleet, no further action would be necessary. You can use this form to help in tracking information related to IFTA decals. Read more on how to handle the removal of decals or unused decals by downloading our FREE best practice guide here.