IFTA reporting is a standardized system designed to simplify and streamline the process of fuel tax
reporting for motor carriers operating across various U.S. states and Canadian provinces. Participating
carriers must maintain detailed records of fuel purchases and miles traveled in each jurisdiction
during quarterly reporting periods. They calculate their fuel tax liability by multiplying the miles
traveled by the applicable tax rates set by individual jurisdictions. The information is then consolidated
into an IFTA Quarterly Fuel Tax Report, submitted to the carrier's base jurisdiction. Carriers make a single payment to the base jurisdiction, which distributes
the funds to the relevant jurisdictions. Compliance is crucial to avoid penalties, and many carriers use
online filing systems or third-party services to facilitate the reporting process. Regular audits help
ensure accuracy and adherence to IFTA regulations.