IFTA v IRP

1. IFTA v IRP

2. Qualified Vehicles • (i) has two Axles and a gross Vehicle weight or registered gross Vehicle weight in excess of 26,000 pounds (11,793.401 kilograms), or • (ii) has three or more Axles, regardless of weight, or • (iii) is used in combination, when the gross Vehicle weight of such combination exceeds 26,000 pounds (11,793.401 kilograms).

3. Records Retention • IFTA • The licensee is required to preserve the records upon which the quarterly tax return or annual tax return is based for 4 years from the tax return due date or filing date, whichever is later. • IRP • The Base Jurisdiction shall require a Registrant to preserve all Operational Records on which the Registrant’s application for apportioned registration is based for a period of 3 years following the close of the Registration year.

4. Records (IFTA/IRP) • (i) Date of trip (starting and ending); • (ii) Trip origin and destination; • (iii) Route of travel (may be waived by Base Jurisdiction); • (iv) Beginning and ending odometer or hub odometer reading of the trip (may be waived by Base Jurisdiction); • (v) Total Distance; • (vi) In-Jurisdiction Distance; and • (vii) Power Unit Number or VIN

5. Additional Information-Records • (i) Fleet number; • (ii) Registrant’s name; • (iii) Trailer number; and • (iv) Driver’s signature and/or name. Note: All information do not need to be retained on the same documents.

6. Records (IFTA vs. IRP)… Differences in Record Keeping For IFTA, fuel records are required, OTR, bulk fuel withdrawals, etc. Records shall contain, but not limited to: • Date of each receipt of fuel • Name and address of the person from whom purchased or received • Number of gallons or liters received • Type of fuel; and • Vehicle or equipment into which fuel was placed

7. Other Source Documents: • If a carrier does not provide IVDRs (Individual Vehicle Driver Record), IVMRs (Individual Vehicle Mileage Record), Trip Reports, or Driver Logs, the following list reflects other source documents that could potentially be used to substantiate distance travel. In order to be considered “adequate” support, they must reflect the data required in Article 4 of the APM and Section P500 of the IFTA Procedures Manual; however, that data need not be contained on a single document. • Maintenance Records • Receiving Contracts • Bill of Ladings • Dispatch Reports • Settlement Sheets • Scale Tickets • Trip Permits • Over dimensional Load Permits • Computer Mileage Printouts • Fuel Receipts • Hotel Receipts • Phone Records

8. Distance/Fuel Reporting • Quarterly/annual tax reporting • Fuel purchased • Distance traveled • Taxes paid are based on the distance traveled and fuel purchased at the applicable jurisdiction tax rate. • Application for registration/renewals-Schedule B • Distance traveled during the reporting period; or • Use of estimated distance for non-traveled jurisdictions. • Apportioned fees are based on distance reported, vehicle weight, axles, etc. IFTA-Decals IRP-Apportioned Plates

9. Audits • IRP • 3% per year of the annual fleet renewals • No Stratification of Audits • Audit=1registration year • Multiple registration years (3) =3 audits • IFTA • 3% per year of active reported licensees • Stratification of Audits • 15% -Low Distance Accounts • 25% - High Distance Accounts • Audit=1registration year • Multiple registration years, fuel types=1 audit

10. Estimate vs. Actual • The carrier estimated miles for reporting; therefore, the auditor must determine reliability prior to making any adjustments. • Auditor must estimate miles for the audit as it is known that miles were missing. • The carrier estimated miles but the records show they had actual activity in this or all jurisdictions. • The carrier did not estimate or show actual miles but operated in that jurisdiction.

11. Estimate vs. Actual (cont)… • Why did the carrier estimate distances instead of using actual? • Was the carriers reasoning logical and grounded in any fact? • Some examples I have seen: • Miles based on billing address or delivery address. Used for Total and or Jurisdictional • Miles based on revenue produced in each jurisdiction. Used forTotal and or Jurisdictional • Distances based on fuel purchases. Used for Total and or Jurisdictional • Distances just estimated due to carrier “KNOWLEDGE”. Used for Total and/or Jurisdictional • Miles based on “KNOWN” unit MPG’s times the gallons purchased. Usually used on Total only and some other basis is used for Jurisdictional miles.

12. Estimate vs. Actual (cont)… Obviously, all of these sceneries will require some type of audit adjustment. Exactly what type of adjustment made will be based on your understanding of how the reported miles were determined. First, inquiries must be made as to the type of records available, but not utilized which may help to sort out these estimates and arrive at something which may be closer to the actual operation. Your Jurisdiction may allow for auditor judgment in these cases or may require that you fall back on your jurisdictions “Audit Manual”. If your Jurisdictional Audit Manual explains how to handle these situations, you are a fortunate individual. If not, you have to make some judgment calls like these listed :

13. Estimate vs. Actual (cont)… Things to consider: Distances could be possibly close enough to use for making an adjustment Useless for IRP and IFTA Probably useless for IRP and IFTA Distances could be possibly close enough to use for making an adjustment Distances could be possibly close enough to use for making an adjustment

14. Estimate vs. Actual (cont)… If miles are close enough for making an adjustment, then a determination must be made as to what type of adjustment is within reasoning. This is usually at the discretion of supervisor or manager along with the auditor’s input. The auditor must be able to thoroughly explain to the supervising auditor exactly what they are seeing and if any mileage or fuel source documents available but not used can be referenced. If the records available can in no way be used to determine with any reasonable reliability you must be able to document to the supervisor or manager exactly what IS NOT AVAILABLE that you requested. A list of everything you requested but could not obtain will be necessary. This knowledge is necessary for the supervisor or manager to make a proper decision and will help insure that no nasty items that could have been used turn up at a hearing if one is to occur. As has been discussed earlier and is the most important thing you can do is DOCUMENT, DOCUMENT, DOCUMENT everything. What may seem insignificant to you may be very important to the supervisor or manager.

15. Estimate vs. Actual (cont)… The carrier has records that the returns/renewals are based on but the auditor has determined that they are incomplete. This is the most difficult type of situation to defend if the carrier chooses to dispute the audit results as they actually do have something to present to the hearing officer or whomever and it now becomes your job to prove to the officer that the records are incomplete. It is very important in this process to document in detail every step you took and everything you examined that made you determine that miles were missing. The more detail you have the better off you will be. Again the supervisor or manager will be making the audit call on this type of audit so as been stated over and over: DOCUMENT, DOCUMENT, DOCUMENT everything.

16. Estimate vs. Actual (cont)… The carrier was estimating miles in one or more jurisdictions on the IRP renewal when the records support actual mileage in these jurisdictions. THIS IS NOT A PROBLEM IN IFTA. This is one of the areas where IFTA and IRP vary. Depending on the situation this can be a very simple issue or an extremely complex one. If the unit operating the miles has been in the fleet prior to the audit year the miles will most always be changed to actual. Every jurisdiction currently has its own procedures on how this is handled. Again the supervisor or manager will be making the audit call on this type of audit so as been stated over and over: DOCUMENT, DOCUMENT, DOCUMENT everything

17. Estimate vs. Actual (cont)… The carrier has actual miles in the jurisdiction but does not show any activity. Again each jurisdiction has its own way of handling this situation. Again the supervisor or manager will be making the audit call on this type of audit so as been stated over and over: DOCUMENT, DOCUMENT, DOCUMENT everything.