The International Fuel Tax Agreement (or IFTA) is an agreement between the United States and Canadian provinces intended to simplify the reporting of fuel use by motor carriers that operate in more than one jurisdiction or between jurisdictions. Alaska, Hawaii, and the Canadian Territories do not participate. A carrier registered and licensed for IFTA with its base state receives an IFTA license and two decals for each qualifying vehicle it operates. The carrier files a quarterly IFTA fuel tax report. This report is used to determine the net tax or refund due and to redistribute taxes from collecting states to states that it is due.
Fuel taxes are required for motor vehicles used, designed, or maintained for transportation of persons or property and:
- The Power Unit has two axles and a gross vehicle weight or registered gross vehicle weight 26,001 pounds or more, and/or
- The Power Unit has three or more axles regardless of weight, and/or
Is used in combination, when the weight of such combination exceeds 26,000 pounds gross vehicle or registered gross vehicle weight.