With any business, you always want to succeed and make your company grow, so you can create the life you always wanted. In the motor carrier industry, there are many regulations which add layers that you must conquer to become successful.
After many years of experience, we believe that for your motor carrier business to be successful, you need to conquer the following areas:
- Find constant and increasing number of loads
- Adapt your fleet capacity to match the number of loads you find
- Stay on top of your fuel and maintenance costs
- Know the financial numbers of your business by heart & cut costs where you can
- Stay current with of all your compliance paperwork
The compliance area is always left until last and sometimes left behind. Many of you forget or disregard compliance paperwork that you need to do. The IFTA reporting for many is viewed as less important. However, if your IFTA reports are wrong or late, it can lead to financial penalties that could cripple your business.
Compliance is just as important as proactively finding loads or managing vehicle maintenance. So, let’s talk about IFTA. There are a couple of steps you must follow.
As you may know, there are two sets of data used to make sense of your fuel tax report. The distance traveled in each jurisdiction and the purchased fuel that propels the trucks. For distance, you must track the miles-per-state or kilometers-per-province that each truck travels. This is where most problems occur. For fuel, you need only track the fuel or legal diesel that makes your truck go. No reefer fuel or additives.
Step one, make sure your mileage recording processes are good – the way you record miles-per-state is accurate and true.
If drivers are using paper records like trip sheets, writing mileage down, make sure that they write down the odometer readings at the starting point of the trip, each state line crossing, and the end point of the trip for every trip.
When using an electronic system such as a GPS, a telematic system, or the GPS component of an ELD, you must be sure these systems are first calibrated and set up properly. To comply with IFTA, they have to ping every 15 minutes or less (smaller pinging intervals are even better). Make sure they work properly and will notify you if they go down. Additionally, make certain you have a way to come up with missing mileage for each trip, if needed.
When recording your miles-per-state or kilometers-per-province with an electronic system, you should make sure your electronic system is synchronized with your truck’s ECM (Engine Control Module or Engine Control Unit). This will ensure that your odometer is marking the same mileage as your electronic system, meaning there will not be a difference between odometer readings recordings and your GPS, ELD, or telematics.
So, why not have a GPS that can record miles-per-state without synchronizing to the odometer through the ECM? You can do this, however, you will run into issues figuring out which recording process is the correct one because of the discrepancies in mileages between the odometer and the GPS.
Why is this important? Because if you get audited, auditors will assess your electronic system first and if they are ruled unreliable, then they will look for your odometer readings or any paper records that you may have. If no paper records are kept, or backups of your IFTA mileages or miles-per-state, then you will be left with no records. This means you can be assessed as if you submitted no records at all, putting you in a situation where you might have to pay a lot of money in penalties.
Step two, use a tool that has been built to be IFTA compliant like eTrucks.
With eTrucks, you can easily manage your IFTA data and reporting. You can also come up with any missing miles-per-state or kilometers-per-province, if your electronic systems are down, or if your drivers did not properly record odometer readings or mileage.
All mileage reporting is based on odometer readings, but you can also enter your distances if you only have the miles per state. However, we recommend you use your odometer readings to come up with your distances for each state or province. If you are audited, you can prove that the distances are based on exact odometer readings. You will also be able to explain any gaps in the odometer readings, ensuring you pass an audit without any problems.