IFTA Credits, Refunds, and Late Penalties

Now that the IFTA 2nd quarter deadline has passed, many of you are likely waiting for refunds or credits. If you are, you’re probably wondering when you can expect those and how that process works, but all you have to do is click the giant red refund button on the picture!

Just kidding, it’s not quite that quick, but luckily it is that easy. Stay tuned and we’ll tell you all about how the IFTA refund process works, and we’ll also go over some of the late penalties/fees for those of you that haven’t filed your returns yet.

Credit and Return Process

There are many possible outcomes after we generate your IFTA report for you, and one of the best possible is receiving either a refund or a credit. Once the system has calculated your taxes, the amount shown is either your refund/credit amount, or the amount you owe. If the amount shown is in parentheses, it signifies a negative amount, meaning you owe IFTA taxes. If the number shown is not in parentheses, then it’s your lucky day, and you’ll receive either a credit or refund for that amount!

Refunds are issued in different ways, and they will always be provided to you from your base jurisdiction. You won’t have to do anything for a refund or credit, it will be sent or applied automatically. To find out how your base jurisdiction issues refunds, we would suggest calling them, as many states have differing methods.

Late Fees/Filing Penalties

If you’re filing late, however, this all works very differently. If you have a credit in one state but owe taxes to another, the interest rate will not apply to the credited state, but will apply to states where you owe taxes. The interest rate is .4167%, and is applied beginning the date after the quarterly deadline until the total amount is paid. In addition to interest accruing on the tax amount you owe, there is also a general late penalty, which is either $50.00 or 10% of the total tax liability (whichever is greater).

Also please note, that if you live in Nevada, the penalties are much more stringent. Not only do you have to pay all of the same fees and interest as other states, but you also must pay an administrative late fee, which increases each time you file late. The administrative fees for the state of Nevada are as follows:

  • 1st Offense- $100
  • 2nd Offense- $500
  • 3rd Offense- $1,000
  • 4th Offense- $5,000
  • 5th Offense and Every Offense After- $25,000

So as you can see, if you travel through the state of Nevada, you’ll need to be extra careful and file on time; those administrative costs can add up very quickly!

If you are unsure about your base jurisdiction’s refund process, give them a call so they can explain the process for your state. If you have any other IFTA related questions, feel free to give us a call at 704.234.6005, or email us at support@expressifta.com, and our US-based support team will help you with anything else you need!

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