The International Fuel Tax Agreement (IFTA) helps save a lot of time for drivers and helps carriers or fleets remain in compliance. While almost everyone in the trucking industry has heard of IFTA, they might not fully understand how IFTA compliance can be made easier with an ELD. In this blog, we aim to highlight the benefits of integrating ELD with IFTA reporting, and how Simplex Group can simplify the process.
Overview of Electronic Logging Devices (ELD)
Electronic Logging Devices, or ELDs, are designed to replace paper log books. They digitally record the driver’s Record of Duty Status (RODS). ELDs are used to record regulated driver compliance with Hours of Service (HOS) compliance requirements. Most long-haul and regional drivers of commercial motor vehicles are mandated to use ELD to record their hours of service. The requirement to use ELD went into effect for interstate commercial drivers in December 2019.
Having an ELD enables commercial truck drivers and motor carriers to easily track HOS compliance. The ELD connects directly to the truck’s engine to record if the truck is in motion. The driver logs in and chooses their status, such as on-duty, off-duty, sleeper berth, etc. The ELD device must be provider-certified to ensure it meets the proper specifications. Also, the data should be standard format that can be used by law enforcement officers.
Understanding IFTA Reporting
IFTA is an agreement between 48 US states and the 10 Canadian provinces that simplifies reporting and payment of fuel taxes by interstate motor carriers. The carriers can use a single fuel tax license to pay taxes for fuel. IFTA has helped trucking companies manage the cost of administration, which continues to rise every year.
Along with cost benefits, IFTA also helps simplify the process for trucking companies and truck drivers. Before the IFTA came into effect, calculating and paying fuel taxes was a burden as it was a time-consuming process. Trucks had to buy a permit at the port of entry. The carriers had to keep a detailed record of the fuel purchases and odometer readings. There was also a lot of manual work involved, often leading to errors.
The process for fuel tax reporting and payment has changed significantly after the introduction of IFTA reporting, which was established in the 1980s. It allows motor carriers to file a single quarterly tax return consolidating all fuel tax payments for fleet vehicles operating in multiple jurisdictions. The IFTA report needs to have information about total miles driven in all jurisdictions and other relevant trip information.
Advantages of integrating ELD with IFTA reporting
While the benefits of IFTA have been significant, there are still some challenges, especially in the accuracy and reliability of reporting. The burden of compliance is on the truck drivers, who are often under pressure to meet tight deadlines. Fuel receipts are still needed to complete IFTA reporting requirements, while the accuracy of information is important to prevent an IFTA audit.
To help address these challenges, motor carriers can use ELD compliance for IFTA reporting. The in-built GPS capabilities of ELDs can be leveraged for automatic tracking of mileage by state or province. ELDs have real-time data transmission capabilities and can also record data for use at a later stage. The integration of ELDs can simplify the process by eliminating the need for manual record-keeping.
ELD can capture fuel purchase data electronically, including information about the amount and location of the fuel purchase. This data can be seamlessly integrated with IFTA reporting so there are no risk errors that can happen with manual data entry. Uploading fuel purchases for the entire fleet can be completed in a short time.
The ELD data can be used to prevent IFTA audits, and if an audit does happen, then the ELD data can be used as a reliable source of information about fuel taxes and purchases. Avoiding IFTA tax penalties is a major benefit for motor carriers who choose to integrate ELDs with IFTA reporting. Another added benefit of IFTA reporting with ELD solutions is that you get alerts and notifications if the ELD system detects compliance issues such as missing or erroneous data.
Other Benefits of Using ELD
Compliance with IFTA is one of many benefits of using ELD. As the ELD device syncs with the vehicle engine, you get access to a wide range of useful information. For example, you can use the data from the ELD to determine driving working hours to ensure they are not on the road longer than they should be.
You also make driver vehicle inspection reports more accurate and efficient. A commercial truck driver is required to make an inspection before they operate the vehicle and the trucking company has to keep a record of this inception. If any repairs or maintenance is needed by the vehicle, it should be completed before the truck is allowed to go back on the road.
With an ELD device on the vehicle, you can fetch the service history of the vehicle without having to go through manual log books. The daily inspection reports are automatically synced with an audit making it more reliable and accurate. Another benefit of ELD is that you can monitor fuel consumption to identify any unusual fuel use patterns that could indicate an issue with the vehicle.
How Simplex Group Simplifies Compliance
At Simplex Group, we offer comprehensive services and capabilities for ELD and IFTA reporting. We understand the strict regulatory requirements of the truck industry and have designed our solutions to make it more efficient and reliable for our customers to meet these requirements.
With over two decades of experience in the trucking industry, we have helped many trucking companies get compliant with ELD compliance requirements. We can integrate the ELD with IFTA reporting to help streamline the process. Truck drivers, fleet managers, and operators like our solutions because they make their lives easier. We are happy to provide references for our work. Contact us to learn more about ELD integration for IFTA reports for automated IFTA reporting.