Interstate Authority Packages

If you are opening a trucking business, you must fill out plenty of paperwork and pay fees before beginning operations. If you intend to take cargo across state lines, you will need to obtain a letter of authority. The letter is issued by the Federal Motor Carriers Safety Administration. The FMCSA is the office inside the Department of Transportation that regulates the trucking industry.

There are a few steps you must take to attain authority. Simplex Group can help you every step of the way. We have over 20 years of experience in the trucking industry. We are committed to the success of the new trucking companies with whom we work. Our packages can save you money on upfront operating authority costs, but most importantly, they will save you time.

When you obtain a Simplex Group package, we will guide you through every step you need to get your authorization letter. There are six basic steps.

Incorporation Services 

When a person in the U.S. starts in business, they must decide what kind of business entity they will use. Very small businesses use either sole proprietorships or partnerships. When a person starts a proprietorship, they take full financial responsibility for their business. They are liable for any debts that their business incurs. A partnership is the same thing, except it involves multiple people.

If you are starting an interstate trucking company, you will not be able to operate it as a sole proprietorship or a partnership. Trucking companies are responsible for thousands of dollars worth of cargo every trip they take. It is not feasible for a person to assume that kind of responsibility. You will have to operate your business as a Limited Liability Company or a corporation.

Limited Liability Corporation

A Limited Liability company protects you from personal responsibility for corporate debts. If your company owes a bill, your creditors will not be able to go after your money. An LLC combines elements of a sole proprietorship and a corporation. Like sole proprietorships, a person who owns an LLC can pay the taxes directly through the LLC or pay them on their personal income tax return. State governments regulate LLCs instead of the federal government,

A corporation protects your personal assets as well. A corporation has a formal structure. Corporations can make an initial public offering that will allow them to sell shares to the general public and enjoy tax breaks.

We can help you decide which kind of business entity is right for you. We will also help fill out the appropriate paperwork with the state and everything that comes after that.

Federal Tax Application 

Every business needs a tax number. Your employer identification number is just like a social security number for your business. The EIN will identify you to the Internal Revenue Service and let you pay taxes each year.

Agent of Process

Any LLC or corporation needs to designate an individual or a company known as an agent of process or agent for process to accept important legal paperwork for them. The agent of process must be physically located in the state in which you are headquartered. If you have multiple headquarters, you must have process agents in every state. We will make sure your process agent designation form is filled out and kept up to date.

You will have to list every processing agent you have, in every state they work on Form BOC-3 (Designation of Process Agents.)  The paperwork must include their full name, local address, and the hours that can be served at each address. It also must include their email address and telephone number. Simplex Group can find you a processing agent in every state!

If you plan to move interstate hauls (across state or national borders), you will probably need your Interstate Operating Authority. The first thing you will need to acquire if you need interstate authority is a USDOT number.

Before for-hire motor carriers can apply for your authority letter, they must have a USDOT number. This is simply an identification number that is displayed on your truck. You will need a USDOT number if your truck:

• Has a gross vehicle weight rating or gross combination weight rating, or gross vehicle weight or gross combination weight, of 10,001 pounds or more, whichever is greater.
• Transports certain types of hazardous materials that require a safety permit in intrastate commerce.

If a vehicle takes cargo or people from one state to another, it is regulated by the  DOT and must be issued a number. If your starting point and destination are in the same state, but you drive through another state to get from point A to Point B, you will have to have a DOT number. If you transport products to Mexico or Canada, you will also need a DOT number.

To operate a trucking company, you will have to register under the Unified Carrier agreement. The Unified Carrier Registration is a system used by states to collect fees imposed on commercial vehicles. When you register your company with this system, individual states will be able to see when you have driven on their roads. They will be able to see if you are paying the appropriate fees for the miles you traveled and the weight of your vehicle. This gives states an easy way of ensuring they get the money they are owed. 

The agreement was enacted by Congress, and it was designed to replace the Single State Registration System(SSRS). The UCR Act mandates individuals or companies who work in interstate travel to pay a registration fee annually based on the total number of vehicles in their fleet. The UCR fees are used to support training and other services by the Department of Transportation. 

You must register with the UCR if you are a freight forwarder, motor carrier, broker, or leasing company and you operate a commercial vehicle that weighs over 10,000 pounds. You must also register if you carry enough hazardous material to require a placard. A company operating vehicles that carry 10 or more people (including the driver) across interstate lines must also register their vehicle. Companies based in Mexico must register as well.

Some trucks must have a motor carrier number to operate legally.  An OP-1 form must be filed to get this number. You must have an MC number if you run a company that transports people across state lines for a direct or indirect fee. For-profit trucking companies that transport federally-regulated commodities for other parties must also have an MC number.

A private carrier transporting its own cargo does not need an MC number. 

A for-hire company carrying not federally regulated cargo does not need a number as long as your drivers stay within a commercial zone in an interstate area. An example of this would be if you are operating in an area that borders two or more states, such as Portland, Oregon, and Vancouver, Washington.

There are several different types of numbers issued by the FMCSA. The kind of number you get will depend on the nature of your business.

• An FF number is issued for freight forwarders.
• An MX number is assigned to carriers based in Mexico.
• MC numbers are for any other brokers or carriers such as trucking companies.

The information you will need to provide will depend on the vehicle you drive, where it goes, and what it is used for.

If a motor carrier for hire transports commodities other than household goods across state lines, they must get an MC number. You will have to file proof that you have public liability insurance that includes bodily injury and property insurance with the FMCSA to obtain this number. 

When you run a trucking company, the kind of injury insurance policy you get is a much more detailed kind of insurance than that which you would buy for a car. Trucking companies have a responsibility to the public, and they must have public liability insurance.

Simplex Group will assist you in getting the insurance you need for every truck in your fleet. We understand that this is one of your biggest expenses. We will put together a comprehensive insurance package that will ensure you are fully covered and compliant without breaking the bank.

A moving company is defined as an entity that transports household goods for money. Movers must have public liability insurance and cargo insurance to obtain an MC number. Household goods are classified as things homeowners might use in their homes, like furniture and decor. To be considered a moving company, the haul should be paid for by individuals moving from one home to another. 

Most trucking companies take a variety of hauls and have many vehicles. You will need a separate MC number for each truck in your fleet.

Simplex Group wants to keep your insurance costs and authority fees down to a minimum.

Once you have filled out all the necessary paperwork and paid all authority payments, the federal motor carriers’ safety administration will send you an authority letter. Once you get your motor carrier authority, You will be able to launch your business.

Simplex Group has trucking authority packages for both interstate and intrastate companies. We know the trucking authority processes backward and forwards. We are committed to making your company a success. We are staffed with trained professionals and will ensure you receive your operating authority as quickly and as painlessly as possible. We can also help you with federal carrier compliance registration. Give us a call today, and we will discuss the best trucking authority package for you.