IRP is an agreement among all the United States and provinces of Canada to adjust fees based on the proportion of miles you’ve traveled in each state.
IFTA is an agreement between participating states (all but Oregon) to pay taxes based on the amount of miles traveled in the state instead of where the fuel was purchased.
Apportioned plates are the type of plate you receive when you register under the IRP. They are used for trucking businesses that plan to travel in more than two jurisdictions under the IRP and exceed a certain weight limit.
Commercial plates are a type of registration for trucks staying in one state. Whether or not you need a commercial plate depends on the weight of your vehicle and what you intend to use your vehicle for.
Combination plates are for vehicles registered for both commercial and private use. They are also used when a vehicle meets a certain weight limit even if the vehicle is for personal use.
What Is IRP?
IRP is designed to help states manage their roads with the fees from registered trucking companies because trucks cause a lot of wear and tear on roads. Once you register under the IRP, your company will be provided with an apportioned license plate.
This apportioned license plate signifies that your registration fees will be calculated based on where your trucking company travels. IRP fees vary based on the fees of each jurisdiction and how much you traveled in each state or country.
When you register your business, you can expect the cost of IRP to vary each year based on what roads you plan to haul in. If you’re required to register under IRP, you may also have to follow other regulations, like purchasing the correct trucking insurance, too.
What’s the Difference Between IRP and Apportioned Registration?
IRP and apportioned registration are essentially the same. When you register under IRP, it provides apportioned plates. Apportioned means what you pay varies based on the portion of miles traveled in each state.
What Is IFTA?
IFTA stands for International Fuel Tax Agreement and it’s completely separate from IRP. While both are calculated by the number of miles traveled in each state, the organizations who take the fees are different, and the money is used in different ways.
IFTA is designed to pay for fuel taxes based on the amount of miles traveled in each state and where you purchase fuel. IFTA is used to evenly distribute the taxes gathered from each state based on where the fuel is used, not just where it is purchased. Here’s an example of how IFTA works:
If you purchase your fuel in one state, such as Wyoming, but spend more time traveling through Idaho with that fuel, you’ll pay fuel taxes for the amount of miles traveled in Idaho, not the actual amount you paid in Wyoming.
With IFTA, you can expect to submit annual or quarterly fuel tax reports to balance what taxes you’ve already paid compared to what you may owe. Depending on where you purchased fuel, you might have to pay more taxes or get a return on what you’ve already paid.
What Is IFTA?
Who Is Required To Register Under IRP and IFTA?
The requirements for IRP and IFTA are similar, so if you register for one, you most likely will need to register for the other. However, this can change depending on where your company is located and where you plan on hauling loads.
You are required to register under IRP and IFTA if you operate a qualified motor vehicle based in a participating jurisdiction and plan on operating in two or more member jurisdictions. A qualified motor vehicle according to IFTA is a vehicle that is used to transport persons or property and:
Has 2 axles and a GVW or GVWR over 26,000 lbs. or
Has 3 or more axles or
Is used in combination and exceeds 26,000 lbs.
If you have any questions about what you need to register for and if your business needs it, talk to the experts at Logistical Forwarding Solutions.