1. Presented by IFTA Managers’ and Law Enforcement Seminar September 19, 2008 Meg Cronk – New York Ron Hester - Ontario

2. WHAT YOU’LL LEARN The Basics – core principles and benefits The Basics – core principles and benefits How IFTA Works – from A to Z How IFTA Works – from A to Z The Amendment Process – how IFTA changes The Amendment Process – how IFTA changes Compliance – jurisdiction and carrier – administrative and roadside enforcement Compliance – jurisdiction and carrier – administrative and roadside enforcement

3. IFTA 101 - Articles of Agreement 1. What does IFTA stand for? A: R110 2. What is the purpose of IFTA? A: R130

4. IFTA 101 - Articles of Agreement 3. What is the purpose of a base jurisdiction? A: R212.100-.200 4. What makes a vehicle qualify as an IFTA vehicle? A: R245

5. IFTA 101 - Articles of Agreement 5. Who is required to have an IFTA license? A: R305 6. A qualified IFTA carrier must base in the jurisdiction they are located in. A: R325 - F

6. IFTA 101 - Articles of Agreement 7. When should a base jurisdiction NOT issue an IFTA license to a carrier? A:R335 8. Under what circumstance can a base jurisdiction refuse renewal of an IFTA license? A: R345.300

7. IFTA 101 - Articles of Agreement 9. Failure to comply with all applicable provisions of the IFTA shall be grounds for suspension or revocation of a taxpayers IFTA license. A: R420.100 - T 10. The base jurisdiction is responsible for issuing one license and two decals per taxpayer vehicle. A: R620 & R625 - F

8. IFTA 101 - Articles of Agreement 11. What is the licensee required to do with the license and decals? A: R620-R625 12. What is the grace period for IFTA license renewal? A: R655.200

9. IFTA 101 - Articles of Agreement 13. A member jurisdiction may exempt from taxation any use of motor fuel within its jurisdiction. A: R830.100 - T 14. What requirements must a licensee meet to be able to file an annual return instead of filing quarterly? A: R930.200

10. IFTA 101 - Articles of Agreement 15. When is the quarterly IFTA Return due? A: R960.100 16. A licensee may claim a tax-paid credit on the IFTA Tax Return for fuel purchased at retail regardless of whether the fuel is placed into the fuel tank of qualified motor vehicles. A: R1010.100 - F

11. IFTA 101 - Articles of Agreement 17. Any credits a licensee accumulates and is not refunded will be applied to future tax reporting periods until it has been fully used or eight calendar quarters have passed from the end of the calendar quarter in which the credit accrued. A: R1120.100 - T

12. IFTA 101 - Articles of Agreement 18. A base jurisdiction has 60 days after receipt of request from a licensee to issue a refund. A: R1150 - F 19. What penalty may the base jurisdiction assess a licensee for failing to file a tax return? A: R1220.100

13. IFTA 101 - Articles of Agreement 20. The base jurisdiction must distribute a penalty received from a licensee to all travel jurisdictions. A: R1220.200 - F 21. U.S. and Canadian Jurisdictions, for itself and on behalf of the other jurisdictions, shall assess interest on all delinquent taxes due each jurisdiction at the rate of one per cent per month. A: R1230.100 &.200 - F

14. IFTA 101 - Articles of Agreement 22. The base jurisdiction shall audit its licensees on behalf of all member jurisdictions. A: R1310 - T 23. What does the Audit Manual Contain? A: R1340

15. IFTA 101 - Articles of Agreement 24. A member jurisdiction may re-audit a licensee if said member jurisdiction notifies the base jurisdiction and licensee of reasonable cause for the re-audit. A: R1360.200 - T 25. What are the 3 conditions a jurisdiction must comply with for membership in IFTA? A: R1510.100 &.200 &.300

16. IFTA 101 - Articles of Agreement 26. How many days does a member jurisdiction have to vote on the resolution of expulsion of a member jurisdiction who has failed to bring its IFTA program into compliance? A: R1555.200.020 27. Who can submit a ballot proposal? A: R1600

17. IFTA 101 - Articles of Agreement 28. What is the difference between a short track ballot and a long track ballot? A: R1625 & R1630 29. A Consensus Board Interpretation (CBI) is issued by the Board of Trustees in response to a request for clarification/interpretation of IFTA requirements stated in the article of Agreement, Procedures Manual or Audit Manual. A: R1710 – 1720 - T

18. IFTA 101 - Articles of Agreement 30. A CBI must be presented at the annual meeting and requires an affirmative vote of three fourths of the member jurisdictions for ratification and inclusion as commentary in the IFTA Governing document. A: R1720.100 - T

19. IFTA 101 - Articles of Agreement 31. A CBI that has been ratified is NOT binding on the membership. A: R1720.200 - F 32. The IFTA, Inc Clearinghouse is responsible for the maintenance and administration of only licensee demographic information. A: R2110 - F

20. IFTA 101 – Procedures Manual 1. List two requirements of information that must be included on the IFTA license application. A: P105 – 155 2. Decals must be 4” X 4” with black letters and a background color as specified for the current year. A: P320.100 - F

21. IFTA 101 – Procedures Manual 3. Jurisdictions are required to impose a decal fee to recover administration costs. to recover administration costs. A: P320.300 - F 4. Name two substitutes a taxpayer may use to secure their IFTA license in lieu of a surety secure their IFTA license in lieu of a surety bond. bond. A: P430.100.200.300.400.500

22. IFTA 101 – Procedures Manual 5. A taxpayer must make supporting tax return documents available for audit for how long? available for audit for how long? A: P510.100 6. A taxpayer’s tax paid retail purchases must be supported by a receipt or invoice, credit card receipt, supported by a receipt or invoice, credit card receipt, automated vendor generated invoice or transaction automated vendor generated invoice or transaction listing, or microfilm/microfiche of the receipt or listing, or microfilm/microfiche of the receipt or invoice. invoice. A: P560.100 - T

23. IFTA 101 – Procedures Manual 7. When may a licensee claim a tax paid credit on the IFTA tax return for bulk fuel? A: P570.400 8. On board recording devices, vehicle tracking systems or other electronic data recording systems may be used as optional use for fuel tax reporting in lieu of or in addition to hand written trip reports for tax reporting A: P610 - T

24. IFTA 101 – Procedures Manual 9. What are 3 of the 7 minimum requirements a taxpayer’s on board recording or vehicle tracking device must on board recording or vehicle tracking device must meet? meet? A: P660 10. The IFTA tax return provided by the base jurisdiction to the taxpayer must include places for the taxpayer to enter the information necessary to calculate the vehicles MPG/KPL. A: P710 - T

25. IFTA 101 – Procedures Manual 11. How long is a base jurisdiction required by IFTA to keep a taxpayer’s records? A: P920.200 12. Transmittal reports submitted by Canadian Jurisdictions can be in international customary measures and Canadian dollars. A: P1030.200 - T

26. IFTA 101 – Procedures Manual 13. What is the minimum number of transmittals a base jurisdiction must send a travel jurisdiction each year? A: P1040 14. A base jurisdiction received $300,000 of IFTA taxpayer money as a result of returns filed during the month of January. This money must be distributed to the appropriate jurisdictions by? A: P1040

27. IFTA 101 – Procedures Manual 15. To disperse taxpayer monies due to travel jurisdictions, a base jurisdiction may either allocate the actual amount received from taxpayers or assume the liabilities for the payments made to the travel jurisdictions based on what the taxpayers report on their returns. A: P1060.100.200 – T - February 28 (February 29, if leap year) 16. What is the reporting period for a base jurisdiction’s IFTA Annual Report? A: P1110.200

28. IFTA 101 – Procedures Manual 17. List 3 requirements for a base jurisdiction Annual Report. A: P1110.300 18. When must a tax rate change notification be issued by a jurisdiction so that all other jurisdictions are responsible for collecting the tax at the new rate? A: P1120.300

29. IFTA 101 – Procedures Manual 19. What is the purpose of a program compliance review? A: P1210 20. Units of measure and currency, whether U.S. or Canadian, shall be accepted in the measurement or currency authorized by the licensee’s base jurisdiction. A: P1310 - T

30. IFTA 101 – Audit Manual 1. The purpose of the audit guidelines is to establish a uniform procedure for IFTA jurisdictions to follow in establishing jurisdiction audit procedures, employing and supervising audit staff, planning and conducting audits, and reporting audit findings A: A100 - T 2. What should the pre-audit analysis of a taxpayer consist of? A: A220.100

31. IFTA 101 – Audit Manual 3. What percentage of audits is a base jurisdiction required to complete per year? A: A310 4. What percentage of the audits must be low distance accounts? A: A320

32. IFTA 101 – Audit Manual 5. Auditors must have supervisory follow-up and review of their audit procedures. A: A400.200 - T 6. All licensees are subject to audit. A: A420.100 - T

33. IFTA 101 – Audit Manual 7. What factor of the licensee’s accounting system should audit emphasis be placed on? A: A520 8. Unless a specific situation dictates, all audits will be conducted on a sampling basis. An agreement that the sampling methodology is appropriate should be signed by the licensee and the auditor. A: A530.400 - T

34. IFTA 101 – Audit Manual 9. The audit will be completed using the best information available to the base jurisdiction. The burden of proof is on the licensee. A: A540.200 - T 10 List 3 factors an auditor has the authority to use to estimate a licensee’s fuel use if adequate records are unavailable. A: A550.100.005-.025

35. IFTA 101 – Audit Manual 11. How many days prior to the audit should the licensee be contacted in writing and advised of the approximate date that an audit is to be conducted? A: A610 12. Name the identifiable phases the auditor’s study and evaluation of the licensees internal accounting control system should consist of. A: A640.100-.400

36. IFTA 101 – Audit Manual 13. Except as outlined in A650.200, a documented closing conference shall be held with the licensee outlining preliminary findings to include applicable penalty and interest, recommendations, rights of appeal and identifying the person to whom the audit report should be addressed. A: A650.100 – T 14. Make a list of 5 elements of information that must be included in the auditor’s report A: A660.100.005-.060

37. IFTA 101 – Audit Manual 15. List 3 elements of information that must be listed on the interjurisdictional report. A: A660.200.005-.040 16. What is the purpose of the audit documentation? A: A670.100-.500

38. IFTA 101 – Audit Manual 17. Within how many days of furnishing the licensee with the finalized licensee Audit Report and its customary notification of assessment and billing must the commissioner send an interjurisdictional report to all affected jurisdictions A: A690.200 18. Fuel tax adjustments resulting from audit findings will be documented and included on monthly transmittals. A: A690.400 - T

39. IFTA 101 – Audit Manual 19. If the licensee is in disagreement with the audit findings, they may request any or every jurisdiction to audit their records. A: A730 20. If a licensee makes the above described request, a jurisdiction is obligated to oblige. A: A730 - F A: A730 - F

40. Questions