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LESS ifta trying to understanding

I have tried to figure out how to save money on fuel taxes. If i buy my fuel based upon where it is the cheapest vs the most expensive it looks like I save money. If I buy fuel using my less ifta app it suggests fuel in the more expensive places. I cant figure out why it seems when I do the math its cheaper to pay the tax then buy that fuel. I called the company i am leased on to they have a computer program that does there taxes and claimed no one ever asked this question. Does anyone know why its better to buy fuel in the more expensive ifta states. I tried reading post about it here but when I do the math I am not getting it.

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I will try to help with any question you have, the short answer is you pay for two things at the pump, taxes and fuel. You can not change the amount of tax paid once the IFTA report is done. So take the pump price minis the state tax and buy the cheapest fuel.

Here is my first QT IFTA, this only shows the tax due to each state I ran in, no matter where I bought fuel these numbers will not change.

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Now if I take todays fuel prices from http://www.truckmiles.com/FuelPrices.asp and pretend that that was the price for the entire QT we can compare the differences.

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I am going to use IL and IN in this example for 2 reasons, 1 this is a common situation with these two states that many people choice the wrong place to fuel. 2 in my lane that I run todays IL price is the lowest without tax, and IN is the lowest at the pump.

Todays pump price in IL is $4.048 and I bought 5,419 gals in 1st QT, that comes out to $21,936.11, the tax in IL is $.411, so I paid at the pump $2,227.21 in taxes. My taxes due were $1,580.04 so I have a credit of $647.17, now I subtract that form my total spent for my new cost after IFTA of $21,288.94 true cost.

Now lets do IN, pump price of $3.913 times 5,419 gals, for $21,204.55 paid at pump. IN tax of $.16 means I paid in $867.04 but owed $1,50.04, so now I have a balance due of $713.00, now I add that to what I paid at the pump for a total after IFTA of $21,917.55 true cost.

Now we take the true cost comparison IL $21,288.94 minus IN $21,917.55 for a loss of $628.61 from buying IN fuel.

Now go back to the easy way of using the pump price minus the state tax, IL $3.636 at 5,419 gals is $19,703.48, and IN $3.741 at 5,419 gals is $20,272.48, this shows you that you spent $569.00 more in IN. The reason this does not match the number above is the added surcharge tax in IN and KY when you file IFTA.

Sorry this is so long, hope it helps.

Please ask more questions if you have them.

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IFTA is real simple. You take the pump price and minus the tax for that state and then fuel where it is the cheapest.

For example the run I am on right now. I started out in MN and went to IA to load and I final in MT. I am only a few miles from WI so I filled up there and then I topped off in SD. This is a round trip for me so I will put on 50 gallons in MT just to get me back to WI ans start all over again.

Fuel in WI is $3.933 minus .3290 in fuel tax made it $3.604

Fuel in SD is $3.949 minus .2200 in fuel tax made it $3.729

Fuel in MT is $4.089 minus .2775 in fuel tax made it $3.803

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So let me see if I've got this right. Lets use a trip from Indianapolis,IN to Beckley,WV. This is the prices for 4/5/12. Base this on 6mpg

Pump Less IFTA 200gals

Greensburg, IN 3.899 3.739 $779.80

Jeffersonville, OH 4.219 3.939 $843.80

Hurricane, WV 4.279 3.949 $855.80

If you go by the LESS ifta rate then the fuel in Indiana is the best deal but then the taxes on the back end will be higher. If you buy 200 gallons then your out of pocket will be more then $60 different while the taxes for those states will only be

Indiana 77 miles 13gals $2.08+$1.43= $3.51

Ohio 180 miles 30gals $8.40

West Virgina 120 miles 20gals $6.60

So Indiana with held $32.00 in taxes while the total taxes come to $18.51. That means that there is still a credit of $13.49 plus I saved over $60 at the pump. I see that if I buy in OH then there is a credit of $37.49 while if i buy in WV then the credit would be $47.49.

I pay on average $450 per quarter for fuel taxes. But I do realize that if you run in states where the tax rate is high then I can see that by buying it there would help you out. From what i gather is if you spread it out by buying fuel in the higher states once and a while then I can bring down what i owe at end of the quarter but still keep the up front out of pocket down also.

Next question is there a program out ther that trackes as you go?

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You are correct on IN being your cheapest, and you are correct about having to owe IFTA at the end of the Qt. But what you owe IFTA or if you have a credit does not matter in the overall picture. I am going to use your numbers for this trip only, lets only buy the 63 gals that you use and I am changing your WV tax to$6.68 and price without tax to $3.945 to be correct, so your total tax bill is $18.59 (3.51+8.40+6.68). IF you buy 63 gals without tax your prices are, IN $235.56, OH $248.16, WV $248.54, now you need to add in your tax of $18.59 to all of them to see where you will be after IFTA. Can you see why we say you can not change the tax?

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Matt I see on the 2 images that you posted earlier the total taxes due but I do not see the taxes that were paid at the pump. I just received my Q1 taxes from the company. I ran 40000 miles and bought 1744 gal in Indiana. I over bought by 1364 gals. If I would have bought those gallons in other states where the fuel is higher like OH and WV then the out of pocket would be like $272.8 more based on a $0.20 per gal cost difference. My taxes this quarter is $716 cause i ran 5100 miles in OH 2251 in WV and 1567 in NC bought no fuel in WV 250g in OH and no fuel in NC. WV cost me $134 OH $190 and NC $110. This is just part of the list but they are the big ones.

So the conclusion is In is not a good place to fuel its an odd ball state. Now that I look at it more I the less ifta. Thank you I wouldn't figure it out with out your help.

Greg

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No, you are still thinking IFTA has some thing to do with it. I only posted my tax due on my IFTA form because I don't want confuse the issue with other numbers that don't matter, what you see on my IFTA form is the tax due to each state, no mater where I buy fuel those numbers will not change. You can see that the bottom number is $1,580.04, if I had bought all my fuel in IL after IFTA I would have paid $1,580.04 in tax, if I had bought all my fuel in IN after IFTA I would have paid $1,580.04 in tax, so where you pay the tax (at the pump or in IFTA) it does not change, so you need to forget about the tax and just buy the cheapest fuel without tax. The reason I won't show my true IFTA report is because the price of fuel changes every day, so I buy some fuel in IN and some in IL, I buy in IL on Monday because that's where it was the cheapest, but on Friday I bought in IN because it was cheaper there that day.

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Lets cut to the point. to get the cheapest fuel is to find out the IFTA tax in each state you run through subtract that from the pump price or the price that you pay fore the fuel and forget that number. You cant change it, now you can look at the price of the fuel and get the cheapest fuel, the taxes that you pay at the pump ain't goining to make ya or brake ya , the price of the fuel can.

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FOR ANYONE TRYING TO FIGURE OUT IFTA, GO TO http://www.colorado.gov/cs/Satellite/Rev.... YOU WILL GET A PROGRAM CREATED BY THE STATE OF COLORADO'S DEPARTMENT OF REVENUE TO GENERATE A QUARTERLY IFTA FORM FOR THE END USER TO SEND IN TO THE STATE ALL OF THE CALCULATIONS ARE DONE. YOU JUST HAVE TO START BY ENTERING YOUR TOTAL FUEL CONSUMED (IN ALL STATES), THEN ENTER EACH STATE, THE MILES TRAVELED IN THAT STATE, AND THEN THE FUEL CONSUMED IN THAT STATE. ON PAGE 2 AT THE BOTTOM IS THE NET TO EITHER BE PAID OR REFUNDED. THE TOTAL MILES WILL BE CALCULATED AND ENTERED RIGHT ABOVE WHERE YOU ENTERED THE TOTAL FUEL CONSUMED. ANYONE CAN PLAY AROUND WITH THIS PROGRAM AND SEE HOW TO FILL OUT A QUARTERLY IFTA RETURN, AND EVEN USE IT TO DO YOUR OWN IFTA AND THEN COPY THE NUMBERS TO YOUR OWN STATE'S FORM. IN CASE YOU HAVE A PROBLEM GETTING TO THE PROGRAM WITH THIS LINK, IT'S COLORADO'S FORM DR 0122. GOOD LUCK!

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Why do people have problems with this issue

You can not change the amount of Fuel Tax you pay in each state that you drive in

Print out the State tax rate sheet available on this site, keep it in your truck

Pump price - State fuel tax rate = YOUR FUEL PRICE

Where would you buy your fuel (taking into consideration you are free to purchase fuel wherever you want)

Indiana at $3.79 or Illinois at $3.99 ?????

If you say Indiana................. FAIL

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when you buy fuel you buy 2 things FUEL, and TAXES you have to get the IFTA taxes out then buy the cheapest fuel and the IFTA tax goes in to a savings account.

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Think of it on the same lines of your income taxes. If you over pay you get a refund. So you over pay to low tax states

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Americamovesbytruck.org go to fuel price index lists avg state price less tax or findfuelstops.com use to find prices find prices for a trip

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Greg30312 will be eternally grateful.
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