Trucker's Center

Taxes and Trucking

According to an ATA release, trucking supports nearly 70 percent of all freight transported annually in the U.S. There are 2.3 million class 8 trucks on the road and 11.7 million commercial trailers were registered in 2011. There are nearly 3.1 million truck drivers, among them 1 in 9 are independent operators. Total industry employment is 6.9 million, or one of every 16 people working in the United States. There are 442,338 for-hire carriers and 700,300 private carriers in the United States; 97.2 percent of them have fewer than 20 trucks and 90.5% are operating six trucks or less.

The trucking industry is absolutely crucial to the overall success of the economy. As the economy changes and improves, so does the need for trucks and truck drivers. By paying your truck dues, you provide your part to keep the economy growing.

IRS Form 2290

Truckers are familiar with the federal highway use tax for heavy motor vehicles, also known as the HUT (Highway Use Tax) or HVUT (Heavy Vehicle Use Tax). Generally this tax is reported on form 2290 for tax taxable vehicles and other trucks used since July, and its due on August 31 of each tax period.

Every motor vehicle with a taxable gross weight of 55,000 pounds or more used on a public highway by July in a tax period is liable to report the Heavy Vehicle Use Tax Form 2290 by end of August. You use the highways for less than 5,000 miles (7,500 miles for agricultural trucks) you are exempt from tax still you report Form 2290. Normally if you first use multiple vehicles in more than one month, then a separate Form 2290 must be filed for each month. You may be an individual, limited liability company (LLC), corporation, partnership, or any other type of organization (including nonprofit, charitable, educational, etc.).

IRS Watermarked Schedule 1 Proof

Truck dues are reported annually and when you report taxes, the IRS will process your return and issue you a stamped Schedule 1 copy as proof for the payment of tax liabilities. When the truck dues are reported electronically this Schedule 1 is issued with an IRS e-file watermark and date when received.

Generally, states will require verification of payment of the 2290 taxes for any taxable motor vehicle before they register the vehicle. Use this IRS watermarked (stamped) copy of Schedule 1 as proof of payment while registering vehicles with the state, renewing your insurance plates or vehicle tags.

U.S. Customs also require this proof of payment for a vehicle entering into the United States. If you do not have the stamped copy, you may use a photocopy of Schedule 1 and both sides of your canceled check as proof of payment.

Proof of Payment

No proof of payment is required for a newly purchased vehicle to register with a state you could present a copy of the bill/invoice of sale showing that the vehicle was purchased within the last 60 days. However, you must file a return and pay any tax due.

Note. When you are about to register your taxable motor vehicle with any state during the months of July, August or September, you may provide them the immediate previous years IRS stamped Schedule 1 as proof. Remember to file Truck Dues Form 2290 for the current period by the due date of the return to keep you away from the IRS audits.

A limited number of states have agreed to participate in an alternate proof of payment program with the IRS. In those states, the Department of Motor Vehicles (DMV) may forward your return to the IRS if certain requirements are met. If you provide your Form 2290 (with voucher and payment) to your DMV to be forwarded to the IRS, no further proof of payment is needed to register your vehicle. Contact your local DMV to see if your state participates in this program.

If you have submitted your truck dues Form 2290 to a local DMV to forward, your return is not considered as filed until the IRS receives it. You are responsible for any penalties or interest if the return is filed late or lost by the DMV. So keep checking for your status or choose to e-file your truck dues and pay taxes by due date.

Record Keeping

Keeping record of all your previously reported 2290 returns and schedule 1’s for a period of three years is necessary as IRS may audit it any time if required. You are liable to provide them with the details as requested and in case if you fail then you’re liable for any penalties.

Keep records of all the motor vehicle registered in your name or in your company name for only a portion of a period. If the tax is suspended on a highway motor vehicle for a period because its use on public highways during the period did not exceed 5,000 miles (7,500 miles for agricultural vehicles), the registrant must keep the records at least 3 years after the end of the period to which the suspension applies.

Records for each vehicle should show all of the following information.

  • A detailed description of the vehicle, including the VIN.
  • The weight of loads carried by the vehicle in the same form as required by any state in which the vehicle is registered or required to be registered.
  • The date you acquired the vehicle and the name and address of the person from whom you acquired it.
  • The first month of each period in which a taxable use occurred and any prior month in which the vehicle was used in the period while registered in your name, with proof that the prior use was not a taxable use.
  • The date the vehicle was sold or transferred and the name and address of the purchaser or transferee. If it was not sold, the records must show how and when you disposed of it.
  • If the tax is suspended for a vehicle, keep a record of actual highway mileage. For an agricultural vehicle, keep accurate records of the number of miles it is driven on a farm.

These are some vital information that the authorities may look for from your record book. Record keeping is very important to keep you away from any IRS audits. When you prepare and report the truck dues online with us we manage all your available documents for a period of 3 years. It would be easy for you to print it at any time when it is required.

Get prompt Tax Help

It is not that you’re not required to have complete knowledge of all the IRS compliances, but let the right person handle it efficiently. When it comes to truck taxes we can help you through but on other compliances?

The Taxpayer Advocate Service (TAS) is your voice at the IRS, an independent organization within the IRS whose employees assist taxpayers like you who are experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should. Their job is to ensure that every taxpayer is treated fairly, and that you know and understand your rights. You can offer this free help with IRS problems that you can’t resolve on your own. Check more at http://www.irs.gov/Advocate

Employer Identification Number

To report the Truck Dues online IRS requires your EIN (Employer Identification Number) or referred as Federal Tax ID number.

The EIN# is required for the IRS to protect your privacy and to know your identity. It is a combination of your EIN and your name as a unique identifier for every taxpayer. On an e-filed return, if a taxpayer's unique ID doesn't match IRS our records, e-file system rejects the return.

If you do not have an EIN, click here to apply for EIN online. You may also apply for an EIN by calling 1-800-829-4933, or you can fax or mail Form SS-4, Application for Employer Identification Number, to the IRS.

DBA (Doing Business As) Name

The phrase "doing business as" (abbreviated DBA, dba, d.b.a. or d/b/a) is to refer the trade name or a fictitious business name. It is a not a legal name registered with the authorities to conduct the business, but still it is the legal term used across United States and Canada, meaning under which the business or operation is conducted and presented.

Employer Identification Number EIN

In several U.S. states, DBAs are officially referred to using another term. For consumer protection purposes, many U.S. jurisdictions require businesses operating with fictitious names to file a DBA statement. This also reduces the possibility of two local businesses operating under the same name.

Note, though, that this is not a substitute for filing a trademark application. A DBA filing carries no legal weight in establishing trademark rights.

EIN is the corporate equivalent to a Social Security number, although it is issued to anyone, including individuals, who have to pay withholding taxes on employees. It is also issued to entities, such as states, government agencies, corporations, limited liability companies, and any other organization that must have a number for a purpose in addition to reporting withholding tax, such as for opening a bank or brokerage account.

Generally legal name is used while registering a business for EIN (Employer Identification Number) not the doing business as (DBA) name.

EFTPS

EFTPS or otherwise Electronic Federal Tax Payment Services is a voluntary system to pay the truck dues online. EFTPS is a secured platform which helps you in paying federal taxes electronically using the Internet, or by phone using the EFTPS® Voice Response System. EFTPS® is offered free by the U.S. Department of Treasury.

You must have enrolled for this payment system before you can use it. To get more information or to enroll in EFTPS, visit the EFTPS website at www.eftps.gov or call 1-800-555-4477 (24 hours a day, 7 days a week).

For EFTPS payments to be on time, you must initiate the transaction at least 1 business day before the date the payment is due. You can pay using your checking account, when you are electronically reporting your truck dues just choose EFTPS as your payment option and make the necessary payment on time. It is you, completely responsible for carrying out payments with EFTPS. When you go with the printed Form 2290 to report truck dues, do not include the payment voucher. Complete the form and print it our mail the paper Form 2290 to:

  • Department of the Treasury
  • Internal Revenue Service
  • Cincinnati, OH 45999-0031
Form 2290 Electronic Funds Withdrawal

EFW – Electronic Funds Withdrawal

The other mode of paying the tax liabilities apart from EFTPs is Electronic Funds Withdrawal or EFW or Direct Debit. With direct debit (not to be confused with direct deposit), the IRS or state tax authority automatically withdraws the full owed tax amount from your bank account.

It's a convenient method as every individual or business filers can e-file and e-pay in a single step. It's free, safe and secure. Payment information is used only for the tax payment(s) authorized. The electronic payment will be effective (i.e., settled) on the date the return or form is e-filed. After the return due date, the effective date for EFW payments is the date the return or form is successfully transmitted.

Direct-debit for partial tax payments are not available, and this payment option is on federal returns if you e-file.

What information you provide for EFW?

While choosing to pay by EFW or Direct Debit, you need to include the bank account number, account type (savings or checking), routing transaction number or routing number for the federal authorities to withdraw the tax liabilities from your bank account directly.

Routing Transit Number: The first two digits of the routing number must be 01 through 12 or 21 through 32. Do not use a deposit slip to verify the number because it may contain internal routing numbers that are not part of the actual routing number. On the sample check above, the routing number is 250250025.

Bank Account Number: The account number can be up to 17 digits. Omit hyphens, spaces, and special symbols. Enter the number from left to right and leave any unused boxes blank. On the sample check above, the account number is 20202086. Do not to include the check number.

Type of Account: The type of account can either be savings or checking. Many credit unions don't allow an electronic fund withdrawal from a savings account. Please check with your financial institution for further details.

When Trucks Stop, America Stops

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