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T Chek discounts for 2010

jjoerger

jjoerger

Veteran Expediter
Owner/Operator
US Army
I just got done running all our numbers for 2010. We received almost $2000 in discounts buying fuel at T/A's with our T Chek card last year.
Next year we are going to leave it on our card and spend it on Christmas. Kind of like a Christmas club account.
 
TeamCaffee

TeamCaffee

Administrator
Staff member
Owner/Operator
I added up the savings from TA from last year and had to laugh as my total was $1999.20.
 
LDB

LDB

Veteran Expediter
Retired Expediter
Are you in an IFTA truck and if so along with those discounts did you buy fuel based on net after fuel taxes and if so did you calculate how much more that saved you? (This addressing "you" as in everyone who uses T/A savings not anyone specific)
 
jjoerger

jjoerger

Veteran Expediter
Owner/Operator
US Army
Our fuel taxes on our settlements were $610 for the year. So we came out about $1400 ahead.
 
TeamCaffee

TeamCaffee

Administrator
Staff member
Owner/Operator
Ours were 225.89 for the year to date so I think we did OK as well as you guys.
 
LDB

LDB

Veteran Expediter
Retired Expediter
I don't remember without going back and refiguring again other than the quarter where my fuel tax was $4.69 and think for the year around $90 but I was pretty strict with planning and plotting to shortchange the fuel tax man whenever possible.
 
jjoerger

jjoerger

Veteran Expediter
Owner/Operator
US Army
Wow, you two did great.
We bought a lot of our fuel in Georgia, South Carolina, Virginia, Missouri and Indiana. And ran most of our miles elsewhere.
 
LDB

LDB

Veteran Expediter
Retired Expediter
Indiana is usually one of the worst places to buy when IFTA is figured in. It looks great at the pump but bottom line not so good.
 
B

BigRed32771

Expert Expediter
Ok, maybe I don't understand the way IFTA works the way I thought it did. Tell me where I've gotten it wrong.

Tax is collected whenever you buy fuel, based on the rates applicable in the state/location where you buy it. In effect, that amount is credited to your account (whether in actuality or merely the way it works out). Each state charges you for the amount of fuel they calculate you burned in their state based on mileage and an imputed burn rate. If you pay more tax in a state than that state charges you for the mileage you ran there, the difference between what you paid and what you actually owed is returned to your account as a credit. If the tax for your mileage in a given state exceeds the amount you've paid into that state by buying fuel there, you owe the difference and it is deducted from your IFTA account. If at the end of the period there is a surplus in your account it is returned to you, and if there is a deficit you are charged for it on a settlement to cover the difference.

As I see it, it all comes out in the wash: you owe what you owe based on where you run and where you buy fuel either covers it directly or it doesn't in which case you make up the difference.

What am I missing? I hear a lot of people going on about IFTA as somehow it affects their income and I don't get it.
 
LDB

LDB

Veteran Expediter
Retired Expediter
If affects your income in that they are reaching into your pocket for your wallet if your IFTA balance doesn't cover the amount of tax due. For some that run team and buy a lot in IN. and KY. where price is low and cost is high that can be several hundred dollars per quarter. It's all about the cost, not the price.
 
B

BigRed32771

Expert Expediter
LDB said:
If affects your income in that they are reaching into your pocket for your wallet if your IFTA balance doesn't cover the amount of tax due. For some that run team and buy a lot in IN. and KY. where price is low and cost is high that can be several hundred dollars per quarter. It's all about the cost, not the price.
Click to expand...

Sorry, still not getting it.

The tax is what the tax is, based on the number of miles you run in each state. If you avoid working or running in states with high fuel tax rates you can lower your cost, but it has nothing to do with your IFTA balance plus or minus. They either reach into your wallet when you pay for the fuel in the first place, or if they didn't get enough from you at that point they reach in later and hit you for the deficit. On the other hand, if they collected too much from you at the point of sale you get a refund (which properly should be reported as income since you surely took the deduction for what you paid at the pump originally, right?)

Are you saying that some states have a high tax rate but that they don't collect it all at the pump and hit you for it later? Even so, you still owe the tax based on the number of miles you ran in each state and the ultimate tax rate charged by that particular state.

No matter how I look at it, IFTA has nothing to do with business costs. It is merely a way of distributing what we pay in at the various pumps we use to the various states we work in based on a reasonable formula.

So what am I missing, or where do I get it wrong?

I know, don't call you Shirley.
 
aileron

aileron

Expert Expediter
Red,

You are absolutely right. In the price of a gallon at the pump they include tax, which is different from state to state. So, in the case with Indiana, they don't collect a lot of tax at the pump, which you have to pay later. So, you are happy that you bought cheap (yeah right) fuel, but you have to pay extra later. So, if you deduct the state tax from the pump price, you get what the actual cost of fuel is. The lower the better.

When I was in a tractor, I had to pay out of pocket very little, not as little as leo, but close. Then I understood really the concept of price vs. cost. Thanks to leo for the post a few years back on here that opened up my eyes.
 
TeamCaffee

TeamCaffee

Administrator
Staff member
Owner/Operator
You are right we have to pay tax for every mile we run in a state. Buy the fuel is where it is cheapest after taxes.

I ran some fuel prices and how they would affect us:

Oregon does not collect a fuel tax and their price of fuel always looks awesome at the pump not so awesome to IFTA

Oregon - 0 fuel tax
Jubitz - Diesel 3.229 Cash

Washington -
Tumwater - Pilot
Diesel - pump Cash 3.539
Tax .375
Price of fuel only 3.204

Take the tax out that we have to pay and then comparing apples to apples with Oregon the pump price is 3.204 cheaper then the Jubitz.



Another example:
Pilot Travel Center in East Saint Louis, IL
Cash price at pump 3.539
Tax .35
Actual price of fuel 3.219

Flying J Pontoon Beach MO
Cash price at pump 3.539
Tax .17
Actual price of fuel 3.369

Even though the price of fuel at the pump is the same after taking taxes out they are vastly different.
 
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