Four steps, one of which almost every hand-built worksheet gets wrong. Here is a full quarter for a two-truck carrier based in Illinois, worked line by line, ending in a return that owes money on a quarter whose fuel tax nets to a credit.
Open the calculator with this quarter loaded
Two trucks, one Midwest lane, five jurisdictions. The rates below are illustrative — real ones come from the official IFTA rate table for the quarter being filed, which is why the calculator asks you for them rather than shipping a table that would be stale within weeks.
| Jurisdiction | Miles | Gallons bought | Tax rate | Surcharge |
|---|---|---|---|---|
| IL | 8,400 | 1,420.00 | $0.6270 | — |
| IN | 6,150 | 380.00 | $0.3400 | $0.6200 |
| KY | 4,820 | 910.00 | $0.2160 | $0.1020 |
| OH | 7,310 | 1,180.00 | $0.4700 | — |
| MI | 2,640 | 0.00 | $0.3130 | — |
| Total | 29,320 | 3,890.00 |
Every gallon figure on the return descends from this one number: total miles everywhere, over total gallons bought everywhere.
29,320 ÷ 3,890.00 = 7.54 MPG.
Two things about it are load-bearing. It is fleet-wide — there is no per-jurisdiction MPG, and computing one is the most common way a spreadsheet produces figures that look reasonable and reconcile to nothing. And it is carried to two decimals, because that is the figure the return itself carries; a worksheet that keeps full precision disagrees with the filed return by a few dollars per jurisdiction, which is small and is exactly the sort of unexplainable variance that lengthens an audit.
What a jurisdiction taxes is the fuel you burned inside it, which it works out from your miles and your fleet MPG. What you bought there is a separate figure entirely, and it arrives as a credit in step 3.
Michigan is the clearest case: 2,640 miles, not a drop of fuel bought. 2,640 ÷ 7.54 = 350.13 taxable gallons, every one of them owed at $0.3130 — $109.59.
Net taxable gallons are what you burned there less what you already paid tax on there. Negative means you bought more fuel in that state than you burned in it, and the state owes you.
Illinois: 1,114.06 burned − 1,420.00 bought = −305.94, at $0.6270 → a credit of $191.82. Ohio and Kentucky come back in credit too. Add the five tax lines together and the fuel tax on this quarter is a credit of $91.53.
At this point a carrier working from a spreadsheet concludes the quarter is a refund and files accordingly. It is not.
Indiana, Kentucky and Virginia collect part of their diesel tax as a surcharge on the return rather than at the pump. Two properties make it behave unlike everything above:
Indiana: 815.65 taxable gallons × $0.6200 = $505.70. Kentucky: 639.26 × $0.1020 = $65.20. Together, $570.90.
Kentucky is the instructive one. Its tax line is a credit — 270.74 gallons in hand — and it still owes the surcharge in full. Model the surcharge as one more rate to be netted against that credit and you would compute −270.74 × $0.1020, a further credit, instead of a charge.
| Jurisdiction | Taxable gal | Tax-paid gal | Net taxable | Tax | Surcharge | Row total |
|---|---|---|---|---|---|---|
| IL | 1,114.06 | 1,420.00 | −305.94 | −$191.82 | — | −$191.82 |
| IN | 815.65 | 380.00 | 435.65 | $148.12 | $505.70 | $653.82 |
| KY | 639.26 | 910.00 | −270.74 | −$58.48 | $65.20 | $6.72 |
| OH | 969.50 | 1,180.00 | −210.50 | −$98.94 | — | −$98.94 |
| MI | 350.13 | 0.00 | 350.13 | $109.59 | — | $109.59 |
| Total | −$91.53 | $570.90 | $479.37 |
The fuel tax is a credit of $91.53. The return owes $479.37. A worksheet that netted the surcharge would have reported $242.48 of surcharge instead of $570.90 — $328.42 short, in one quarter, on a return its author believed was a refund.
Interest accrues to each jurisdiction you owe, at one twelfth of the annual rate for every month or part of a month. A credit due back from another jurisdiction does not offset it. So a return that nets to a refund overall can still carry interest — on the quarter above, Indiana, Kentucky and Michigan would each accrue on their own row total, and Illinois and Ohio would accrue nothing and reduce nothing.
A qualified vehicle usually returns somewhere between 3 and 12 MPG. Outside that band, the likeliest explanation is not a remarkable fleet: it is a jurisdiction's miles or gallons left out, miles and gallons entered in the wrong columns, or litres entered as gallons. Every taxable-gallon figure descends from this number, so an error here is an error in all of them.
A purchase in a jurisdiction with no recorded miles is a standard audit query. Either the trip records are missing those miles, or the receipt belongs to a different state.
A jurisdiction with taxable miles and a rate of zero contributes nothing to the total and looks, on the page, exactly like a jurisdiction that has been dealt with.
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Other tools for the same desk: the owner-operator cost-per-mile calculator prices what a mile costs before you quote it, and the freight accessorial auditor checks whether an accessorial on an invoice was billed correctly.