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Heavy Vehicle Use Tax (HVUT) Exemptions and Penalties

The Heavy Vehicle User Tax or HVUT is an annual federal highway use tax paid to the IRS for heavy vehicles operating on public highways at a gross weight is equal to 55,000 pounds or more. Taxable gross weight of a vehicle is calculated by adding the following:

  • The actual unloaded weight of the vehicle, when it is fully equipped for service.
  • The actual unloaded weight of any trailers or semi trailers fully equipped for service normally used in addition to the vehicle.
  • The weight of the maximum load that can be carried on the vehicle and on any trailers or semi trailers typically used with the vehicle.

IRS Heavy Vehicle Tax Exemptions (HVUT Exemptions)

Groups Exempted from the Form HVUT are:

  • Federal Government
  • State & Local governments, including the District of Columbia.
  • The American Red Cross.
  • Non-profit volunteer fire departments, ambulance associations or rescue squads.
  • Mass transportation authorities.
  • Indian tribal governments (for vehicles used in essential tribal functions).

Vehicles Exempted from HVUT are:

  • Commercial vehicle which is traveling less than 5,000 miles annually.
  • Agriculture vehicle which is traveling less than 7,500 miles annually.
  • Vehicle which is not considered to be a highway motor vehicle? Like mobile machinery for non-transportation functions, vehicles specifically designed for off-highway use, and non-transportation trailers and semi-trailers.
  • Qualified blood collector vehicles which are used by organizations for collecting blood.

What is the Purpose of HVUT?

The heavy vehicle use tax is a significant source of transportation funding in the U.S. In 2006 alone, the Form 2290 generated more than $1.4 Billion in Federal Highway Trust Fund (HTF) revenue. The Federal HTF protects America's investment in its transportation infrastructure such as:

  • Highway improvements like land acquisition, construction and reconstruction, resurfacing costs of roadways and bridges, and etc.
  • Highway and bridge maintenance and Highway law enforcement.
  • Safety programs like driver education and training, vehicle inspection programs, enforcement of vehicle size and weight limits, and etc.
  • Administrative costs like research and engineering.

HVUT Penalties

There is a law to provide the penalty for those who fail to file the tax returns and penalties for filing the fraudulent tax returns .The interest will be charged for those who file the penalties late. If you submit the reasonable cause for not filing the tax on time penalties will not be added to their returns. If you file after the due date (including extensions), attach an explanation to the return to show reasonable cause. Penalties for Form 2290 non-compliance are costly to motor carriers. The penalty for failing to file IRS Form 2290 by August 31st is equal to 4.5 percent of total tax due, assessed on a monthly basis up to five months. Late filers not making Form 2290 payment also face an additional monthly penalty equal to 0.5 percent of total tax due. Additional interest charges of 0.54 percent per month accrue as well.

Based on these rates, Form 2290 liability that was originally $550 would climb to over $700 by the end of the five-month period of delinquency. In addition to these federal penalties, many states suspend the registrations of vehicles for which proof of Form 2290 payment has not been provided. Once all criminal investigations and prosecutions are complete, a finding of non-compliance may be made public. The procedures for dealing with a finding of non-compliance are detailed in 23 CFR 369.12-369.17. In the event that a state is found to be in non-compliance, the following procedures are followed:

  • The Division Administrator notifies the Governor via certified mail of the finding of nonconformity.
  • The state is given 30 days to request a meeting to present evidence to overturn the nonconformity finding or to identify steps taken to bring the registration program into conformity.
  • If the finding is changed to compliant, the Administrator issues a final decision and the matter is concluded.
  • A finding of nonconformity requires the authorization of the Secretary of Transportation and must be served on the Governor or his or her designee.
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