Instructions In General. The law imposes a tax each year on the use of any highway motor vehicle which falls within one of the categories shown in the tax computation schedule on the face of this form. You must file a return on Form 2290 covering all taxable vehicles in use during July of each year; and you must pay the annual tax or an installment of it no later than August 31. For vehicles put in use in any month after the month of July, a separate Form 2290 must be filed for these vehicles only, and a prorated tax paid for the number of months remaining in the taxable period. This applies even though the vehicles are replacements of vehicles upon which a tax has been paid, unless the replacement is a used vehicle on which the tax has been paid for the taxable period. The tax is incurred with the first taxable use of a vehicle in the tax period. Should the vehicle later be sold, destroyed, or otherwise disposed of, no refund or credit may be allowed for the remaining months in the taxable period. Period Covered. The taxable period begins July 1, and ends the following June 30. The return covers the taxable use of each vehicle for a period beginning with the month in which the vehicle was first used in the taxable period through June 30. Employer Identification Number.-Enter your employer identification number in the designated block on the face of this form. If you do not have such a number, you should file Form SS-4, Application for Employer Identification Number, with the Internal Revenue Service Center where you file Form 2290. Form SS-4 may be obtained from any Internal Revenue or Social Security Administration district office. Who Must File.-A return must be filed by the person in whose name any highway vehicle is, or is required to be, registered under the laws of any State of the United States, or of the District of Columbia, at the time of the first taxable use of the vehicle in the taxable period. If the person who is liable for the tax at the time the first taxable use in the taxable period occurs pays the tax, subsequent owners in the same taxable period are not liable for the tax. However, if that person does not pay the tax, anyone who later acquires the vehicle and puts it to a taxable use in the same taxable period may be required to pay the full tax. When to File.-The return is due on or before the last day of the month following the month in which the first taxable use of a vehicle occurs in the tax period. For example, the tax on vehicles in use in July must be reported on the return filed in August. If another vehicle is put into use in October, an additional return must be filed in November. Extension of Time for Filing Returns.The director of the service center may, upon proper and timely application, grant a reasonable extension of time to file a return. Application for an extension of time for filing a return must contain a full explanation of Page 2 the cause of the delay and should be addressed to the director of the service center where the return is to be filed. When to Pay.-The entire tax or first installment shown to be due on any return must be paid with the return. Make your check or money order payable to "Internal Revenue Service." If you elect to pay the tax in installments, any installment may be paid prior to the date prescribed for its payment. If an installment is not paid in full on or before the date fixed for its payment, the entire amount of the unpaid tax becomes due and shall be paid upon notice and demand from the director of the service center where the return was required to be filed. Election of Installment Privilege.-You may elect to pay the tax in up to four equal installments, depending upon when the first use of a taxable vehicle occurs in the taxable period by entering on line 5 the appropriate amount as determined in the following sentence. If the first such use was in: (1) July, August, or September, enter 1/4 of line 4; (2) October, November, or December, enter of line 4; (3) January, February, or March, enter 1/2 of line 4. The installment privilege is not available for the tax on vehicles first used in April, May, or June. Installment Payments.-The first installment must be paid when the return is required to be filed. The other installment dates are December 31, March 31, and June 30, depending upon the calendar quarter in which the liability was incurred. You should receive a notice of each installment before it becomes due. Payment should be submitted with that notice. If a notice is not received on time, send your installment payment to the same service center where you filed your return. Identify the payment the same as you identify any attachments to a return. Do not prepare a new Form 2290 simply to make an installment payment. If you elect the installment privilege and a vehicle later is sold, you are still liable for any remaining installments. Penalties and Interest.-Avoid penalties and interest by correctly filing returns and paying tax when due. The law provides penalties for failure to keep adequate records, file returns, or pay tax when due, and for late filing, and filing false or fraudulent returns. Returns Filed Late. The penalty for late filing of returns is 5 percent of the tax for each month or part of a month the tax remains unpaid, up to a maximum of 25 percent of the tax. This penalty applies unless you can show reasonable cause for the delay. If you are late filing a return, send a full explanation with the return. Taxes Not Paid When Due.-Interest: If any amount of tax is not timely paid, interest shall be paid from the last date prescribed for payment to the date actually paid as prescribed by regulations. Penalty: The penalty for failure to pay taxes when due is 1/2 of 1 percent of the unpaid amount for each month or part of a month it remains unpaid up to 25 percent of the unpaid amount. The penalty applies to any unpaid tax shown on a return. It also applies to any portion of additional tax shown on a bill if it is not paid within ten days from the date of the bill. This penalty is in addition to the interest charge on late payments. Exemptions.-The United States, a State, or any political subdivision of a State is exempt from the tax. Transit-type buses meeting certain conditions may also be exempt. For detailed information in these cases, see section 4483 of the Internal Revenue Code and the regulations thereunder. Records. If you have registered in your name any truck, truck-tractor, or bus subject to the highway use tax, you must keep records sufficient to enable the Internal Revenue to determine whether you are liable for the tax and, if so, the amount of tax due. Your records should contain copies of all returns and schedules which have been filed. You must keep these records even if a vehicle is registered in your name only a short part of the tax year. Records must be kept for at least three years after the date: (1) the tax becomes due, (2) the tax is paid, (3) an adjustment is claimed, or (4) a claim for refund is filed, whichever is later. Your records must be available at all times for inspection by the Internal Revenue Service. These records should show with respect to each vehicle: (a) A description of the vehicle (including serial number or other manufacturer's number) in sufficient detail to permit positive identification of the vehicle and of the tax category into which it falls. While not required, it may help to keep in your records a weight ticket or slip for each vehicle. (b) The date the vehicle was acquired and the name and address of the person from whom it was acquired. (c) The first month of each taxable period in which the taxable use occurred for each vehicle; and any prior month the vehicle was used in such taxable period while registered in your name with evidence to establish that such prior use was not taxable. (d) The date of sale or other transfer of the vehicle, and the name and address of the person to whom transferred. If it was otherwise disposed of, state the method of disposition. (e) If you acquire and have registered in your name during a tax year a second-hand taxable vehicle, you must get and keep evidence of whether or not there was a taxable use of this vehicle in the taxable period prior to the time it was registered in your name. The evidence may be a written statement, signed and dated by the person (or dealer) from whom the vehicle was acquired, showing whether there was a prior taxable use of the vehicle and, if so, whether the tax was paid and where it was paid. If you operate a transit system, you must keep records sufficient to show, with respect to each tax period, whether you meet the 60-percent passenger fare revenue test for the period prescribed as the test period for such tax period. Additional Information. More detailed information concerning the Federal use tax on highway motor vehicles is contained in Publication 349, which may be obtained from any Internal Revenue office. Mr. BLACKMAN. That would be true except that the National Labor Relations Board, through its rulings, are putting this into a national problem with Federal law. Mr. HUNGATE. Thank you, sir. We keep getting other flashes of light on this from different areas. This has been helpful to us. We better move along here. We have a number of witnesses. Thank you for your contribution, sir. Mr. BLACKMAN. Thank you. Mr. LYNCH. Mr. Seckington. Mr. HUNGATE. Mr. Larry Seckington for the Iowa Better Trucking Bureau in Des Moines. Please raise your right hand. Do you solemnly swear that the testimony you are about to give will be the truth, the whole truth, and nothing but the truth, so help you God? Mr. SECKINGTON. Yes. Mr. HUNGATE. Please be seated. State your name and address for the reporter and the subcommittee. TESTIMONY OF LARRY SECKINGTON, ATTORNEY, IN BEHALF OF IOWA BETTER TRUCKING BUREAU Mr. SECKINGTON. My name is Larry Seckington. I am an attorney at 7901 Douglas in Des Moines, Iowa. I am here representing the Iowa Better Trucking Bureau. Mr. HUNGATE. You have a prepared statement and without objection it will be made part of the record at this point. You're recognized for 10 minutes. You may proceed. You can read the statement or excerpts from it or comment however you please. Mr. SECKINGTON. We wish to, first of all, thank you for taking your time and energy to conduct these hearings. We believe your interest in the problem of administration of regulatory agencies shows the same concern that the independent truckers have. We know that regulation is necessary, and we know that regulation costs money. We believe that government-like business must now be concerned with the proper amount of regulation at a reasonable cost. When we see several cities in some States running into financial problems and we see many small and large businesses faced with losses and bankruptcy, we soon learn that Government can't cure all evils and that business can't support overregulation. We think the best result to come from your hearings would be a plan to fairly and economically impose only those regulations actually necessary to regulate and not bankrupt the trucker. Truckers cannot support the cost of all possible Government regulations. The various jurisdictions with which we have to deal could and in some cases do impose regulations and needs which are merely duplications of other State and/or Federal regulations. That brings up an area of great concern among many truckers as to whether or not the Federal Government should in fact get involved in regulating the independent trucker as it runs between States. For this portion I'd like to go to my prepared presentation on page 2 where we say there has been a great deal of conversation and some writings concerning the role of the Federal Government in preempting the States from the controls of the trucking industry. The Iowa Better Trucking Bureau and its clientele have what may be termed the "Missouri show us" attitude concerning Government control on the trucking industry. I might add, Mr. Hungate, that was put in there prior to the time I knew you were on this committee. Mr. HUNGATE. Thank you very much. You could have referred to us as Missouri-moo. 76-102-77- -29 Mr. SECKINGTON. We believe that effective and fair regulation is necessary. We further believe that if the Federal Government is going to become further involved in the regulations of the trucking industry, it should first of all cure some of the ills noted by the presentations on your May 19 hearings concerning the Interstate Commerce Commission and the multiplicity of forms and fees required by the various States. I have attached an exhibit, exhibit A, which shows the various filing fees, stamp fees, and renewal fees for the NARUC legislation which was hopefully prepared to present some uniform standards and fees to the various States, although it's not binding legislation as we understand it. The end result is that the Federal legislation has allowed the States to continue to control their own filing fees and forms and has merely added another layer of agency control at an increased cost with no resulting benefit. We are, therefore, reluctant to endorse greater Federal participation unless the Federal Government is willing to eliminate the disparity of filing forms and fees and to set up methods of quicker dissemination of authorities such as trip lease permits and the other commerce authorities we had to get. The prevailing attitude seems to be that interstate compacts such as the international registration plan would work well. You have also heard today about the uniform compacts which could be a basis for uniformity in the elimination of fees which we previously mentioned. We believe the Federal Government should amend its legislation to allow or require the States to prepare and implement uniform legislation concerning the interstate initial filing fee, stamp fee, and renewal fee. If you feel this is actually necessary, we would propose to implement complete uniform trip lease permits, possibly fuel permits although that is a whole different area by itself. If the States fail to create a uniform system with no duplicity of filings within a reasonable time, then we believe it is time for the Federal Government through NARUC or some similar legislation, to require by Federal law the uniformity of forms and fees. The situation wherein the Federal Government has intervened in the matter but not preempted the field is a very confusing and at times disheartening situation for independent truckers. Most of us have understood that once the Federal Government enters a field, it may and often does preempt the entire field and prevent the States from passing conflicting legislation. The present setup allows the Federal Government to enter the field and generate revenues for the States but does not require, although it suggests uniformity of fees and limitations on fees. Our plea to you on this matter is that the States be allowed to attempt to create a regulatory system which is both uniform and fair and which is not time consuming. Failing that, to ask the Federal Government to enter and preempt the field by setting up a complete uniform filing and fee system for the independent trucker. The bottom line on any proposal, of course, is dollars. And the bottom line is very important to the trucking industry. To create additional agencies without eliminating what the States are now requiring would be merely to add another layer of bureaucracy on what is already an overwhelming amount of paperwork and fees. Our position on this matter then is that we are not so concerned with the jurisdictional disputes as to whether the Federal Government should get into this area or should not. Whichever jurisdiction can accomplish what we need would be the jurisdiction we'd look to to go ahead and enter the field and take it over completely. Throughout the written presentation we have referred to several different plans which could be used for trip lease permits, for any other kind of commercial authority. You have also heard testimony on the bingo card and the stamp system which is part of the NARUČ system or the NARUC process. This system is a glaring example of the increased costs of all truckers with no resulting benefit to the States or industry. That system gives no greater or different authority to the truckers than it had before, but it does give the same authority to some time a slower pace and increased costs. Just as an example, we have attached exhibit D to our presentation which shows a bingo card with some authorities from about 21 States which cost this trucker $89.50 to merely receive these stamps and put it on his bingo card so he can travel through these States. This cost with no resulting benefit affects the bottom line. We see no reason for the added initial cost of cards and stamps. It doesn't replace anything. It gives nothing new. It's merely an additional layer of administration. The outward cost, the $89.50 from this particular exhibit is only part of the story. The industry now has to have people filing applications and purchasing stamps. The delays are not uncommon in receiving these stamps. Reorders take the same people and time. People and time affect the bottom line. We propose to eliminate the bingo card and stamps. We suggest and endorse the idea that a carrier's base State should be able to grant whatever authority is needed by that trucker for any State. Now, I am not necessarily speaking about fuel permits in this situation, just the commerce authority. One filing in the base State for the same authorities saves time and people money both for the industry and the States. Every State knows the fees and regulations of each other's State. Uniform applications submitted to a base State, an Iowa trucker, for example, applying to Iowa for authority to travel wherever he might need to go is, we think, at least a partial solution to this problem. A cab card listing by name or code number all those States where authority could be granted could be issued very quickly by the base State. This proposal is gone into in a little more detail in the trip lease portion of the written statement and could be considered only a portion of that entire program. We believe that that proposed system is fair to everyone. It would require just one filing in the base State on a standard form. It would reduce the cost by the amount of the bingo card and the stamp fees listed in exhibit A. It would eliminate serious time delays and would increase the bottom line for truckers and government. If the States cannot accomplish what seems to us to be a fairly simple and reasonable plan, then we feel that the Federal Government may well want to look into preempting this entire field. Comments earlier about the one license plate to go to Belgium, to Spain and back, we do the same thing with car licenses. My Iowa license will get me through any State in this Union. But a trucker has to have a bingo card and 23 stamps for 23 different States. We don't really see that there is that much of a complex question involved here. I refer in my testimony to the State of Iowa having a computer permit center which is a part of their international registration plan. There is no reason why with a computer center such as we have in Iowa, other States couldn't either use our computer center and set up a regional system or each State get their own computer center and process their own truckers. We think that these suggestions contained at least in the written statement are worthy to at least your consideration either as Federal legislation mandating the States do this kind of thing or the Federal Government taking a stand that if the States don't do it, we will. Thank you very much, Mr. Chairman. Mr. HUNGATE. Thank you very much. You stayed within your time. You won the door prize. Mr. Bedell? Mr. BEDELL. Thank you, Mr. Chairman. I will stay within my time. You mentioned the possibility of preemptive legislation. I think this is the first time that the legislative approach has really been seriously brought before us, I believe. I think we had a similar situation in packer bonding where the meatpackers all pretty much agreed that because of the difference in State regulations, they would like to see some Federal legislation which would be preemptive of the State legislation. If we were to take that approach and move forth with an effort to get Federal legislation, which would preempt State regulations on truckers, I would assume that we would only be able to do so on Federal highways. Would you know, Mr. Chairman? Mr. HUNGATE. I would think we can certainly do it there. I am thinking of the dump truck people who perhaps drive on the site. They are under intrastate. The burden is not on interstate commerce. If they can decide that the burden is on interstate commerce, you might go beyond the interstate. You can certainly go interstate. Mr. BEDELL. If we could only do it on Federal highways, would this in your opinion pretty well solve the problem of the multiplicity of the different State regulations or would it give greater difficulty because most truckers would indeed have to travel on State highways as well as Federal highways in order to properly perform their work? Mr. SECKINGTON. I believe if the Federal Government preempted this field, a showing will be made whether you're traveling on federally funded highways or on State and local highways that you're still involved in the process of interstate commerce and that they could in fact regulate the entire industry in that manner. Mr. BEDELL. I don't know the constitutionality of this, but if it were found that we could only do this on Federal highways, my question to you is would that pretty well solve the problem or do you think that would still leave the problem very difficult? |