Heavy Vehicle Use Tax (HVUT)

Background

The Heavy Vehicle Use Tax (HVUT) was first enacted in section 143 of the Surface Transportation Assistance Act of 1982, Public Law 97-424, and is codified as 23 U.S.C. 141. This legislation regulates State certification of enforcement of laws respecting maximum vehicle size and weight. The most recent authorization bill, Fixing America’s Surface Transportation (FAST) Act, retains the penalty for non-compliance of the annual HVUT Certification and the HVUT Review by the State at 8% of their National Highway Performance Program funds. For Colorado, this equates to about $25,280,000.00 in federal funding.

The Federal Highway Administration (FHWA) has published in the Federal Register a final rule implementing the requirement of this statue in 23 CFR Part 669 - Enforcement of Heavy Vehicle Use Tax. The requirements include the annual certification process for vehicles that involve HVUT payments and a triennial review of the process by the FHWA Division Office.

The Internal Revenue Service (IRS) established procedures for implementing the HVUT proof-of-payment regulation. The current regulations, found in 26 CFR 41.6001-2, entitled Proof-of-Payment for State Registration Purposes, identifies the circumstances under which a State must obtain proof-of-payment of the tax imposed by 26 U.S.C. 4481(a), and the method by which such proof-of-payment is received by the State as a condition of issuing a registration for that highway motor vehicle.

A State must either comply with the provisions of this section, or comply with other, alternative rules regarding the satisfaction of proof-of-payment requirements as may be prescribed by the Commissioner of the IRS to avoid a reduction of Federal-aid highway funds. When registering a heavy vehicle over 55,000 pounds’ gross weight, a proof-of-payment of the HVUT must be presented and attached to the registration form. There are two supported documents that are allowable as evidence of proper proof-of-payment. A photocopy of the Form 2290 with the Schedule 1 receipt that is filed with the IRS in the primary and preferred approach. As a secondary option, a copy of the Form 2290 can be provided with a copy of the check, back and front, used to pay the tax. Understanding the State’s collection procedures, archival systems, and staff competency are vital aspects of the FHWA’s triennial review.

Every January 1st, the State is required by law to submit a HVUT Enforcement Certification to the FHWA Division Office. The certification verifies that the State requires evidence of the proof of payment of the HVUT upon registration of an applicable vehicle. The Governor has the signatory power to either sign the certificate or the Executive Director of the Department of Revenue of the State of Colorado with the proper documentation provided to the FHWA Colorado Division.

HVUT Proof-of-Payment forms are federally required to be retained for a one-year period. This is accomplished by scanning the forms and documents into the DRIVES account when performing the transaction. Once scanned, the paper forms and documents can be properly destroyed or provided back to the vehicle owner.

Definition

HVUT is assessed by the Federal IRS on a fiscal year basis. The taxes collected are used to fund national highway construction and maintenance of public roads.

The Federal government passed a law in 1982 requiring all states to verify payment of HVUT prior to initial registration or when renewing motor vehicle registrations. Failure to require this proof of payment could result in the State of Colorado losing up to 8% of our Federal Highway Funds.

HVUT payments are transferable when a vehicle is sold. The new purchaser will need a copy of the IRS Tax form 2290 with the specific vehicle identification number listed in order to credit the payment acknowledgment to their registration record.

Qualifying Vehicles

HVUT will be required on the following vehicle types:

• All Trucks

  • • Gross weight of 55,000 pounds and over.

      • • Empty weight of vehicle, plus the weight of the maximum load customarily carried.

• All Truck/Tractors

  • • Combined gross weight of 55,000 pounds and over.

      • • Empty weight of truck/tractor, plus.

        • The empty weight of trailer, plus.

        • The weight of the maximum load customarily carried.

• Buses

  • • Most buses are exempt from HVUT

    • Gross weight of a bus is its actual unloaded weight plus 150 lbs. for each seat provided for passengers and driver.

If the gross taxable weight is from 55,000 to 75,000 pounds, the HVUT is $100, plus $22 per 1,000 pounds over 55,000 pounds. For over 75,000-pound vehicles, the maximum HVUT is $550 per year. The table below illustrates these categories.

HVUT Exempt vehicles include (but are not limited to):

• Government Vehicles (federal, city, county and state)

• American National Red Cross Vehicles

• Non-Profit volunteer fire department, ambulance association or rescue squad vehicles

• Indian Tribal Government Vehicles (only if vehicle’s use involves the exercise of an essential tribal government function)

• Mass Transportation Authority (RTD) Vehicles

• Qualified Blood Collector Vehicles

• Specially Designed Mobile Machinery (chassis specification met) – refer to IRS Form 2290 for requirements

• Commercial Vehicles traveling less than 5,000 miles annually

• Agriculture Vehicles traveling less than 7,500 miles annually

Questions concerning the eligibility of certain vehicles may be directed to the following office:

Walk in or phone: 1-844-545-5640 (to schedule appointment) (303) 446-1675 (information line)

Internal Revenue Service,

1999 Broadway,

Denver, CO 80202

For questions, forms and online access: https://www.irs.gov/forms-pubs/about-form-2290

Applicant’s Responsibilities

The applicant is responsible for filing and paying of this tax. Exemptions of a particular vehicle with a gross weight or combined gross weight of 55,000 pounds or over, this exemption must be granted by the IRS.

Applicants with vehicles that do not have a gross weight or combined gross weight of 55,000 pounds and over, must complete a DR 2749 Federal Heavy Vehicle Use Tax Proof of Payment Exemption form.

The completion of this form by the applicant will certify compliance with the Federal law and allow the renewal or initial registration of the vehicle to be completed.

Mail the Form 2290 Heavy Vehicle Use Tax to:

Internal Revenue Service

P O Box 1236

Charlotte, NC 28201-1236

County Responsibilities

Renewal Registration:

• Registration renewals do not require Secure and Verifiable Identification information. The presentation of identification is recommended, Secure and Verifiable Identification is preferred.

• Verification of the HVUT compliance MUST be completed prior to issuing a renewal/registration. Proof of compliance may be one of the following:

  • • Receipted copy of IRS Tax form 2290/schedule 1.

    • Federal Heavy Vehicle Use Tax Proof of Payment Exemption form, or the Data Mailer renewal letter.

    • Copies of the submitted IRS Tax form 2290/schedule 1 plus front and back of canceled check. This will indicate that application and payment have been submitted to the IRS but the receipted copies have not been returned to the customer.

    • When the applicant is registering 25 or more vehicles, individual vehicle identification numbers are not required to be listed on the IRS Tax form 2290/schedule 1. The following must be provided to verify HVUT compliance:

      • • Name on the IRS Tax form 2290 and the registration MUST match.

        • TOTAL number of vehicles on the IRS Tax form 2290 MUST BE 25 or more.

        • Receipted copy of the IRS Tax form 2290 OR copies of the submitted IRS Tax form 2290 plus front and back of canceled check.

        • Per Federal Regulations, IRS Form 2290 Heavy Vehicle Use Tax has a one year required retention period 

        • Proof is also acceptable through e-file copy of the IRS 2290.

New Registration: This procedure applies to any new vehicle the applicant may purchase during the tax year.

• A named owner’s Secure and Verifiable Identification information is required to be presented on all new registration transactions (see SVID section for identification requirements).

• A named owner will provide a non-secure power of attorney to their agent to include the grantor’s (named owner’s) Secure and Verifiable Identification information. The agent’s Secure and Verifiable Identification is required to be presented for all new registration transactions performed by someone other than a named owner. (See SVID section for identification requirements)

• A Letter of Authorization or a Corporate Resolution to Borrow/Grant Collateral Letter granting permission for the agent to act on behalf of the company and the agent’s Secure and Verifiable Identification information are required for any authorized agent to perform new registration transactions (see SVID section for identification requirements).

• Parent companies, with many subsidiary companies who use D.B.A. (doing business as) names, will make payment for ALL vehicles. This results in the name on the IRS Tax form 2290 and the registration being different. When the vehicle identification number on the IRS Tax form 2290 matches the one on the registration, this will provide acceptable proof of payment.

• Federal law provides for several exemptions of the HVUT. These exemptions are applied for on IRS Tax form 2290. Copies of these applications will provide proof so that vehicle registration may take place.

• Completion of the DR 2749 Federal Heavy Vehicle Use Tax Proof of Payment Exemption form.

Newly purchased vehicles will be allowed 60 days (if necessary) to submit proof of payment or complete the DR 2749 Federal Heavy Vehicle Use Tax Proof of Payment Exemption form. When the vehicle was purchased within 60 days of the date of registration, no proof of payment for Federal Heavy Vehicle Use Tax is necessary.

Note: When renewing a vehicle with a July, August or September expiration which is subject to Federal Heavy Vehicle Use Tax, last year’s proof of payment is acceptable so the renewal may be completed.