Download - 8 th Annual Managers’ and Law Enforcement Seminar IFTA Funds Netting Information.

88thth Annual Managers’ and Annual Managers’ and Law Enforcement SeminarLaw Enforcement Seminar

IFTA Funds Netting InformationIFTA Funds Netting Information


Discussion ItemsDiscussion Items Definitions Definitions Funds Netting Funds Netting Failure of Participating Members to Failure of Participating Members to Comply with Funds Netting Comply with Funds Netting Funds Netting Frequently Asked Funds Netting Frequently Asked Questions Questions (FAQ’s)(FAQ’s)


DefinitionsDefinitions ClearinghouseClearinghouse means the IFTA, Inc. Clearinghouse means the IFTA, Inc. Clearinghouse

established by R2110 of the IFTA Articles of Agreement.established by R2110 of the IFTA Articles of Agreement.

Clearinghouse Advisory CommitteeClearinghouse Advisory Committee means the means the special committee chartered and appointed by the IFTA, special committee chartered and appointed by the IFTA, Inc. Board of Trustees (“Board”) to provide technical Inc. Board of Trustees (“Board”) to provide technical guidance as well as recommendations from users guidance as well as recommendations from users regarding structure and components of the regarding structure and components of the Clearinghouse.Clearinghouse.

Funds NettingFunds Netting means the summing of each means the summing of each Participating Member’s monthly transmittal total due Participating Member’s monthly transmittal total due amount to and from every other Participating Member amount to and from every other Participating Member resulting in the net amount owed or to be received for resulting in the net amount owed or to be received for each Participating Member.each Participating Member.

88thth Annual Managers’ and Annual Managers’ and Law Enforcement Law Enforcement

SeminarSeminar Funds Netting AccountFunds Netting Account means the account means the account

established by IFTA, Inc. at a reputable financial established by IFTA, Inc. at a reputable financial institution through which the net amounts institution through which the net amounts resulting from Funds Netting are distributed.resulting from Funds Netting are distributed.

Funds Netting CalendarFunds Netting Calendar means the calendar means the calendar established by the Clearinghouse Advisory established by the Clearinghouse Advisory Committee and approved by the Board setting Committee and approved by the Board setting deadlines for each Funds Netting Cycle.deadlines for each Funds Netting Cycle.

Funds Netting CycleFunds Netting Cycle means the complete Funds means the complete Funds Netting process for one transmittal month Netting process for one transmittal month pursuant to the Funds Netting Calendar.pursuant to the Funds Netting Calendar.


Member JurisdictionMember Jurisdiction Participating MemberParticipating Member Summary Transmittal DataSummary Transmittal Data TransmittalTransmittal Transmittal DataTransmittal Data Transmittal NumberTransmittal Number means the number means the number

of the transmittal being filed for the of the transmittal being filed for the transmittal year, numbered consecutively transmittal year, numbered consecutively by the Participating Member.by the Participating Member.


Funds NettingFunds Netting Funds Netting CalendarFunds Netting Calendar The Clearinghouse Advisory The Clearinghouse Advisory

Committee (CAC) will develop a Funds Committee (CAC) will develop a Funds Netting Calendar, subject to the Netting Calendar, subject to the approval of the Board. The Funds approval of the Board. The Funds Netting Calendar will be Netting Calendar will be prepared at prepared at least one (1) year in advanceleast one (1) year in advance and will and will be posted on the Clearinghouse for be posted on the Clearinghouse for Participating Members. Participating Members.


Funds NettingFunds Netting Funds Netting CalendarFunds Netting Calendar The Funds Netting Calendar and supporting The Funds Netting Calendar and supporting

information will provide the following for information will provide the following for Participating Members:Participating Members:

• Deadlines for transmittal data to be uploaded/reviewed.• Funds Netting Totals Issued• Deadline for paper transmittal preparation for jurisdictions

not in CH• Date Funds Due to IFTA, Inc.• Date Funds Transferred by IFTA, Inc.• Deadline to send checks: Jurisdictions not in CH to all

jurisdictions and CH jurisdictions to non-participating jurisdictions.

• Date Late Funds Due to IFTA, Inc.• Late Funds Transferred by IFTA, Inc.

The Funds Netting Calendar for 2010, Attachment 1, The Funds Netting Calendar for 2010, Attachment 1, is included as an example.is included as an example.


Clearinghouse Transmittal Period Number: This is This is the number assigned by the IFTA, Inc. Clearinghouse to the number assigned by the IFTA, Inc. Clearinghouse to transmittals uploaded by Participating Members for a transmittals uploaded by Participating Members for a Funds Netting CycleFunds Netting Cycle. This number does NOT replace . This number does NOT replace any other required number. However, it may be used to any other required number. However, it may be used to find all detail information from transmittals received in find all detail information from transmittals received in the Upload Transmittal Month.the Upload Transmittal Month.

Jurisdiction Upload/Review Deadline: The date by The date by which each Participating Member must have uploaded which each Participating Member must have uploaded and reviewed its Transmittal Data for the Funds Netting and reviewed its Transmittal Data for the Funds Netting CycleCycle. The data which must be uploaded is the data . The data which must be uploaded is the data required by Section P1040 of the IFTA Procedures required by Section P1040 of the IFTA Procedures Manual and A690 of the IFTA Audit Manual. The Manual and A690 of the IFTA Audit Manual. The Transmittal Data that must be included for timely Transmittal Data that must be included for timely transmittal will be identified by the CAC and approved transmittal will be identified by the CAC and approved by the Board as part of the Funds Netting Calendar.by the Board as part of the Funds Netting Calendar.


Funds Netting Totals Issued: The date on which The date on which IFTA, Inc. will issue the Funds Netting Totals to the IFTA, Inc. will issue the Funds Netting Totals to the Participating Members. Participating Members. These totals will indicate These totals will indicate whether a Participating Member will send money to or whether a Participating Member will send money to or receive money from the Funds Netting Account.receive money from the Funds Netting Account.

Funds Due to IFTA, Inc.: The date by which The date by which Participating Members required to send funds to the Participating Members required to send funds to the Funds Netting Account must have funded the account.Funds Netting Account must have funded the account.

Funds Transferred by IFTA, Inc.:Funds Transferred by IFTA, Inc.: The date that The date that IFTA, Inc. will make transfers to Participating IFTA, Inc. will make transfers to Participating Members to which funds are owed from the Funds Members to which funds are owed from the Funds Netting Account.Netting Account.

Late Funds Transferred by IFTA, Inc.:Late Funds Transferred by IFTA, Inc.: The date by The date by which IFTA, Inc. must make the second transfer of which IFTA, Inc. must make the second transfer of untimely-submitted funds.untimely-submitted funds.

88thth Annual Managers’ and Annual Managers’ and Law Enforcement SeminarLaw Enforcement Seminar Upload of DataUpload of Data

Participating Members will upload Participating Members will upload Transmittal and Transmittal and Summary Transmittal Summary Transmittal Data pursuant to the dates Data pursuant to the dates contained in contained in the Funds Netting Calendar. All time the Funds Netting Calendar. All time deadlines shown on the Funds Netting deadlines shown on the Funds Netting Calendar Calendar are are Mountain Standard Time Mountain Standard Time (MST).(MST).

Jurisdiction Review of DataJurisdiction Review of DataOn or before the date designated on the On or before the date designated on the

Funds Funds Netting Calendar (see 2.1.2), Netting Calendar (see 2.1.2), the the Participating Participating Members should review their Members should review their uploaded datauploaded data for for accuracy.accuracy.


If a Participating Member determines that the uploaded If a Participating Member determines that the uploaded data is inaccurate, the Participating Member must data is inaccurate, the Participating Member must contact IFTA, Inc. by email and request that the contact IFTA, Inc. by email and request that the uploaded file be deleted.uploaded file be deleted.

IFTA, Inc. will delete the file and inform the IFTA, Inc. will delete the file and inform the Participating Member that the action has been taken.Participating Member that the action has been taken.

The Participating Member must upload a correct file on The Participating Member must upload a correct file on or before the due date shown on the Funds Netting or before the due date shown on the Funds Netting Calendar.Calendar.

Clearinghouse Funds Netting ReportsClearinghouse Funds Netting ReportsOn the Funds Netting Totals Issued date On the Funds Netting Totals Issued date

(see 2.1.3) IFTA, (see 2.1.3) IFTA, Inc. will provide the Participating Inc. will provide the Participating Members, via the Members, via the Clearinghouse and via an Clearinghouse and via an attachment to an email, Jurisdiction attachment to an email, Jurisdiction Summary Summary Funds Netting Totals and the Final Settlement Funds Netting Totals and the Final Settlement Report.Report.


Jurisdiction Summary Funds Netting Totals Jurisdiction Summary Funds Netting Totals This This report will be available to each Participating report will be available to each Participating Member by the date required on the Funds Netting Member by the date required on the Funds Netting Calendar (see 2.1.2). The Jurisdiction Summary Calendar (see 2.1.2). The Jurisdiction Summary Funds Netting Totals report will show, for a Funds Netting Totals report will show, for a Participating Member, the Funds Netting results for Participating Member, the Funds Netting results for that Participating Member and all other that Participating Member and all other Participating Members. Participating Members.

Final Settlement Report Final Settlement Report This report will be This report will be available to all Participating Members. This report available to all Participating Members. This report will show for all Participating Members, the final will show for all Participating Members, the final result of the Funds Netting and will show either the result of the Funds Netting and will show either the amount due to or the amount due from the Funds amount due to or the amount due from the Funds Netting Account for the current Funds Netting Cycle.Netting Account for the current Funds Netting Cycle.

88thth Annual Managers’ and Annual Managers’ and Law Enforcement SeminarLaw Enforcement Seminar Transmission of Funds to Funds Netting Transmission of Funds to Funds Netting

AccountAccount

Participating Members will, when required, Participating Members will, when required, transfer the amount due from the Final Settlement transfer the amount due from the Final Settlement Report to the Funds Netting Account (see 1.4) Report to the Funds Netting Account (see 1.4) pursuant to the dates contained in the Funds pursuant to the dates contained in the Funds Netting Calendar (see 2.1.4). IFTA, Inc. will Netting Calendar (see 2.1.4). IFTA, Inc. will monitor the Funds Netting Account and will track monitor the Funds Netting Account and will track incoming funds. IFTA, Inc. will confirm receipt of incoming funds. IFTA, Inc. will confirm receipt of funds due to the person designated by the funds due to the person designated by the Participating Member. IFTA, Inc. will contact Participating Member. IFTA, Inc. will contact each Participating Member that has not each Participating Member that has not transferred funds until and including the due date.transferred funds until and including the due date.

88thth Annual Managers’ and Annual Managers’ and Law Enforcement SeminarLaw Enforcement Seminar Distribution of Funds by IFTA, Inc.Distribution of Funds by IFTA, Inc.

IFTA, Inc. will distribute funds IFTA, Inc. will distribute funds based on the based on the Final Settlement Final Settlement Report to the applicable Report to the applicable Participating Members. The funds will Participating Members. The funds will be be distributed based on the Funds distributed based on the Funds Netting Netting Calendar (see 2.1.5). Calendar (see 2.1.5). IFTA, IFTA, Inc. will confirm Inc. will confirm distribution of the distribution of the funds to the receiving funds to the receiving Participating Member.Participating Member.


Failure of Participating Members to Failure of Participating Members to Comply with Funds Netting CalendarComply with Funds Netting Calendar

Failure to Timely Upload Transmittal DataFailure to Timely Upload Transmittal Data When Participating Members fail to timely upload When Participating Members fail to timely upload

Transmittal Data pursuant to the Funds Netting Transmittal Data pursuant to the Funds Netting Calendar, the Transmittal Data for that period will Calendar, the Transmittal Data for that period will not be processed into the Clearinghousenot be processed into the Clearinghouse by IFTA, by IFTA, Inc. until the Funds Netting Cycle is completed.Inc. until the Funds Netting Cycle is completed.

For the current Funds Netting Cycle, the Funds For the current Funds Netting Cycle, the Funds Netting amount due to and from the Participating Netting amount due to and from the Participating Members Members failing to timely upload any Transmittal failing to timely upload any Transmittal Data will be considered zero.Data will be considered zero.


Failure to Timely Upload Transmittal Data Failure to Timely Upload Transmittal Data If the Participating Members that failed to timely If the Participating Members that failed to timely

upload Transmittal Data are due funds from the Funds upload Transmittal Data are due funds from the Funds Netting Account, those Participating Members will Netting Account, those Participating Members will receive those funds.receive those funds.

If the Participating Members that failed to timely If the Participating Members that failed to timely upload Transmittal Data owe funds to the Funds upload Transmittal Data owe funds to the Funds Netting Account, Netting Account, those Participating Members those Participating Members must transmit those funds even though the must transmit those funds even though the Transmittal Data was not uploadedTransmittal Data was not uploaded..

Upon completion of the Funds Netting Cycle (for Upon completion of the Funds Netting Cycle (for which the Transmittal Data should have been which the Transmittal Data should have been uploaded), Participating Members that failed to timely uploaded), Participating Members that failed to timely upload the Transmittal Data must upload the untimely upload the Transmittal Data must upload the untimely file on or before the date defined in Section 2.1.2 for file on or before the date defined in Section 2.1.2 for the next Funds Netting Cycle.the next Funds Netting Cycle.

88thth Annual Managers’ and Annual Managers’ and Law Enforcement SeminarLaw Enforcement Seminar Failure to Timely Upload Transmittal DataFailure to Timely Upload Transmittal Data

In the Funds Netting Cycle following the one in which In the Funds Netting Cycle following the one in which Transmittal Data was not loaded, the Participating Transmittal Data was not loaded, the Participating Member(s) that failed to upload data in the previous Funds Member(s) that failed to upload data in the previous Funds Netting Cycle Netting Cycle will have at least two (2) Transmittal Data will have at least two (2) Transmittal Data files and at least two (2) Summary Transmittal Data filesfiles and at least two (2) Summary Transmittal Data files (one for the current Funds Netting Cycle and one from the (one for the current Funds Netting Cycle and one from the previous Funds Netting Cycle) included in the summary previous Funds Netting Cycle) included in the summary total amounts from which the Funds Netting amounts will total amounts from which the Funds Netting amounts will be determinedbe determined

All Transmittal Data and Summary Transmittal Data files All Transmittal Data and Summary Transmittal Data files will be included in will be included in one summary total for purposes of one summary total for purposes of Funds Netting.Funds Netting.

The detail from The detail from the two (2) transmittals will be separate the two (2) transmittals will be separate and distinct, by Clearinghouse Transmittal Period and distinct, by Clearinghouse Transmittal Period NumberNumber (see 2.1.1) and by Transmittal Number (see (see 2.1.1) and by Transmittal Number (see 1.12).1.12).

88thth Annual Managers’ and Annual Managers’ and Law Enforcement SeminarLaw Enforcement Seminar Failure to Timely Fund the Funds Netting Failure to Timely Fund the Funds Netting

AccountAccount If a Participating Member fails to timely fund the Funds If a Participating Member fails to timely fund the Funds

Netting Account pursuant to the Funds Netting Calendar, Netting Account pursuant to the Funds Netting Calendar, the amounts due from the the amounts due from the Funds Netting Account will be Funds Netting Account will be prorated based on the percentage of the total fundsprorated based on the percentage of the total funds represented by that Participating Member’s missing represented by that Participating Member’s missing payment. The following example shows that only one payment. The following example shows that only one jurisdiction (EE) funded timely. The amount received was jurisdiction (EE) funded timely. The amount received was prorated among the jurisdictions due funds from the Funds prorated among the jurisdictions due funds from the Funds Netting Account. On the late funding day, only one other Netting Account. On the late funding day, only one other jurisdiction (CC) funded the account. That amount was jurisdiction (CC) funded the account. That amount was then prorated to those jurisdictions still having funds due. then prorated to those jurisdictions still having funds due. Jurisdiction DD would have to pay the amounts show to Jurisdiction DD would have to pay the amounts show to jurisdictions AA and BB outside the Funds Netting process jurisdictions AA and BB outside the Funds Netting process (see 3.2.4).(see 3.2.4).


IF T A C H F unds Netting Illustra tion P rora tion of L a te F unding

B a se Due to Due from

J ur C H Ac c t C H Ac c t R ec 'd % Distributed R ec 'd Distributed F rom T o

AA 1,462.65$ 1,218.96$ 135.44$ -$ 108.26$ B B 158.68$ 132.24$ 14.69$ -$ 11.74$ C C 150.13$ -$ 150.13$ -$ -$ -$ DD 120.00$ -$ -$ 120.00$ -$ E E 1,351.20$ 1,351.20$ -$ -$ -$ -$

Totals 1,621.33$ 1,621.33$ 1,351.20$ 83% 1,351.20$ 150.13$ 150.13$ 120.00$ 120.00$

F unds Netting R esult

L a te F unds F unds R ec e ived T imely P a ya ble O/S of C H


A Participating Member A Participating Member failing to timely fund the failing to timely fund the Funds Netting AccountFunds Netting Account must transmit the funds must transmit the funds due by the date shown on the Funds Netting due by the date shown on the Funds Netting Calendar (see 2.1.6).Calendar (see 2.1.6).

The The untimely funds will be distributeduntimely funds will be distributed to to Participating Members by IFTA, Inc. by the date Participating Members by IFTA, Inc. by the date shown on the Funds Netting Calendar (see 2.1.7).shown on the Funds Netting Calendar (see 2.1.7).

A Participating Member A Participating Member failing to transfer failing to transfer untimely funds as required by 3.2.2. must remit untimely funds as required by 3.2.2. must remit payment directly to all other member payment directly to all other member jurisdictions,jurisdictions, including Participating Members, including Participating Members, without the benefit of the Funds Netting Account.without the benefit of the Funds Netting Account.


Funds Netting Frequently Asked Funds Netting Frequently Asked QuestionsQuestions

Who should I contact if I have a Who should I contact if I have a technical issue with the IFTA, Inc. technical issue with the IFTA, Inc. Clearinghouse?Clearinghouse?

Jason DeGraf – IFTA, Inc. – Jason DeGraf – IFTA, Inc. – [email protected]@iftach.org – (480) 839-4382 – (480) 839-4382



Who should I contact if I have an issue, other than Who should I contact if I have an issue, other than a technical issue, regarding the Clearinghouse?a technical issue, regarding the Clearinghouse?

The Clearinghouse Advisory Committee. The committee can be contacted via the IFTA, Inc. website at www.iftach.org. Click on the Committees tab. On the Committees page, the Clearinghouse Advisory Committee can be found in the list of Special Committees.



What happens if our system goes down What happens if our system goes down and we can not upload our information to and we can not upload our information to the Clearinghouse?the Clearinghouse?

If you are unable to upload Transmittal Data to the Clearinghouse in a timely manner, your data cannot be included in the Funds Netting Cycle (see 3.1).

88thth Annual Managers’ and Annual Managers’ and Law Enforcement SeminarLaw Enforcement Seminar If our system goes down and we cannot If our system goes down and we cannot

upload our information to the upload our information to the Clearinghouse, can we send the Clearinghouse, can we send the Transmittal Data to IFTA, Inc. in another Transmittal Data to IFTA, Inc. in another manner?manner?

Yes.Yes. Transmittal Data can be sent to Transmittal Data can be sent to IFTA, Inc. by sending the data by IFTA, Inc. by sending the data by email or by mail. You should contact email or by mail. You should contact IFTA, Inc. as soon as you know you IFTA, Inc. as soon as you know you will be unable to upload data. will be unable to upload data.

88thth Annual Managers’ and Annual Managers’ and Law Enforcement SeminarLaw Enforcement Seminar What happens if the same Transmittal Data What happens if the same Transmittal Data

is inadvertently uploaded more than once is inadvertently uploaded more than once in a Funds Netting Cycle?in a Funds Netting Cycle?

The Transmittal Data detail (i.e. information from the licensees’ tax returns) will load to the Clearinghouse. However, the Summary Total Data from that transmittal will only load once. Therefore, the Summary Total Data from that transmittal will be included only once in the Funds Netting.