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Vehicle title transfer is the process through which the title of the ownership of a vehicle is transferred from someone to another. This is in most cases the case when selling your vehicle to someone else If you own, drive, or manage a professional vehicle in the United States of America, then you have to pay commercial vehicle taxes. While these taxes are criticized by numerous people for their sheer presence, there is a good reason behind why these taxes were originated originally. There are two basic varieties of commercial vehicle taxes – highway use tax and heavy highway use tax. These taxes will need to be filed using IRS form 2290, and thus are federal taxes. Before we go into details about these taxes, let us see what IRS means by a “commercial vehicle.”.

According to the IRS, any truck that has a total weight of 55,000 lbs or higher is considered a commercial vehicle, and if it travels a minimum of 5000 miles annually on public highways, it is mandated to pay the commercial vehicle taxes in the form of highway use tax and heavy highway use tax. The Internal Revenue Service (IRS) gathers these taxes then distributes it back between the states to preserve and develop highways and other roads.

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The highway use tax is analyzed on an annual basis by the IRS on commercial vehicles (as defined above) that travel 5000 miles or more on public highways in a year. The latest highway-use taxes are fixed at $ 100 plus an additional $ 1000 per 1000 pounds over 55,000 lbs, and at $ 550 for vehicles that have an entire weight of over 75,000 lbs. This tax is levied as commercial vehicles are heavy and can cause substantial wear to public roads when traveled for the stipulated distance annually. Not just that, these vehicles can cause more problem than other if involved in accidents with regular vehicles – both to the highway itself and other cars. These taxes are used to create new highways and roads, and maintain these and existing roadways.

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The heavy highway use tax is the same as the general highway use tax, i.e. it adopts the same rules. While these commercial vehicle taxes are levied on business and licensed contractors that run entire fleets of commercial vehicles, there are many groups that are exempt from the highway use tax and heavy highway use tax. These include state and local governments, vital services like the fire department, the police department, ambulance associations and rescue squads, the federal government and the American Red Cross. These official bodies apart, commercial vehicles that do not travel greater than 5000 miles each year do not need to pay these taxes. In order to be exempt, the operator of the vehicle must do mileage reporting and submit all charts to the IRS every year.

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Other vehicles that are exempt from the commercial vehicle taxes include agricultural vehicles that do not travel much more than 7500 miles per year, blood collector vehicles, and vehicles that are allowed to travel on public highways but are not considered commercial – like trucks that transport mobile machinery, off road vehicles etc. You can file your IRS form 2290 either personally or online. The more convenient method is to file online, and be finished with it. Ensure that you have copies of your commercial vehicle’s registration and renewal certificates, as you have to attach them to the form.