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Vehicle title transfer is the process where the title of the ownership of a vehicle is transferred from someone to another. This is typically the case when selling your vehicle to someone If you own, drive, or manage an industrial vehicle in the United States of America, then you have to pay commercial vehicle taxes. While these taxes are condemned by lots of individuals for their sheer existence, there is a good reason behind why these taxes were proposed in the first place. 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 explain about these taxes, let us see what IRS means by a “commercial vehicle.”.

According to the IRS, any vehicle that has a total weight of 55,000 lbs or more is considered a commercial vehicle, and if it travels a minimum of 5000 miles each year 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 take care of and develop highways and other roads.

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The highway use tax is checked 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 present-day 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 a total weight of over 75,000 lbs. This tax is levied as commercial vehicles are heavy and can cause major wear to public roads when traveled for the stipulated distance yearly. Not just that, these vehicles can cause more harm than other if involved in accidents with regular vehicles – both to the highway itself and other autos. These taxes are used to build 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 follows the same rules. While these commercial vehicle taxes are imposed on business and technicians that drive 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, indispensable 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 beyond 5000 miles each year do not have to pay these taxes. For you to be exempt, the driver of the vehicle must do mileage reporting and submit all forms 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 vehicles that transport mobile machinery, off road vehicles etc. You can file your IRS form 2290 either by hand 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 will need to attach them to the form.