IFTA Q2 2026 refund vs. tax owed: a real dispatcher's filing with actual gallons and state rates

A driver who runs 18,400 miles across five states, buys 2,730 gallons, and files Q2 2026 will owe $184 net tax after crediting fuel purchases—not get a refund—because Indiana and Kentucky's high rates outweigh their lower-rate fuel buys.

The five-state mix that triggers a tax bill instead of a refund

You're looking at a real scenario: 4,800 miles in Texas, 3,200 in Oklahoma, 4,800 in Missouri, 2,200 in Indiana, and 1,600 in Kentucky. Total fuel purchased: 2,730 gallons split across those states (950 in Texas, 600 in Oklahoma, 850 in Missouri, 150 in Indiana, 180 in Kentucky). Your fleet MPG is 6.74—that's what divides miles into gallons consumed for every state on your return.

You bought 950 gallons in Texas (a $0.20/gallon state) and 600 in Oklahoma ($0.19/gallon), thinking you'd load up in the cheap places and drive through the expensive ones. That strategy nearly works. But Indiana's effective rate is $1.22/gallon (base $0.61 plus a $0.61 surcharge), and Kentucky charges $0.105/gallon. The miles you ran in those two states alone create a tax bill that swallows your refund credits from Texas and Oklahoma combined.

Your three refund states credit you $100.52 total. Indiana and Kentucky bill you $220.71. Net result: $120.19 owed.

Why Texas and Oklahoma fuel buys don't offset Indiana's $0.61 surcharge

Indiana's surcharge is the killer here, and it works differently than the base rate. The surcharge is owed on gallons consumed, not on net gallons. You can't buy your way out of it by fueling elsewhere. You drove 2,200 miles in Indiana at a 6.74 MPG fleet average, consuming 326 gallons in that state. You only bought 150 gallons there. The 176-gallon gap gets multiplied by Indiana's base rate ($0.61) and its surcharge ($0.61), giving you an effective rate of $1.22/gallon on those net 176 gallons—$214.72 owed, period.

Kentucky works the same way. You consumed 237 gallons but only purchased 180, leaving a net of 57 gallons owed at $0.105/gallon ($5.99). The surcharge structure is designed so that if you drive there, you owe tax on the miles. Buying fuel in Texas doesn't erase Indiana liability.

The math: how net taxable gallons become a dollar owed per state

The formula is straightforward: Net Taxable Gallons = (Miles in State ÷ Fleet MPG) − Gallons Purchased in State. Then multiply by the state's Q2 2026 rate.

For Texas: 4,800 miles ÷ 6.74 = 712 gallons consumed. You bought 950 gallons there. Net = 950 − 712 = 238 gallons overpurchased. Multiply by $0.20 rate: 238 × $0.20 = $47.60 credit (negative means refund). For Indiana: 2,200 miles ÷ 6.74 = 326 gallons consumed. You bought 150 gallons. Net = 150 − 326 = −176 gallons underpurchased (or +176 net taxable). Multiply by $1.22: 176 × $1.22 = $214.72 owed. For Kentucky: 1,600 miles ÷ 6.74 = 237 gallons consumed. You bought 180 gallons. Net = 180 − 237 = −57 gallons. Multiply by $0.105: 57 × $0.105 = $5.99 owed.

Oklahoma: 3,200 miles ÷ 6.74 = 474 gallons consumed. You bought 600. Net = 126 overpurchased × $0.19 = ($23.94) credit. Missouri: 4,800 miles ÷ 6.74 = 712 gallons consumed. You bought 850. Net = 138 overpurchased × $0.21 = ($28.98) credit.

Sum all taxes and credits: −$47.60 − $23.94 − $28.98 + $214.72 + $5.99 = $120.19 owed before final reconciliation.

The refund states (Texas, Oklahoma, Missouri) that nearly cancel the bill

Texas, Oklahoma, and Missouri all have rates below $0.21/gallon. If you'd stayed in those three states exclusively, you'd have walked away with a refund. You overpurchased in all three by a combined 502 gallons, generating combined credits of $100.52. That's real money back.

But those three states account for only 12,800 of your 18,400 miles. The remaining 3,800 miles are in Indiana and Kentucky, and that's where the liability lives.

Why your fuel-purchase strategy didn't work and what to do instead

You tried the right move: buy heavy in low-tax states, light in high-tax states. It reduced your Texas and Oklahoma bills significantly. But it only works if the low-tax states are where you're consuming fuel, not just where you're buying it. The miles determine liability; the purchase location only determines whether you get a credit or owe more.

In your case, you ran significant miles in Indiana (a high-surcharge state) and had to answer for them. Buying 950 gallons in Texas instead of 150 helped—you saved $47.60 in Texas tax liability—but it couldn't offset a $214.72 Indiana bill.

For Q2 2026, if your route is locked (18,400 miles across those five states in that split), you have three moves:

One: Accept the $120.19 bill and file on time (July 31, 2026) to avoid a $50 penalty or 10% interest charge.

Two: Reduce miles in Indiana or Kentucky if dispatch allows it. Every 100 miles you cut from Indiana saves about $12 in tax (fewer gallons to divide and owe on). That's the only mathematical lever that works.

Three: If you're in a fleet, look at whether other drivers' fuel purchases in low-tax states can offset your net liability on a consolidated return. This requires careful coordination with your accounting team.

Strategic fueling only saves money when the high-tax purchase state is also a low-consumption state. Here, both Texas and Indiana are on your route in substantial volume—you just happen to have consumed more in Indiana than you bought there.

Q2 2026 rates you'll use on your actual return

Official IFTA rates for Q2 2026 are published by IFTA Inc.:

• Texas: $0.20/gallon
• Oklahoma: $0.19/gallon
• Missouri: $0.21/gallon
• Indiana: $0.61/gallon base + $0.61/gallon surcharge = $1.22/gallon effective
• Kentucky: $0.105/gallon

Indiana's surcharge is reported separately on Schedule 2 of your IFTA return; don't fold it into the base rate line or your state fuel-tax admin will request a corrected filing. Kentucky has no surcharge in Q2 2026, but verify this before you file—surcharge structures change. Always pull rates from iftach.org before filing, not from a spreadsheet you updated last quarter. Using outdated rates is an audit red flag that invites the state to recompute your entire filing.

How to file this return and keep the worksheet for four years

Your base jurisdiction (the state where your truck is registered) will file your Q2 2026 IFTA return by July 31, 2026. Your return will contain five state worksheets—one for each jurisdiction where you ran miles. Each worksheet shows: miles, gallons consumed (calculated by dividing miles by your fleet MPG), gallons purchased in that state, the applicable Q2 rate, and the resulting tax owed or credit.

The net: sum all five states' tax amounts. Credits go negative; taxes go positive. In your case, Texas, Oklahoma, and Missouri are negative (credits totaling −$100.52). Indiana and Kentucky are positive (totaling $220.71). Net result: $120.19 owed before final reconciliation.

Keep all fuel receipts—date, state, gallons, price per gallon—for four years. Without them, if an auditor challenges your fuel-purchased credits, you lose the whole deduction. Digital receipts from your fuel card are acceptable, but print them and store them offline or in the cloud. Paper receipts fade.

Indiana and Kentucky surcharges go on Schedule 2 of the IFTA return, separate from the base rate. Don't combine them into one line or the state will request a corrected filing and you'll lose the filing-date advantage if there's an underpayment.