How to Get Your Trucking Authority
Are you ready to secure Trucking Authority so that you can become your own boss? If so, you've got to understand that getting trucking authority can seem intimidating. There’s so much competing information online that it’s hard to figure out what to do. Plus, there are a series of specific steps you have to take. Also, getting your own authority requires many different variables. These include attention to detail, start-up cash, and a get-it-done attitude.
Are you having difficulty determining how to start the Trucking Authority process? If so, our team is here to help. We’ve listed below many common questions about obtaining authority. You can expect the whole process to take more than two months.
What Does Securing Your Own Trucking Authority Mean?
Say that you have your own Carrier Authority. This means that the government allows you to make money hauling freight. Plus, you can do so while operating as your own trucking business. The FMCSA is the organization that grants Operating Authority. FMCSA is an abbreviation of the Federal Motor Carrier Safety Administration. Operating Authority gets issued through an MC Number. MC refers to Motor Carrier.
There are various forms of authority. It depends on the type of cargo that your team will transport. Some carriers need more than one authority that applies to different forms of cargo. Say that you're transporting loads within a given state. There are states that provide required Intrastate Authority. You've got to ensure that you're applying for authorities relevant to your company.
What Are the Benefits to Having Trucking Authority?
It’s normal to want to secure your own authority after working as an owner-operator/trucker. Securing authority is a crucial career growth opportunity. Plus, authority helps provide true independence. And that independence can lead to large bumps in pay. There’s plenty of work and responsibilities involved in this process. But having authority means that you can hire any driver that you’d like. Then, you can start having many different drivers work for you. Keep in mind you’ll get tasked with locating and negotiating loads. That’s why our organization can provide you with a load board to find freight. It is low-cost and contains many potential loads to select.
How Do I Start the Trucking Authority Process?
Listed below are a series of actions you can take to get your own Trucking Authority. Please contact our experts if you have any questions about these key actions.
Determine the Type of Authority That You Need
The form of authority the government grants depends on the type of cargo that gets carried. If you transport many types of cargo, you’ll need to secure different authorities that apply. You can learn more about types of authority on the FMCSA website. There are states that require Intrastate Authority. This form of authority applies to moving goods within the certain states. Make sure that you only apply for authorities that affect your company.
Choose the Name of Your Business
File your business with your specific state. This takes place through every state’s Secretary of State. (But browse your state government’s website to make sure.) There are states that will need you to file the business under a DBA/assumed name. DBA refers to doing business as.
Determine a Business Structure
It’s best to speak with an accountant about how to organize a business. You want to do so in a manner that positions you for financial success. Try researching the following five factors.
1. LLCs: Limited Liability Companies.
2. S Corporations.
3. C Corporations.
4. Sole Proprietorships.
5. Partnerships. Assessing each of these factors will help you make an informed business decision.
Secure an EIN
What is an EIN? It stands for Employer Identification Number. You will need one for tax purposes that will accept your business.
You will need to get pre-approved for cargo insurance and primary liability. Never skip taking care of this key action. Why? Because insurance will protect you if an accident takes place. Trucking businesses cannot operate without insurance.
Secure an MC Number
You can check out the FMCSA official website to learn how to get an MC Number.
Know Where Freight Comes From
You’ve got to know where your company’s freight comes from. Why? So that you will have something to move at all times and can make consistent revenue. If you don't have customers waiting, try to become familiar with load boards. Also, try to build relationships with brokers that can help you out in the future. Check out our organization’s Load Board to learn more.
Have More Than Sixty Days of Extra Cash
Consider setting the money aside to cover your operating costs, such as repairs and fuel. Owner-operators understand that it can sometimes take 45 days for an invoice to get paid. So, when building up your business, stay prepared by having plenty of operating cash.
The Steps for Securing Trucking Authority
Once you’ve taken care of the Trucking Authority actions above, it’s time to do the steps listed below. Keep in mind that fees will vary depending on the state that you live in. You can access any state’s DOT/motor carrier website to learn more.
Trucking Authority Step 1: Apply for Authority
First, you’ll want to fill out the OP-1 or OP-1(P) form. Next, you’ll have to fill out the BOC-3 form and pay for the application fee. You will need the following truck information. 1. The VIN. 2. The year. 3. The weight of the truck. 4. License plate information. You’ll also need to submit incorporation details and your tax ID number.
The next part of Step 1 involves completing a Safety Certification Application. You will then need to complete an MCS-150. (MCS-150 refers to a Motor Carrier Identification Report.) Doing so will position you to receive a USDOT Number. That number is crucial for moving freight in vehicles for interstate commerce.
There is a standard ten-business day waiting period that takes place. This happens after the application gets posted through the Federal Registrar. Any person can protest your authority during this process. You will then need to submit proof of insurance and provide a BOC-3 form. The BOC-3 allows an agent/business to receive and forward legal documents. The FMCSA gets tasked with reviewing your authority. You will receive an official FMCSA letter when approval takes place. Then, you can continue the following Trucking Authority steps.
Trucking Authority Step 2: Get a UCR Permit
Trucking Authority Step 3: Pay the HVUT
HVUT refers to the Heavy Vehicle Use Tax. This is an annual tax that applies to all heavy vehicles that move across public highways. Begin this process by accessing Form 2290. Then, you should download an OOIDA worksheet. You have to complete the worksheet before you can agree to an IRP.
Trucking Authority Step 4: Complete IRP Registration
IRP refers to the International Registration Plan. This is an agreement that applies to all 48 continental states. IRP provides payment for licensing fees. The terms of payment depend on the operating distance across all jurisdictions. In other words, you need licensing to take part in interstate transportation. Go to the IRP website for more information about completing the process. You have to hold an IRP account before you're able to create an IFTA account. Visit How to Prepare for a Compliance DOT Audit.
Trucking Authority Step 5: Create an IFTA Account
IFTA serves as an agreement between continental states about fuel tax collection policies. (IFTA refers to the International Fuel Tax Agreement.) IFTA regulations will allow you to travel between jurisdictions. This ensures that every state keeps a share of revenue. The revenue supports transportation and road needs.
An IFTA license enables business owners to submit a required fuel tax return. This takes place every quarter. Each tax return applies to the base jurisdiction. When learning about IFTA, focus on contacting your base jurisdiction. Why? So that you can create your account without any delays.
Sometimes businesses will need to secure extra permits. New Mexico, Kentucky, and New York request weight distance permits before operations begin. Oregon asks for both a permit and a bond. Are you moving military, international, intermodal, or government loads? If so, you’ll need the SCAC: Standard Carrier Alpha Code.
Trucking Authority Step 6: Take Part in a Drug & Alcohol Testing Program
The DOT and FMCSA require motor carriers to submit negative drug tests. This takes place before drivers can get hired or operators can drive on their own. You can learn more about drug and alcohol testing policies on the FMCSA website. Supervisors of commercial drivers must finish 2 hours of controlled substance training. Each company has to select a DER. (DER refers to a Designated Employee Representative.) A DER’s authorized to fire employees who fail drug and alcohol tests. Check out DOT Authority Package.
Enroll in the New Entrant Safety Assurance Program
Have you completed all six of the above Trucking Authority steps? If so, the government will enroll you in the New Entrant Safety Assurance Program. The program will audit your company for compliance with all federal regulations. This takes place within the first eighteen months of doing business. To ensure compliance, begin maintaining good records right away. Also, make sure that you maintain the following seven factors. 1. Employee records and driver qualification files. 2. Driver logs. 3. Safety records. 4. HOS: Hours of Service records. 5. Accident reporting. 6. Maintenance records. 7. Drug and Alcohol Testing Program reports and records.
Get Your Trucking Authority One Step at a Time
Sure, there are many steps when it comes to securing Trucking Authority. But do not let yourself get stressed out. Instead, concentrate on taking everything one step at a time. Drivers and truckers become owner-operators every day. If they can do it, so can you. And remember- our organization is here to help you at any time. Call, email, or message our team to find out more about securing Operating Authority. We look forward to helping you get Trucking Authority. Visit FMCSA Registration.