Penalties for Highway tax non-compliance are costly to motor carriers. The penalty for failing to file IRS Form 2290 by August 30th is equivalent to 4.5 percent of total tax due, assessed on a monthly basis up to five months. Late filers not making a highway use tax payment also face an additional monthly penalty equal to 0.5 percent of total tax due. Additional interest charges of 0.54 percent per month accumulate as well.
Based on these rates, a Highway use tax liability that was originally $550 would climb to over $700 by the end of the five-month period of negligence. In addition to these federal penalties, many states suspend the registrations of vehicles for which proof of HVUT payment has not been provided.
HVUT evasion penalties can be even more significant, resulting in fines and imprisonment, as illustrated in the case of one owner of a small trucking company who was found guilty of HVUT evasion through the continuous re-titling of his vehicle. For his crime, the owner of the small trucking company was sentenced to serve four months in prison and an additional four months of electronically monitored home confinement. He was also ordered to pay a $2,000 fine.
Furthermore, penalties for HVUT non-compliance for states are even more costly. The Secretary of Transportation has the authority to withhold up to 25 percent of the state's Interstate Maintenance funds if it fails one of its periodic compliance reviews.