Iowa DOT begins accepting IFTA and IRP payments using Dwolla
The Iowa DOT continues to find ways to make our processes simpler and easier for our customers. In January, the agency began accepting payments that allow motor carrier customers to use Dwolla when filing and paying International Fuel Tax Agreement (IFTA) returns and International Registration Plan (IRP) fees. As the only online payment option for the nearly 55,000 annual transactions, the new partnership provides the state and its taxpayers a streamlined online process, reduced turnaround time, an alternative to costly card payments and mailed checks, and a reduction in clerical errors and administrative costs.
Iowa DOT Director Paul Trombino III said, “Nearly 7,000 motor carriers in Iowa have been able to complete IFTA and IRP paperwork online for several years, but they have not been able to complete the payment portion of the transaction online until now. That was causing many of them to continue to file paper returns, which have a greater opportunity for errors. We think using Dwolla will reduce the number of errors and streamline the filing process for these transactions.”
The ability to complete the entire transaction online has many benefits to both Iowa’s motor carrier customers and the Iowa DOT. Mark Lowe, director of the Iowa DOT’s Motor Vehicle Division, said, “Because motor carriers had to print the document and send us a check anyway, many of them did not take advantage of the online system. By making it easier and more cost effective to pay fees and taxes, we are reducing the cost of the transaction, both for the customer and the state, and effectively increasing revenue collected.”
The online service completes several complicated calculations automatically, drastically reducing errors that can hold up the documents from being accepted. Receiving the documents online will help the DOT process the returns much more quickly and efficiently. Lowe added, “Dwolla brings the whole thing together by offering carriers an online payment option that is inexpensive and avoids credit card processing fees, which can be significant for large transactions. I think this is the first of many opportunities that the Iowa DOT will explore using Dwolla.”
The State of Iowa announced its first partnership with Dwolla in early 2013. It allowed retailers to pay more than $100 million in cigarette stamp taxes through the Iowa Department of Revenue. In July 2013, nearly a dozen Iowa counties began accepting the low-cost payment network for their individual vehicle registration and property taxes.
“Reducing the size and cost of government must also mean a more innovative, business- and taxpayer-friendly government,” said Governor Terry Branstad. “The State of Iowa has seen success in our partnership with Dwolla and the Department of Revenue. Expanding our partnership to the Department of Transportation will help our citizens and modernize the way government does business.”
“Dwolla’s simple payment network brings an effective, innovative means of payment for Iowa taxpayers, while providing increased government efficiency,” said Lt. Governor Kim Reynolds. “We’re excited about the state’s expanded use of Dwolla and are continuing to explore new ways to use the payment network.”
What is Dwolla?
It is a payment network that bypasses traditional credit and debit card networks, providing online and mobile payments. The benefits of using Dwolla include:
Cheaper than sending a check. Dwolla is only 25 cents per transaction or free for transactions of $10 or less. There are no hidden costs or licensing fees for its members or integrations.
Many uses. Individuals, businesses, and nonprofits use the online service and its mobile app every day to send money, buy goods, pay invoices, collect payments, and make donations.
Security. By eliminating the visibility and circulation of this sensitive data between the members of the network, Dwolla removes a significant source of fraud risk.
Simple. Simply sign into your existing account at checkout, enter your PIN, and initiate a payment.