Thinking about getting into the truck business? It’s never any less profitable to invest into the trucking business as they are always in business. However before you can even start, you’d be told that you’d need a Trucking authority in order to operate within this field. Trucking Authority, while it goes by a single name may actually be multiple things like getting an MC number, DOT authority, USDOT number and so on. Though most of the time it refers to the same thing.
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Operating Authority, as the name implies is the authority required by interstate commerce carriers in order to carry about freight or cargo. This authority is regulated by the Federal Motor Carrier Safety Administration (FMCSA). The FMCSA is a governmental agency that is responsible for regulating the trucking industry and issuing the Motor Carrier (MC) and USDOT numbers. These numbers serve as an identification for your operating authority and allows your trucking company to be recognized and maintained legally. The legal maintenance enables the FMCSA to conduct monitoring and inspection of your company. This also involves ensuring your compliance with the safety scores and the regulations set by the FMCSA.
In order to get the operating authority you need to go by the book and follow the procedures.
The first thing to do here is to file the paperwork for getting an authority to form your company and other business basics. You may need to acquire your EIN number and fulfill other basic requirements for business depending upon where you are from and where you intend to carry out your business.
The next thing you need to do is to apply for the authority with FMCSA by filling out the forms and paying the fee. While the process may take some time, as long as it is done properly and through a proper course of action then you won’t have much trouble with it. Make sure to verify with the intrastate authority if it’s needed.
Getting insured can be a huge hurdle for trucking companies to be considered active authority. Therefore put you time into researching this properly. Without proper insurance your authority will not be considered an active trucking authority.
After getting insured you need to register with the UCR. The Unified Carrier Registration System exists to ensure the funding of motor carrier safety laws. Following this you need to register with the International Registration Plan or the IRP and the International Fuel Tax Agreement of the IFTA. If your vehicle exceed the weight limit of 55, 000 pounds then you’re also required to Heavy Vehicle Use Tax. There may be other requirements depending upon the type and location of your cargo and other factors. But nevertheless it sounds like a lot of paperwork.
Types of Operating Authority
Whilst applying for the MC or DOT numbers you may come across different types of operating authorities at the Unified Registration System. You can choose from several types though just make sure that you choose for the right type because in case you choose the wrong one there are no refunds. However the three main authorities are:
- Motor carrier
- Freight Forwarder
You can choose the one you need though you may need multiple operation authorities depending upon your cargo and the operation that you intend to carry. The charges to file for the paperwork of getting your own authority cost around $300. This amount includes your MC and DOT number though making your authority active may actually take several more than this. Therefore you’d have to spend quite a lot before you do get your hands on the trucking authority.
Getting into the trucking business requires you to obtain a trucking authority or an operating authority. You may need to fulfill a lot of legal requirements including getting yourself an MC number or a USDOT number in order to get your company the legal recognition to operate on both interstate and intrastate levels. While the whole documentation process and the overall startup can be quite the hassle but as long as you are patient, you are really investing into a very profitable business.