Overview of Mileage Tax Bond Requirements
A number of states charge highway use taxes for motor carriers wishing to use public highways. To ensure that carriers pay those taxes and all incurred fees and penalties, many of these states require that carriers post mileage tax bonds, also known as “highway use bonds.”
Mileage tax bonds are a type of surety bond. You can have a look at our guide to learn all the basics about surety bonds. Briefly put, if a transportation company breaks the law– for example, by failing to pay taxes– the bond can be used to compensate the state, because it’s backed by а bonding company. Therefore, even if the bond principal cannot (or refuses to) pay for their claim, the claimant will still be compensated.
These bonds are currently required in Oregon, Kentucky, and Illinois. Here at Bryant Surety Bonds, we can help you get bonded regardless of your location.
The paragraphs below contain more useful information about highway use tax bonds such as cost by state, some cost saving tips, and an overview of the application process.
If you need our help, feel free to call us at (866)-450-3412. We’re looking forward to your call!
Mileage Tax Bond Cost
Each of these surety bonds has a penal sum, which puts a cap on the maximum liability of the bond principal. Each state has the authority to determine the penal sum of the bond they require. The amount is meant to provide reasonable compensation, should a motor carrier violate state laws.
However, bond principals only have to pay a fraction of that penal sum, called a premium. Premiums can be as low as 1% if you have outstanding credit, but can go higher for applicants with credit issues or a lower credit score.
Take a look at the table below to learn about state-specific costs, as well as expected premiums based on personal credit score.
|Location||Bond Type||Surety Bond Amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Kentucky||Highway Use Bond||Between $2,000 and $10,000||$100-$300||$100-$500||$150-$200 to $500-1,000||$200-$300 to $1,000-1,500|
|Illinois||Mileage Tax Bond||$1,000 to $50,000||$100-$150 to $500-$1,000||$100-$175 to $1,000-$1,500||$150-$200 to $1,500-$2,500||$150-$250 to $2,500-$7,500|
|Oregon||Highway Use Bond||$500 per one vehicle||$100||$100||$100||$100|
Factors other than your credit score can also influence your bonding costs. These include your credit report, your personal and business financial statements, and even your industry experience. To find out more and learn some tips for reducing your costs, head to our surety bond cost guide.
Getting Bonded With Bad Credit
Applicants with bad credit can still get bonded thanks to our Bad Credit Program. There is no need to look for a co-signer or post collateral. However, since applicants with a low credit score are considered high-risk, bonding companies charge higher premiums.
Premiums for those applicants normally vary between 3% and 10% of the penal sum, depending on the applicant’s unique situation. Our experts have extensive experience in the surety industry, which means we can help you get bonded at the lowest possible price by providing personalized advice. We also work with over 20 A-rated and T-listed bonding companies, which allows us to match you with the best provider for your situation.
Apply for Your Mileage Tax Bond Today!
Now that you have all the facts, you can apply for your mileage tax bond right away. Simply submit our one-page online application. We will contact you shortly with your personal quote based on the information you provided. Keep in mind that the more information your provide, the more precise your quote will be.
When one of our agents get in touch with you, they will be available to answer your questions and provide you with all the information on finishing your application.
As soon as your bond is issued, we will send you a digital copy via email. Your will receive the original copy by mail. The whole process usually takes no more than two working days.
If throughout any of the steps, you encounter questions or difficulties, we are here to help. Just call us at (866)-450-3412!