So, you’re ready to get your Motor Carrier Operating Authority (MC Number), but you’re not sure where to start. Follow this step-by-step guide to learn how to get your MC number!
Who needs an MC number? Who doesn't need an MC number?
You should be aware that not all carriers are required to have an MC number. Let’s look at some examples:
Intrastate Carriers – This is defined as carriers that only perform trade, traffic, or transportation exclusively in the business’s domicile state.
Private Carriers – This is defined as carriers that transport their own cargo.
For-hire Carriers that exclusively haul exempt commodities, which is defined as cargo that is not federally regulated.
Carriers that operate exclusively within a federally designated “commercial zone” that is exempt from interstate authority rules. A commercial zone is, for example, a geographic territory that includes multiple states bordering on a major metropolitan city.
If you plan to cross state lines, also known as interstate, and don’t fall under these other categories, you will need an MC number.
What are the steps to get your MC number?
1. Decide on your business structure:
You will need to research and decide which business structure will work best for your business. Your business structure will determine how you pay taxes, raise money, the types of paperwork you will file, and your level of personal liability. You can learn more about the different types of business structures in trucking here.
2. Form your business:
Once you have decided on your business structure, you can take the official steps to form your business legally. Make sure your business meets all the basic city and state requirements. You will also need a business name. Remember, a good company name goes a long way!
If you are considering an LLC as your business structure, read our blog here for a step-by-step guide on how to get one.
3. Get your Employer Identification Number (EIN):
Once you have formed your business, you will need to obtain an EIN. This is also known as a federal tax number. The FMCSA requires all applicants to have an EIN.
4. Apply for your DOT number:
A DOT number is required when applying for other authorities. It is best to get this part done as early as possible. You can apply for your DOT number by using the Unified Registration System (URS). The Unified Registration System (URS) is an online federal registration system that facilitates the registration of commercial motor vehicles (CMVs) and the drivers and companies that operate them. It is an electronic online registration system that streamlines the Federal Motor Carrier Safety Administration's (FMCSA) registration process and serves as a clearinghouse and depository of information on all major entities regulated by the Agency. You will use this same system to apply for your MC number.
You will need to provide information about your business including your legal name, address, EIN, and type of operation when applying for your DOT number.
5. Apply for Liability and Cargo Insurance:
You are required to have proof of public liability insurance within 90 days of applying for your operating authority or your authority will be removed. So, it’s better to know if you will have insurance before the end of the process. Public Liability insurance is required to receive Motor Carrier (Property) Authority, but Cargo insurance is not. However, you will be required by most industry members to have a minimum cargo insurance policy of $100,000 to move freight.
You can read more about insurance filing requirements here.
6. Apply for your MC number and submit insurance coverage:
To get your operating authority, you will need to complete an application using the Unified Registration System and pay the $300 filing fee. You will also need to submit your proof of insurance within 90 days of submitting your application. Liability and cargo insurance forms must be submitted directly (online) by the home office of the insurance company that is providing the coverage. You should contact your insurance agent to confirm they have sent the required forms. You will receive a warning letter about the 90-day deadline if the FMCSA has not received the required insurance documentation within 20 days. We recommend having your insurance ready to submit to not slow down the application approval process.
7. File your BOC-3:
The BOC-3, or blanket of coverage, designates a process agent in each state that can accept legal documents on your behalf. If you are an owner-operator, you cannot file your own BOC-3 and will need a process agent to file for you. You can read more about filing the BOC-3 form here. The BOC-3 form will need to be filed within 90 days of submitting your application to receive your MC number.
How long will this process take?
Once you complete your application and your grant letter is mailed, your application will be published in the FMCSA Register. This will initiate a 10-day protest period in which any individual can file a protest with the FMCSA stating why your company should not be issued an operating authority.
Operating authority applications completed online through the URS may take up to 20-25 business days (possibly more if subject to further review) and applications sent via US mail will take longer – 45-60 business days.
Once the FMCSA has approved your application, received proof of insurance, and received your process agent filings (BOC-3), and the 10-day protest period has ended without any protests, you will be issued your Operating Authority in the form of a certificate. You cannot begin operations until you officially receive the certificate by mail! While you technically have 90 days to submit all of the requirements, it would be wise to have them lined up and ready to go during the application process to streamline approval.
See an example of the certificate below:
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Soshaul Logistics LLC and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. It is meant to serve as a guide and information only and Soshaul Logistics, LLC does not assume responsibility for any omissions, errors, or ambiguity contained herein. Contents may not be relied upon as a substitute for the FMCSA's published regulations. You should consult your own tax, legal and accounting advisors before engaging in any transaction or operation.