Telephone Excise Tax To Be Refunded

By: Emi FitzGerald Email
By: Emi FitzGerald Email

02-13-07
IRS officials say this refund may be the most requested in history, and they expect about 160 million people to file for it.

How do you know if you if you qualify for the refund? The answer is as simple as talking on the phone.

Tax agend Melissa Simmons says, "If you've had long distance phone service for the last 3 years, back to August 2003 until August 2006, you're eligible for the credit."

The amount of money from the credit can range from 30 to 60 dollars, depending on your number of exemptions.
The credit includes landline and wireless long distance services.
"It started as a way to fund the Spanish American War," Simmons said.

In 1898, Congress enacted the excise tax to help pay for the US Conquest of Spanish territory in the Carribbean and the Pacific.
Back then, only the wealthy could afford long distance service, and the law was repealed years after the end of the war. But it was later re-instated to fund other wars.

Federal judges decided the billing is a bit different than it was in 1898, and a significantly higher percentage of Americans pay for the service.

Simmons said, "Credits are dollar for dollar money not like a deduction where you deduct something from your tax return and then you get a tax rate at a percentage of that. It's actually dollar for dollar. So when you get back 60 dollars, you're actually getting 60 dollars."

Page two of your income tax form should have a line designated for the standard credit amount. You can also itemize your long distance bill for a more specific amount if you have paid high long distance bills.

If you don't have to file a tax return, you can still fill out the 10-40 EZ form for the credit. If you have already filed your tax return but did not ask for the credit, you still have three years to amend your return.


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