Millions of Taxpayers Failing to Claim Telephone Tax Refund, Says IRS

An estimated 30 percent of taxpayers have yet to claim their one-time refund.

Richard R. Hammar, Attorney, CPA
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Church Finance Today

Millions of Taxpayers Failing to Claim Telephone Tax Refund, Says IRS

An estimated 30 percent of taxpayers have yet to claim their one-time refund.

Richard Hammar

The IRS is urging taxpayers to determine if they qualify for the telephone excise tax refund after preliminary data revealed that more than 10 million early filers did not request the one-time refund. That’s about 30 percent of all taxpayers. The government stopped collecting the long-distance excise tax last August after several federal court decisions held that the tax does not apply to long-distance service as it is billed today. Federal officials also authorized a one-time refund of the federal excise tax collected on service billed during the previous 41 months, stretching from the beginning of March 2003 to the end of July 2006. The tax continues to apply to local-only phone service.

To make the refund easier to figure, the government established a standard refund amount, based on personal exemptions, ranging from $30 to $60. If taxpayers have phone bills and other records, they can request the actual amount of excise tax paid. Though using the standard amount is optional, it is easy to figure and approximates the eligible amount for most individual taxpayers. Taxpayers only have to fill out one line on their return, and they don’t need to present proof to the IRS. IR-2007-040.

This article first appeared in Church Treasurer Alert, April 2007.

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations." Due to the nature of the U.S. legal system, laws and regulations constantly change. The editors encourage readers to carefully search the site for all content related to the topic of interest and consult qualified local counsel to verify the status of specific statutes, laws, regulations, and precedential court holdings.

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