Phone Excise Tax Refund

published January, 2007

Apparently, phone companies collected a tax from March ’03-August ’06 that was deemed unconstitutional, and they’re going to refund it on 2006 income tax returns. 

Individuals can figure the exact tax, or do a “standard” of $30 for a single person, $40 for a couple, $50 or $60. This tax is refundable. 

For businesses, you can collect the exact amount if you have 41 phone bills, or you can use the formula based on a ‘sample.’ You’ll need a copy of your April ’06 and September ’06 bills, AND to know the amount you spent by month for the 41 months, or a total paid for the each of the years 03-06—maybe a QuickBooks report? 

For AT&T, this tax appears to have been collected on Long Distance. Cingular appears to have collected on the whole bill.

I did my business phone bills and I’m getting $131 refunded from the IRS, which is weird on an “S” Corp return.