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What is it? How long has it been in existence?
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The Federal Telephone
Excise Tax Timeline |
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1898 |
Temporary tax on telephone services adopted to help fund the Spanish-American War. |
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1914 |
Long distance "luxury" telephone tax is imposed at a rate of 1 cent per call to help pay for some of the costs of World War I. |
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1916 |
Tax is repealed. |
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1917 |
Tax is reinstated at a rate of 5 cents per call once the United States enters the war. |
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1918 |
Tax is expanded to cover additional telephone services. |
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1924 |
Telephone excise tax is repealed. |
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1932 |
Tax is reinstated at per-call rates ranging from 10 cents to 20 cents, depending on the call's cost. |
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1942 |
Tax rate is changed to a flat 20 percent rate. |
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1943 |
Tax rate is increased to 25 percent. |
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1954 |
Tax rate is reduced to 10 percent. |
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1959 |
Tax rate is slated to expire in 1960. |
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1960 to 1964 |
Expiration schedule is delayed annually. |
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1965 |
As part of the excise tax reform project, the 10 percent communications excise tax is scheduled to be phased out over three years. |
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1966 |
Phase-out delayed for one year. |
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1968 |
Phase-out restructured to conclude in 1973. |
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1969 |
Phase-out delayed for one year. |
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1970 |
Schedule replaced by a 10-year plan beginning in 1973. |
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1973 |
Phase-out begins. |
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1981 |
Excise tax down to 1 percent but elimination is deferred. 1 percent is extended through 1984. |
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1982 |
Tax rate is increased to 3 percent with elimination in 1985. |
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1984 |
3 percent rate is extended through 1987. |
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1987 |
3 percent rate is extended through 1990. |
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1990 |
3 percent excise tax made permanent in 1990 |
How much is the tax?
The Federal Excise Tax amount is 3%
Which parts of my bill are affected by this tax?
Prior to July 31, 2006 the Federal Excise tax applied to all Blackfoot basic line charges, long distance charges, long distance call plan charges, personal toll free number charges, all Blackfoot EAS calls and charges, and monthly or per use calling feature charges.
Which parts of my bill are not affected by this tax?
Any one time charge or credit, or any data service one time or monthly recurring charges.
Why is this tax being repealed?
The U.S. Treasury conceded the repeal of this tax because of the changes in the way long-distance calls are billed today. The Justice Department had appealed in U.S. courts to keep the long-distance tax but was turned back several times. Both the Telecommunication Industry and Congress support the repeal of this tax.
When will it disappear from my bill?
The repeal is set to go into effect on July 31, 2006, so customers will see a difference in the “Federal Tax @ 3%” portion of their August 2006 Blackfoot statement. Services that are no longer affected by this tax are all Blackfoot long distance charges, Blackfoot long distance plan charges, Blackfoot personal toll free number charges.
Why is it still on my bill (post July 31, 2006)?
The Federal Excise Tax was repealed on Blackfoot long distance charges, long distance calling plan charges, and personal toll free number charges. The tax is sustained on Blackfoot basic line charge, all EAS calls and charges, and monthly or per use calling feature charges.
How much will tax payers get back?
Approximately $13 billion dollars will be refunded to taxpayers nationwide.
How much revenue will be lost with the repeal of this tax?
Lost revenue over the next five years is expected to add up to about $60 billion dollars nationwide.
How can I get the three year refund?
The refund will be administered by the IRS. Additional information will be available at their website www.irs.gov later this year. Refunds are to be claimed with the filing of the customer’s 2006 federal income tax return and will be issued by the IRS, not Blackfoot Telecommunications Group.
How much will my refund be?
Your tax preparation professional or the IRS will better be able to answer that question. Since the IRS will be administering and issuing the refund, you can check for further information at www.irs.gov or call 1-800-829-1040 (residence), 1-800-829-4933 (businesses), or
1-800-829-4059 (TDD) (for the hearing impaired).
When will I get my refund?
Customers will be eligible to file for refunds of all excise tax they have paid on long-distance service billed to them after Feb. 28, 2003 through July 31, 2006. Interest will be paid on these refunds. Customers will claim this refund on their 2006 tax returns. In order to minimize burden, the IRS expects to announce soon a simplified method that individuals may use.
Can I claim interest, and if so, how far back can I go?
Interest will be paid by the IRS on these refunds. Customers can receive a refund of taxes and interest from March 1, 2003 through July 31, 2006.
Why is my refund held only to three years?
The refund is held to three years due to a statute of limitations. A statute of limitations is a law that sets the time within which parties must take action to enforce their rights.
Will this be an on-going refund?
This will be a one time refund, since after July 31, 2006 customers will no longer pay the Federal Excise Tax on all Blackfoot long distance charges, Blackfoot long distance plan charges, and Blackfoot personal toll free number charges.
What if I didn’t keep copies of my bills for the past three years? Will you provide me with copies?
The IRS and Treasury Department will soon announce a simplified method for requesting a refund. Blackfoot Telecommunications Group will be able to provide customers with three months worth of past bills at no charge. If a request of more than three months worth of statement copies is made, a $30.00 per hour and $.10 cent per page charge will apply (minimum ˝ hour time plus per page charge). These charges can be billed on current working service accounts. If a customer no longer has a working account with Blackfoot Telecommunications Group, payment in full will be requested prior to shipment of documentation.
Can you figure out how much of a refund I’ll get?
Your tax preparer or the IRS will better be able to answer that question.
What if I have/had a cell phone some time from March 2003 through July 31, 2006; can I get a refund on that service as well?
The repeal of the Federal Excise Tax applies to all telephone services. Please check with your mobile phone provider for further details.
Where can I find additional information?
More information can be found in IRS Notice 2006-50. It will also be published in Internal Revenue Bulletin 2006-25, dated June, 19, 2006. On the web, go to www.irs.gov or call 1-800-829-1040 (residences), 1-800-829-4933 (businesses), or 1-800-829-4059 (TDD-for the hearing impaired).
| Last update: 08:58 AM Wednesday, July 15, 2009 | Print |
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