Friday, Debtember 15, 2006
A one time tax break
When it comes time to prepare and file your 2006 tax return, make sure you don't overlook the “federal excise tax refund credit.” You claim the credit on line 71 of your form 1040. A similar line will be available if you file the short form 1040A. If you have family or friends who no longer file a tax return AND they have their own land phone in their home and have been paying a phone bill for years, make sure they know about this form 1040EZ-T.
What is this all about? Well the federal excise tax has been charged to you on your phone bill for years. It is an old tax tha t was assessed on your toll calls based on how far the call was being made and how much time you talked on that call. When phone companies began to offer flat fee phone service, challenges to the excise tax ended up in federal courts in several districts of the country. The challenges pointed out that flat fee/rate phone service had nothing to do with the distance and the length of the phone call. Therefore, the excise tax should/could not be assessed.
Via Shadesong, A Geek in Beantown: Special One Time Tax Credit on 2006 Tax Return for Excise Tax
Not only will I have to remember this for April 15th, but I'll also need to check my cell phone bill—I seem to recall some rather suspicious looking taxes on that.
