The IRS is offering taxpayers who are filing their 2006 income tax returns a one-time only credit on federal telephone excise taxes paid. You can request the excise tax credit in two ways. You can use the standard rate, or you can use the actual rate. There are requirements and stipulations, however, in order to receive this tax refund. – regardless of what refund method you decide to choose.
First, you had to have paid long distance telephone or bundling excise taxes for the period from February 28, 2003 to January 31, 2006.
“You mean I have to go through all my old phone bills to find 40 plus months of excise taxes I paid?” you may be asking. If you choose to, you can.
However, there is a standard rate that you can apply for. This standard rate is based upon the number of exemptions you are claiming. Here is the standard tax credit rate:
If you claim one exemption: $ 30
If you claim two exemptions: 40
For those claiming three exemptions: 50
If you claim four exemptions: 60
As you can see, the telephone excise tax credit has a limit of $60 per household. Even if you have more than four exemptions you normally claim, you will not receive more than $60 for the telephone excise tax refund.
Business owners need to use a different set of procedures for claiming their tax credit. This is because the one-time telephone excise tax credit applies to individual taxpayers only. Go to the IRS website for more information on these procedures.
The purpose of the standard rate is to assist taxpayers from having to figure out the actual amount of the telephone excise tax they paid during the affected timeframe.
However, if you choose to file using the actual amount you paid for telephone excise tax, you can. Of course, you will need to gather all your applicable telephone bills for that time period. Add up all the telephone or bundling excise tax you paid on your long distance bill. Then, when you have a total, put this total on IRS Form 8913. This is the form you will use to calculate the actual amount of your credit. Put the calculated amount on the proper line of whatever Form 1040 you are filing. For instance,
- Form 1040 will have it on line 71.
- Form 1040A will be line 42.
- Form 1040EZ will be line 9.
Then, attach Form 8913 to whichever Form 1040 you file. The Form 8913 must be attached to your 1040 for you to get this tax credit.
Nonfilers take note: Even you do not need to file a 2006 income tax return, you still can request this one-time tax credit. You just need to fill out IRS Form 1040 EZ-T if you want to receive the standard tax amount. (You will need to fill out IRS Form 8913 and attach it to Form 1040EZ-T if you want the actual rate amount).
You can pick up whichever tax form applies to you wherever you normally get your IRS income tax forms. For instance, online at the IRS website at www.irs.gov, by phone, or at local locations. Local locations would include libraries, post offices, and others.