2/28/2007

WASHINGTON - As West Virginians begin to file their 2006 tax returns, Rep. Shelley Moore Capito today urged taxpayers to check to see if they qualify for a special one-time telephone excise tax credit that could put as much as $60 back into their pockets.

Recent information released by the Internal Revenue Service (IRS) shows that out of 200,000 early returns filed so far this year by West Virginians, more than 71,000 have failed to request this one-time refund.  This amounts to $2.1 million in tax relief being left on the table for more than 71,000 West Virginians.

"This tax credit represents a small victory for taxpayers, but an important victory nonetheless," said Rep. Capito, who urged all taxpayers to not miss out on this one-time opportunity.  "The telephone excise tax repeal is long overdue and offers a unique opportunity for taxpayers to cut their tax bill and hopefully get some money back in their pockets."

The telephone excise tax, put in place in 1898 to finance the Spanish-American War, was halted last August after several federal courts ruled that the tax does not apply to long-distance telephone service as it is billed today.  Federal officials have since authorized a one-time tax refund, allowing tax payers to claim a standard credit of $30 to $60 based on the total number of exemptions claimed on their 2006 tax return. 

Taxpayers with a land line telephone or a cell phone that paid the federal excise tax on long-distance calls at any time between March 2003 through the end of July 2006 are eligible for this credit. 

In addition to the standard credit option, taxpayers who have saved their old telephone bills can deduct the total amount of excise tax they paid during the 41-month time period.  Since most taxpayers do not have their old bills or simply do not want the hassle of totaling the excise tax amount, the vast majority opt for the standard $30 to $60 credit.  Nationally, the IRS says 99 percent of taxpayers have chosen to take the standard credit. 

Capito reminded taxpayers that this credit is a one-time payment, and will not be available next year.

"This credit can only be requested on this year's tax return, and because of that it is largely unknown and unfortunately being missed by too many taxpayers.  I strongly urge everyone who qualifies to remember to request this extra credit, and to be sure to remind their friends and family to do the same."

Taxpayers who have already filed their 2006 tax return without requesting the telephone excise tax credit can still claim the credit by filing Form 1040X and completing line 15 to amend their return. 

For more information regarding the telephone tax credit, ask a tax professional, visit www.irs.gov or call the IRS toll-free at 1-800-829-1040.