In May 2006, the IRS announced that tax-exempt organizations who paid the long-distance telephone excise tax can request the refund on their 2006 federal income tax returns. To request a refund, tax-exempt organizations must complete Form 8913, "Credit for Federal Telephone Excise Tax Paid." To complete this Form, tax-exempt organizations may determine the actual amount of refundable long-distance telephone excise taxes they paid for the 41 months from March 2003 through July 2006, OR use a formula to figure their refunds. Tax-exempt organizations must attach Form 8913 to the 2006 Form 990-T (the form used for tax years beginning in 2006).
The refund is capped at 2% of the total telephone expenses for tax-exempt organizations with 250 or fewer employees, and at 1% for those with more. Most organizations in this category are able to figure the actual amount paid in long-distance excise tax. However, there is a formula that provides a more limited, but simpler approach for those large employers that wish to use it.
Click here for the worksheet that will assist in calculating the excise tax. Submit the completed worksheet, along with your tax information, to your Berry Dunn tax specialists. Completing the worksheet prior to your 2007 fiscal year-end, will make filing your Form 990 quicker and will get you a refund too. We cannot say if the refund will be a lot or a little, since each organization's usage will be different, but every little bit helps towards your mission!