Dollars and Sense
Long-distance callers due IRS refund
By DAVID UFFINGTON

Don't forget to claim your tax refund on telephone longdistance charges when you prepare your taxes. It's not often we get something good from the Internal Revenue Service, and while this isn't a gift, it is a way to get back some of the money you've paid.

In 1898, as a way to pay for the Spanish-American War, the government imposed a tax on telephone lines. After the war the tax was repealed, put back, repealed and put back again. (Over the years that tax has put $300 billion into the government coffers.) Recent court decisions convinced the IRS that it can't keep collecting that federal tax on long-distance charges.

On your 2006 individual taxes you can deduct:

$30 if you have one exemption

$40 if you have two exemptions

$50 if you have three exemptions

$60 if you have four exemptions

If you are a business or a nonprofit, you'll have to fill out a Form 8913. You'll need to gather up 41 months of telephone bills for the period from Feb. 28, 2003 to July 30, 2006. Put the amount on the form and attach it to your return. Or, you can use the IRS formula for calculating the amount. If you are self-employed and use Schedule C, yours is a more complicated calculation, combining both personal and business.

The refund includes longdistance bills for your regular landline phone, Voice over Internet Protocol (VoIP) and cell phones.

If you're not filing a tax return, you can get the refund by filing Form 1040Z-T.

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IRS Tax Changes: Before you file, go to the IRS Web site [www.irs.gov] and read about changes in the tax code that were made after the forms were printed in November. These include charitable deductions made after Aug. 7, 2006; state and local sales tax; higher-education tuition and fees, and educator expenses. If you efile, the online forms will be correct. If you use a computer software program, be sure to get the updates. If you prefer paper and pencil, visit the IRS Web site for updated information on filling out your 1040. To be safe, download new forms. Look for Publication 600 for state and local tax tables if you deduct them on Schedule A.

David Uffington regrets that he cannot personally answer reader questions, but will incorporate them into his column whenever possible. Write to him in care of King Features Weekly Service, P.O. Box 536475, Orlando, FL32853-6475 or send e-mail to letters.kfws@hearstsc.com.

(c) 2007 King Features Synd., Inc.