Federal Tax Refund Confusion

Monday, February 12th 2007, 10:26 am
By: News On 6

Tax deadline day is in April, but a federal tax refund is causing some problems for taxpayers this month.

The IRS says there is a lot of confusion over the federal phone excise tax. If you've had long distance on your cell phone or landline from February 2003 to August 2006 you can claim an instant tax refund on your federal tax return. It's line 71 on the 1040 form. Anyone filing single gets $30. A couple filing jointly gets $40, plus $10 per dependent.

Now, you can claim the exact amount of excise tax paid, but you have to have hard copies of those 41 past bills. And IRS spokesman David Stell says the government won't tolerate fraud. "We've seen instances where people have requested $30,000 worth of telephone excise tax refund, that's an incredible amount and that seems like an unreal amount of long distance calls."

Tax fraud carries a penalty of five years in jail and a $500,000 fine.