Phone Bills Too High? A Tax Refund Will Help Ease The Pain.

This is the one time that a big phone bill may work out to your advantage. The IRS is granting a tax refund to give back money collected for federal excise taxes on long-distance phone calls since 2003. It allows a standard refund you can claim on your tax return. According to an article in the Arizona Republic the standard amounts are based on the number of exemptions you take, listed below:

1 exemption – $30 refund
2 exemptions – $40 refund
3 exemptions – $50 refund
4+ exemptions – $60 refund

However, the federal excise tax is charged as a percentage of your phone bill. So if you run up high bills every month, you may be better off filing a refund for the amount of the tax you actually paid between Feb. 28, 2003, and Aug. 1, 2006.

Of course this means that you have to go through all those long-distance phone bills and add up the total; but the higher your bills the wiser it may be. One thing to note is that you have to file Form 8913 with the IRS if you calculate your actual taxes paid instead of taking the standard refund. See the IRS website for more information.

Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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