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Trusted local news leader for Kingman, Arizona & Mohave County
7:44 AM Sun, Nov. 18th

Millions of dollars in tax refunds going unclaimed

KINGMAN - In an interesting turn of events, the Internal Revenue Service is trying to give money away, but many don't seem to be interested.

The federal government is offering residents a refund on long distance telephone taxes.

The government placed a luxury tax on long distance telephone service in the 1890s to help pay for the Spanish American War.

According to the IRS' Web site, several court cases have determined that the tax no longer applies to today's long distance service.

The IRS is offering a one-time-only standard refund of between $30 and $60 to anyone who had a phone with long distance service between February 2003 and August 2006. The refund applies to long distance services for cell phones, Voice Over Internet Protocol or Internet phone services such as Vonage, as well as regular land line phones.

According to the Web site, the IRS cannot refund taxes that were paid more than three years before the refund program was announced. That's why residents can only collect a refund from February 2003 to August 2006.

Local IRS spokesman Bill Brunson said almost one-third of the tax returns filed by Arizona residents for the 2006 tax year did not request the Telephone Excise Tax Refund. That's left nearly $7.9 million in unclaimed money in the IRS coffers.

The department expects to pay back around $10 billion to taxpayers across the nation. So far, more than 14 million taxpayers have not requested the refund.

"We're baffled why we can't seem to give away money," Brunson said. "It's not a lot of money, granted, but it is a refund."

The IRS has tried to make it easy for residents to claim their refunds by placing a line on 2006 tax forms. Filling in that line gives a standard deduction. Brunson said the deduction is based on a calculated amount, basically the average of all phone bills from that time period.

Residents can collect a bigger refund if they are willing to work a little harder. They'll have to dig up those old phone bills from February 2003 to August 2006 and use tax form 8913 to add up the taxes and figure out their refund.

Even residents not required by law to file a tax return can get the Telephone Excise Tax Refund if they had a phone with long distance charges during that time period.

Brunson said residents that don't have to file a tax return can use form 1040EZ-T to request the refund. There are several organizations, such as AARP, that offer free volunteer tax assistance as the April 16 deadline to file approaches.

For more information, contact the IRS at (800) 829-1040 and press 6 for information on the telephone tax refund, or check out the IRS' Web site at www.IRS.gov.