ap economics notes

ap economics notes

The government's discovered that sometimes you can't give money away. After losing a series of tax decisions involving the federal 3% telecommunications excise tax, the IRS conceded defeat and agreed to refund over-collected telecommunications taxes. According to a Treasury Inspector General Report ("Report") issued on April 24, 2008, the telephone excise tax refund was the most wide-reaching tax refund in the history of the IRS, estimated to affect between 13.9 and 15.9 million business taxpayers.

Despite the enormity of the refund program and substantial outreach efforts by the IRS, the Report indicates that only 5.6% of eligible businesses participated and only 17.5% of the $5 billion in potential refunds were claimed by businesses. Put another way, of the $5 billion collected over $4 billion is still owed to businesses and 94% of businesses are still eligible for refunds.

While praising the IRS outreach efforts, the Report notes "we believe a significant amount of the telephone excise tax collected could go unrefunded, and many taxpayers might still be eligible to file a claim."

Even though the taxes collected relate to the period March, 2003 through July 2006 (41 months), the IRS developed a procedure to toll the normal statute of limitations, making calendar year taxpayers eligible for refunds 3 years from filing their 2006 income tax return. To request the excise tax refund, taxpayers were to file Form 8913 with their 2006 income tax return. For those who missed the credit or understated the credit, Form 8913 should be filed with an amended return to obtain a refund. Eligible taxpayers include corporations, S-corporations, partnerships and tax exempt entities.

Businesses may use either the actual or the estimation method. For business with 250 or fewer employees, the estimation method allows up to a 2% credit based on telecommunication expenses for the 41 month period. For businesses with more than 250 employees, the estimation method probably severely understates the refund amount by capping the credit at only 1% of telecommunication charges. The actual refund method is usually over 2.5% but requires more analysis of the underlying communication charges and taxes imposed by the specific telecommunication carriers. Communication charges are not limited by the manner of delivery so that in addition to land lines, cell phones, VoIP also qualify for refunds. Refunds are further increased by interest on the tax payments dating back to the time of payment over the 41 month period.

The Report noted that the IRS had competing objectives in administering the program: 1) minimize taxpayer and IRS burden with requesting, processing and paying the refunds; 2) minimize refunds in excess of taxes collected; and 3) discourage overstated refund requests. While the IRS encouraged taxpayers to file for refunds, it also warned against fraud and established screens to help identify refund claims that appeared to be overstated.

Attempting to explain the low level of business participation in filing refund claims, the Report noted several possible explanations, including: 1) perception that work and associated fees outweighed the amount of credit; 2) incorrect perception that telephone expense would have to be reversed from prior years adding additional tax preparation expense; 3) concern that they would not be able to provide the necessary records needed to support the credit claim; and, 4) businesses and many tax preparers were not aware of the credit.

The Report included recommendations to the IRS for improvement including improving the screening criteria to better identify potentially fraudulent claims and shifting resources for future programs to optimize the effectiveness of its mission. The most alarming recommendation of the Report asked that the IRS contact taxpayers and tax preparers who did not claim the credit to find out why the refunds were not claimed. The IRS agreed with this recommendation and indicated it would work with Treasury to better understand why the telecom excise refund tax wasn't being claimed.

Although counter intuitive, it's clear from the Report that the IRS is interested in businesses obtaining their telecom excise tax refund. The good news for businesses and the IRS is that with a three year statute of limitations for making the claims, both the IRS and businesses can still accomplish the telecom excise tax refund program goals.

About the Author:

Jeffery Morris invites you to get an estimate of your business federal and state telecom excise tax refunds by contacting him at http://phonetaxrecovery.com where you can enter some basic information and get a refund estimate within 24 hours.

(c) Copyright - Jeffery L. Morris. All Rights Reserved Worldwide.

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Can I go to Harvard with no honors classes freshmen year?

I am going to be a Freshmen this coming September and my schedule is as follows

Yes, of course it is! This part is important though:
Do well in them (get all a's) and don't rely on non-honors courses to get you into a high level school. They WILL look at honors and ap (especially ap) courses in the next 3 years.

Just to warn you, I know you dont want to hear this because theres not much you can do about it, but you really should be in a higher level math class. I took geometry in 8th grade (and all the honors courses i could take the last 2 years), and I most likely wont get into harvard. Just warning you.

All in all, talk to someone from harvard. They will have information to help you on their website, so check them out there.

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