For 2006, taxpayers can request a credit or refund of amounts paid for telephone excise tax that was billed to taxpayers after Feb. 28, 2003, and before Aug. 1, 2006 (the refundable period). The refund or credit applies only on 2006 income tax returns.

Individuals may request a refund or credit on their 2006 returns by using either the actual amount of tax paid or using the following safe-harbor no-records-required amounts:

• $30 for a person filing a return with one exemption
• $40 for a person filing a return with two exemptions
• $50 for a person filing a return with three exemptions
• $60 for a person filing a return with four or more exemptions

Businesses and tax-exempt organizations may figure their refund amounts by using the Estimation Method (Please contact your tax advisor for additional information.) The refund is capped at (a) 2% of the total telephone expenses for businesses and tax-exempt organizations with 250 or fewer employees; and (b) 1% for those with more than 250 employees.