Can You Pay Me Now? Verizon Refunding Taxes in New York

Daily Tax Report: State provides authoritative coverage of state and local tax developments across the 50 U.S. states and the District of Columbia, tracking legislative and regulatory updates,...

By Gerald B. Silverman

Verizon Wireless has been sending some customers refund checks after a change in New York state tax policy.

The change impacted what comprises a “local telephone business” for purposes of a gross receipts tax surcharge on wireless companies.

However, neither Verizon nor the state Department of Taxation and Finance would release details on the amount of the refunds.

A toll-free answering service provided to customers by the company said “the refund relates to a determination made by the State of New York that deemed Verizon Wireless as not being subject to New York State Section 184 gross receipts taxes.” Verizon received a refund of the taxes paid between March 2006 and August 2014, the company said. It’s now passing the refund along to New York customers.

James Gazzale, a spokesman for the tax department, told Bloomberg BNA that the department can’t discuss any specific taxpayer’s refund. He couldn’t say whether other wireless companies have applied for or received the refund.

No Longer Applies

The tax department issued guidance in 2015 on a change in policy regarding the Section 184 tax, which is levied on telecommunication companies. It said the tax would no longer apply to wireless providers that provide service within or between local access and transport areas (LATA).

“In 2000, the Tax Department issued advisory opinion TSB-A-00(18)C, concluding that wireless communications service providers that provide intra-LATA and inter-LATA communications services are conducting a “local telephone business,’” according to the 2015 guidance memo.

“Since the industry as a whole has changed, this conclusion no longer represents the view of the Tax Department,” the memo continued. “If a mobile telecommunication service provider has previously paid the tax imposed under Tax Law Section 184, and the statute of limitations for the tax year is open, the provider may be entitled to a refund.”

To contact the reporter on this story: Gerald B. Silverman in Albany, N.Y. at GSilverman@bna.com

To contact the editor responsible for this story: Jennifer McLoughlin at jmcloughlin@bna.com

For More Information

Text of the 2015 guidance is at http://src.bna.com/rQe.

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