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If your long-distance usage was higher than the local usage in the past but was not in April and September, this method is unlikely to return the full amount of FET owed

Landrum, SC (PRWeb) November 18, 2006 -- Byron Horner, a tax recovery expert, stated today that the estimation method approved by the IRS for businesses to use in figuring their Federal Excise Tax (FET) refund will not return all of the money owed. "There are significant problems with this method," comments Horner, president of Utility Audit Company, Inc. (UAC), a company specializing in tax recovery.

Although the IRS is allowing businesses to estimate the amount of FET paid based on a comparison between their April and September 2006 phone bills, "there is a cap on the total phone expenses a business can claim," Horner explains. "Businesses with 250 employees or less can claim 2% of their total phone expenses, while businesses with more than 250 employees can only claim 1% of their expenses."

Results of the estimation method will vary based on the usage pattern for each business and how consistent that pattern has been over the past 41 months. "If your long-distance usage was higher than the local usage in the past but was not in April and September, this method is unlikely to return the full amount of FET owed," Horner states. "The IRS admits that businesses and tax-exempt organizations have more varied phone usage patterns than individuals. Yet their estimation method only offers 2 specific months as a basis for calculating the entire 41-month refund--one month immediately before the tax ended and one month immediately after. Any large shifts between those two months in local and long-distance usage will tilt the differential percentage, which can lower the refund for the entire period."

Horner also mentions another key point: "if the differential percentage comes out to be more than 2%, the excess percentage will represent lost FET refund money. Larger businesses that are capped at the 1% differential have little choice but to invest the time and resources to do the research and claim the actual amount of FET they paid."

In order to request the actual amount of tax paid, businesses must be able to back up their claim with accurate records and phone bills for the past 41 months. "For businesses with multiple phone lines and cellular phones, this process will be extremely tedious and time-consuming," Horner explains. "They may not think it's worth the time, and opt for the IRS estimation method. However, if they do, they may very well leave money on the table." "Businesses need to know that there are tax experts and companies out there that will review and calculate their refunds in a fraction of the time, making sure they get all their money back from the IRS," Horner adds. UAC has worked with businesses in preparing FET refund claims ranging from $4,000 to $200,000.

Utility Audit Company (UAC) specializes in helping businesses and tax-exempt organizations recover taxes. As experts in utility and phone taxes, UAC has the knowledge to quickly and effectively prepare FET refund claims and help businesses get the refund that is legally owed to them by the IRS. For more information and questions about the Federal Excise Tax refund process, visit http://utilityauditco.com/html/businesses.html or call Byron Horner at (866) 457-4262. UAC also has a blog on the topic, at http://utilityauditco.blogspot.com, and encourage questions and comments from businesses and tax-exempt organizations.

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