On 7/29/2013 8:22 AM, Mike Hammett wrote:
A lawyer once told me that you aren't required to file with USAC for
under $10k, but there is nothing preventing you. Don't mess around
with the who does USF when dance, just do it from the beginning yourself.
That doesn't sound right to me. If you are required to file except for
being under the $10k, then you are expected to file a 499-A annually.
You may not however elect to pay directly. There are small carriers
asking the FCC to let them waive de minimis status (which can under some
circumstances be a disadvantage), but so far that hasn't been granted.
-----
Mike Hammett
Intelligent Computing Solutions
http://www.ics-il.com
------------------------------------------------------------------------
*From: *"Fred Goldstein" <[email protected]>
*To: *[email protected]
*Sent: *Sunday, July 28, 2013 6:06:13 PM
*Subject: *Re: [WISPA] VoIP Taxes, Fees, & Insanity
On 7/28/2013 2:20 PM, Jeremy wrote:
So while I am de minimus should I not be charging a USF fee? You
stated that I cannot charge more than I pass along but if I pass
along nothing until I am at the 10K mark then am I not supposed to
bill it until that point?
Carlos has good advice -- consult a lawyer. (I'm not a lawyer but I
play an engineer on TV.) I just checked with one who could not render
actual "advice". Rather, he explained, "This is one of the mysteries
of USF."
The FCC forgot about this case when they did the rules. So the usual
practice seems to be to collect the fees. You might after all be
passing them along to your wholesale provider, who is charging USF to
you. But if you do go over the $10k limit, then you could owe
retroactively, and in that case you want the money in the bank! So
unless they've clarified this in the instructions on the Form 499s (be
warned; they do that sometimes, and you don't know the rule until you
read the new fine print), you can pass along the fee you would be
collecting under safe harbor, and apply it to the USF charges you're
being hit with.
I don't think these crazy fees are a reason to avoid voice services,
but they are a pain to administer. The FCC is terrible about writing
clear rules.
On Sun, Jul 28, 2013 at 9:42 AM, Fred Goldstein
<[email protected] <mailto:[email protected]>> wrote:
On 7/28/2013 12:46 AM, Jeremy wrote:
From what I read it seems like you can collect whatever
you want directly from your customers but it may be
considered as income and taxed as such. So you can't
really pass it on as a direct fee and bypass your income
tax liability for it.
No. Federal billing rules say that you cannot collect more on
your retail bill for FUSF than you pass along. No markups
allowed. Most of the other charges can also be passed along
one for one, but state rules could vary.
But the rate is not exactly what you think. The Federal USF
rate is calculated as a percentage, changed quarterly (it has
gone over 17%), of your interstate telecommunications service
billing. If you are providing local telephone service, that
line item is not subject to USF as it is intrastate, not
intersate. Internet access is not subject to USF as it is
information service, not telecommunications service. The tax
was meant to apply to long distance calls, which were a lot of
money back in the day.
If you are (as is the norm nowadays) providing a service that
does not charge explicitly for interstate long distance, then
you have two options. There is a "safe harbor" of 64.9%,
wherein that percentage of the total phone package is deemed
interstate. So if you sold it for $10/month, the tax would be
applied to $6.49 of it. This number was computed back when
VoIP services were primarily used as cheap dial-around long
distance, not as primary lines, so the "PIU" (percentage
interstate use -- this number comes up a LOT in telecom
billing) was high.
You can also compute what percentage of your calls are
actually interstate, and pay USF on that percentage of the
bill. This involves filling out the Form 499-Q's correctly,
but it is the norm nowadays.
Bear in mind that there is a "de minimis" rule. If you would
owe less than $10k/year, then you only file Form 499-A
(annual, vs. quarterly), and don't pay anything. BUT you then
are treated as a retail customer of your wholesale
provider(s), and *they* collect USF on what they bill you. If
you are no de minimis, and do actually pay USF, then you tell
that to your providers, who have to verify it against FCC
records, and then they don't charge you USF. It's sort of
like a retailer's exemption on sales tax; it's only collected
once. Note that this whole system is on the docket at the FCC
and they're still thinking about how to revise it, but don't
seem to have a consensus, so they're just putting it off.
On Sat, Jul 27, 2013 at 10:26 PM, Chris Fabien
<[email protected] <mailto:[email protected]>> wrote:
That looks about right, it varies by state/locality of
course. We collect Federal USF, State use tax, state
and county E911. The USF you get to pocket until your
required contributions are $10k/year - under that you
are considered "de minimus" and just have to file the
annual form.
When we set up our billing the Telecom Relay Fund
passed under our radar so now we're just paying for
that out of pocket. I'm not sure if you are allowed to
collect that specifically from your customers as well.
On Sun, Jul 28, 2013 at 12:20 AM, Jeremy
<[email protected]
<mailto:[email protected]>> wrote:
I am attempting to figure out all of the taxes for
VoiP and the main thing that has me confused is
the Universal Service Fund. It seems that my
state (Utah) has a USF of 0.45%
http://www.psc.state.ut.us/utilities/telecom/documents/Rule%20746-360%20amendment.rtf
Then it also seems like the Feds want 15.1%??
That is huge!
http://www.fcc.gov/encyclopedia/contribution-factor-quarterly-filings-universal-service-fund-usf-management-support
Then there is sales and use tax of
*State Sales & Use -* 4.7%
*Municipality Sales & Use - *varies - see
http://tax.utah.gov/salestax/rate/13q3combined.pdf
Then we have E911:
*E911 State -* .08
*E911 County -* .61
*Poison Control -* .07
*-------------------------------*
*Total for E911 -* .76
Then, since October 2011 we are also liable for
the *Telecommunications Relay Fund* - .06
http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-11-150A1.pdf
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--
Fred R. Goldstein fred "at"interisle.net <http://interisle.net>
Interisle Consulting Group
+1 617 795 2701 <tel:%2B1%20617%20795%202701>
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Interisle Consulting Group
+1 617 795 2701
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Interisle Consulting Group
+1 617 795 2701
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