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Telephone Excise Tax

The Internal Revenue Service announced that effective August 1, 2007, it will stop collecting the federal excise tax on long-distance telephone service. Taxpayers will be eligible to file for refunds of all excise tax they have paid on long-distance service billed to them after Feb. 28, 2003.

Taxpayers will claim this refund on their 2007 tax returns. In order to
minimize burden, the IRS expects to announce soon a simplified method that
individuals may use.

The IRS announcement does not affect the federal excise tax on local
telephone service, which remains in effect. Likewise, various state and local
taxes and fees paid by telephone customers are also unaffected.

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Source: irs.gov