Phone tax refunds, Updating QuickBooks, New Years Resolutions, more

Welcome to 2007! The holidays are behind us and a new year lies before us. We look to 2007 with great anticipation and optimism. The prevailing mood here and with many of the clients we are speaking with is one that senses 2007 is going to be a great year.

We are going to try to get 2007 off to a running start. This month, we have news about how you can earn a refund of taxes you have been paying on your phone bill, some new tips to increase your effectiveness with QuickBooks, some ideas to make your new year’s resolutions more meaningful and more.
Thank you again for reading the Rodman Report. Your feedback is always welcome! Let us know how we can make this resource even more valuable.

All the best from the team at Rodman & Rodman, P.C.

Get a refund of your phone excise taxes!

Karl Schramek CPA MST

Here is how… refund

The IRS recently stopped collecting the Federal Excise Tax (FET) on long- distance telephone, bundled service plans and most cellular phone services effective August, 2006. The FET rate was 3% of the charges billed for these services. The FET will continue to be applied to local-only service. Both individuals and companies will be eligible to file a refund on FET charges billed and/or paid from March, 2003 through July, 2006. Individuals and companies will claim these refunds on their 2006 Federal Income Tax returns filed in 2007. Interest will be paid on these refunds.

How Do You Claim this Refund?

Individuals have the following two options:

Option 1: (Actual Amount) Calculate the FET paid from your 41 monthly telephone bills from March, 2003 through July, 2006. Report the FET paid on IRS Form 8913 summarized quarterly and segregated between FET paid for long-distance & bundled services, and compute interest due on the tax refund.

Option 2: (Standard Refund) There is standard refund available based on the number of exemptions claimed on your 2006 federal income tax return as follows: $30 for one exemption, $40 for two exemptions, $50 for three exemptions, & $60 for 4 or more exemptions. Form 8913 is not required for taxpayers electing this option.

FYI: If you know anyone who is entitled to this FET refund but in not otherwise required to file and federal tax return, the IRS has issued Form 1040EZ-T specifically for these circumstances.

Businesses have the following two options:

Option 1: (Actual Amount) Calculate the FET paid from your 41 monthly telephone bills from March, 2003 through July, 2006. Report the FET paid on IRS Form 8913 summarized quarterly and segregated between FET paid for long-distance & bundled services, and compute interest due on the tax refund.

Option 2: (Estimation Method) Businesses and tax-exempt organizations (including certain businesses reported on schedule C, C-EZ, E, F or Form 4835) can calculate their refund by comparing two telephone bills from this year to determine the percentage of their telephone expenses qualifying for this refund. The bills they should use are the bill with a statement date in April, 2006 and the bill with a statement date in September, 2006. They must first figure the telephone tax as a percentage of their April, 2006 telephone bills (which included the excise tax for both local and long-distance service) and their September, 2006 telephone bills (which only included the tax on local service). The difference between these two percentages should be multiplied by the telephone expenses incurred during the months March, 2003 through July, 2006 (reported quarterly on Form 8913) to determine the amount of their refunds. For taxpayers using the estimation method, the refund is capped at 2 percent of the total telephone expenses for businesses with 250 or fewer employees. The refund is capped at 1 percent for those with more than 250 employees.

FYI: Businesses with gross receipts for the tax year of $25,000 or less may not use the Estimation Method. An individual taxpayer may not combine the Standard Refund with a credit for Actual Amounts related to business telephone expenses. Individual taxpayers claiming a refund FET paid for multiple businesses (such as more than one schedule C and/or E, etc.) should file only one Form 8913 reporting the telephone expenses and FET for all businesses in total. Individual taxpayers may use the Estimation Method if the combined gross receipts from all the businesses reported on their Form 8913 is greater than $25,000.

Virtually all of our clients and friends are entitled to some form of refund, but you will have to follow the above steps to receive yours. Please drop me a line at or give me a call if you have any questions.

Are you updating your QuickBooks?

by Kathy Parker CPA

Make updating a habit! QuickBooks

Now that everyone has upgraded to QuickBooks 2007 (hint hint), there is an important housekeeping task that you should not forget: Updating your QuickBooks for the latest software updates, fixes, patches and security risk prevention. QuickBooks makes this pretty simple. By clicking “Help” on the toolbar, one of your choices is to “Update QuickBooks”. All you do is follow the prompts and you will be done in a very brief amount of time. You have the choice when updating QuickBooks to turn on automatic updates, which is a nice feature. My only concern is that many clients ignore the notification that updates are available, largely because it seems inconvenient at the time to do the updating. Due to the nature of some of the updates, I strongly recommend that you simply invest the few moments to accept the updates as they appear from QuickBooks. Though you may have to restart your computer, my experience has shown that the benefits far outweigh the cost of time.

One effective method used by many clients is to schedule a time and a day to perform updates regularly. Make this no less frequent than weekly. You can always check to see which updated version of QuickBooks you are on by pressing F2. Many of the updates are fixes to problems reported to QuickBooks by users like yourself. You may find that a problem you have been having is addressed in a given update, so please don’t hesitate to assure you have the latest software downloaded.
Email me at if you have any questions.

Put It In Writing

by Larry Rice CPA

Want to get more accomplished in 2007? Write it down!

Do you have New Years Resolutions for your business? There is a simple way to accomplish a lot more of them in 2007 than you did in past years: Write it down. If you do so, you just improved your chances of achieving your goals significantly. It is simply human nature at work. When we write things down, we tend to remember them better, and act on what we have written down more consistently. Here are my suggested steps to help with achieving your business resolutions for 2007:

1. Write it down – As I said above, get that resolution in writing.
2. Put it where you can see it – Make multiple copies of your resolutions and put them where you can see them from your desk, to your home, even stick a copy in your wallet. The constant reminders will help nudge you.
3. Share your list with someone close to you – A huge step in making resolutions happen is to have someone to hold you accountable for your goals. Don’t let the person you choose be someone who will take it easy on you. Plan to meet with them a couple of times during the year for the express purpose of checking on your progress. If possible, set up the meetings now for the rest of the year.

This year can be a breakout year for you, and it starts with planning to have that great year and living up to your plan. Good luck!

Do You Have Events That Require a Speaker?

by Larry Rice CPA

We can help if your business/industry group/civic organization needs a speaker… speaker

Often we find that our clients are involved in a variety of organizations related to their business. This could be in the form of an industry trade organization, a chamber of commerce, a networking group or some other civic organization. When these groups meet, often they invite speakers from the outside who can deliver speeches to those in attendance on subjects that are of importance to that group. Often these groups struggle to get speakers who are a good fit.
We’d like to help. I have over 15 years of speaking experience talking to small business owners and their employees on a variety of subjects. I have a number of fixed subjects that I can speak on, and often I can tailor my speech to issues that are affecting a given industry. John McGovern, one of the principals at Rodman & Rodman and a business valuation specialist, often speaks to groups about valuing their business and how to seek out qualified buyers. Both John and myself encourage questions and input from our audience.

I will be happy to discuss your needs with you. Please feel free to give me a call at 617.965.5959 or you can email me at Also, see the link below for more information about our speaker programs.


Rodman CPAs is now BerryDunn. We're thrilled to share our news!

As of July 1, 2019, Rodman CPAs has merged with BerryDunn to deliver more tax, assurance, and consulting services to businesses in New England. We are excited to partner with a firm that shares our commitment to attracting and retaining the highest quality people who will continue to offer you exceptional, personalized client attention.

To learn more about our services and the industries that we serve please visit

For current Rodman clients seeking to make a payment, please contact Kathy Bautze directly at 617.965.5959x225.

You may also continue to access your secure client portal at