The FCC requires 101 9898 to charge three taxes or "contributions" as an interstate carrier. These charges will be added separately on your local phone bill. 101 9898 does not profit from these collections.
The first is a 3% Federal Excise Tax. This is computed as a percentage of all of your telecommunications call charges. For more information on this Federal Excise Tax, please read IRS FORM 720. Federal Excise Taxes are collected by 101 9898 and passed on to the United States Government.
The second is a variable Universal Service Fund fee, currently at 8.9% for the fourth quarter 2004, charged to telecommunications customers using interstate and international services. This Fund helps provide affordable telecommunications service for low income customers and customers in rural areas. It also provides discounts on Internet access for eligible schools, libraries and rural health care providers. This charge is computed as a percentage of your state-to-state and international long distance charges. For more information please visit web site www.universalservice.org. Universal Service Fund fees are collected by 101 9898 and collected by the Universal Service Administrative Corporation and distributed by the Federal government.
The third is a 3.67% Carrier Recovery Charge (CRC) applied to cover charges imposed on telecommunications carriers for the cost of other FCC-approved programs. The CRC is collected by 101 9898 and used to fund programs as directed by the Federal government. These programs are:
- The TRS Fund. Effective September 1, 2003 the NECA (National Exchange Carrier Association) implemented new collection procedures for the Interstate Telecommunications Relay Service (TRS) Fund. 101 9898 is required to collect a "contribution" and forward to the NECA.
- North American Numbering Plan Administration (NANPA) Fund. Effective September 1, 2003 the North American Numbering Plan Billing and Collection Agent (NBANC) implemented new collection procedures at the direction of the FCC for "contributions" to the North American Numbering Plan Administration (NANPA) Fund. 101 9898 is required to collect a "contribution" and forward to the NBANC.
For more information on these two funds You may go to the NECA site www.neca.org or the FCC site www.fcc.gov.
The reason that these fees or "contributions" are not included in the rates is that we do not profit from them. The charges are applied and the revenue is forwarded to the appropriate agency without any administrative charge on our part. We are required to prepare separate reports for each.
Carriers may present this information in different ways, but they apply to all carriers.
For more information, please check these links:
Your SBC (pacific bell) invoice
Your Verizon invoice