Extension of filing period and safe harbor for certain taxpayers for refunds of the excise tax on toll telephone service

(a)

Extension of filing deadline

(1)

In general

Any overpayment attributable to nontaxable service billed after February 28, 2003, and before August 1, 2006, may be allowed— (A)as a credit against any taxes imposed by subtitle A of the Internal Revenue Code of 1986 for any taxable year ending after December 30, 2006, and before January 1, 2008; (B)as a credit against any taxes imposed by chapter 21 of such Code for any period ending after the date of the enactment of this Act and before January 1, 2008; or (C)as a refund to the taxpayer under such rules as prescribed by the Secretary. (2)

Social security trust funds held harmless

The Secretary of the Treasury shall, from time to time, transfer— (A)from the general fund to the Federal Old-Age and Survivors Insurance Trust Fund an amount equal to the amount credited under paragraph (1)(B) which is attributable to taxes imposed under sections 3101(a) and 3111(a) of the Internal Revenue Code of 1986; and (B)from the general fund to the Federal Hospital Insurance Trust Fund an amount equal to the amount credited pursuant to paragraph (1)(B) which is attributable to taxes imposed under sections 3101(b) and 3111(b) of such Code. (b)

Safe harbor

(1)

In general

In the case of an overpayment described in subsection (a) with respect to an eligible taxpayer, at the election of the taxpayer, in lieu of the actual amount of nontaxable service billed after February 28, 2003, and before August 1, 2006, the amount of the overpayment shall be an amount equal to— (A)$50 in the case of an eligible taxpayer with an adjusted gross income for the most recent taxable year of less than $100,000; (B)$100 in the case of an eligible taxpayer with an adjusted gross income for the most recent taxable year of at least $100,000 but less than $200,000; (C)$150 in the case of an eligible taxpayer with an adjusted gross income for the most recent taxable year of at least $200,000 but less than $300,000; (D)$200 in the case of an eligible taxpayer with an adjusted gross income for the most recent taxable year of at least $300,000 but less than $400,000; (E)$250 in the case of an eligible taxpayer with an adjusted gross income for the most recent taxable year of at least $400,000 but less than $500,000; and (F)$300 in the case of an eligible taxpayer with an adjusted gross income for the most recent taxable year of at least $500,000. (2)

Eligible taxpayer

For purposes of this subsection, the term eligible taxpayer means any taxpayer who— (A)is— (i)an entity, or (ii)an individual who has at least $25,000 of gross income from a trade or business for the most recent taxable year; and (B)was billed for nontaxable service for any period beginning after February 28, 2003, and before August 1, 2006. (3)

Election

(A)

In general

The election made under this subsection shall be made in such manner as the Secretary may by regulations prescribe. (B)

Special rule for claims relating to preceding years

No election may be made under this subsection with respect to an overpayment described in subsection (a) on any claim for a refund or credit filed after the date of the enactment of this Act if the taxpayer has previously made a claim for a refund or credit with respect to such overpayment before such date. The preceding sentence shall not apply if the claim for a credit or refund is made on a return amending the claim filed before the date of the enactment of this Act. (c)

Nontaxable service

For purposes of this section, the term nontaxable service shall have the meaning given to such term under Internal Revenue Service Notice 2006–50, 2006–25 I.R.B. 1141.