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AT&T Forced to Refund $1 Billion
Violated the Tax Freedom Act With Incorrect Tax Collection
A class action settlement is going to force AT&T to track down nearly $1 billion in incorrectly collected taxes. According to the FAQ by the law firm handling the case (pdf), AT&T violated the Internet Tax Freedom Act -- which expressly bans taxing Internet access -- by collecting a billion dollars in taxes, fees and surcharges on smartphone plans, laptop connect cards and pay-per-use data services. AT&T has agreed to stop charging the taxes, and is responsible for preparing and processing refund claims for taxes forwarded to various state or county municipal taxing agencies. AT&T states they forwarded all this collected money to these agencies (though we're guessing there's no book audit coming to verify), and is now responsible for getting these funds back and redistributing them to consumers. Granted, AT&T's recent Supreme Court victory means AT&T will eventually be barring consumers from participating in class actions like this one using contract fine print.
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gigahurtz
Premium Member
join:2001-10-20
USA

gigahurtz

Premium Member

Great!

I'll get refunded the tax that they owe me and they'll raise their "fees" to cover the costs of having to track this information down.

Great Indeed
@bellsouth.com

Great Indeed

Anon

Re: Great!

Whatever happened to the "cost of doing business"... strike that, it doesn't exist.

We just have to wait for the rest of the competition to be in-place after the merger for the prices to get better, right?

firephoto
Truth and reality matters
Premium Member
join:2003-03-18
Brewster, WA

firephoto

Premium Member

Re: Great!

said by Great Indeed :

Whatever happened to the "cost of doing business"... strike that, it doesn't exist.

We just have to wait for the rest of the competition to be in-place after the merger for the prices to get better, right?

Investors.

The cost of doing business is paying investors and skimming as much money from all parts of the business to make sure investors make their money first. Great product? Bad product? No product? it doesn't matter, you just sprinkle magic fairy dust in the wind and the press picks it up and your value goes up (or down) and the investors make money or break even (the real ones rarely actually lose money).

Investors.

DrZEUS
join:2004-01-13
Mississauga, ON

DrZEUS to Great Indeed

Member

to Great Indeed
I highly doubt any company will consider losing 1 Billion dollars as ther cost of doing business....they will find a way to recoup that by either raising prices/fees, or some other scam.

cpsycho
join:2008-06-03
Treadeu Land

cpsycho to gigahurtz

Member

to gigahurtz
Not just the fees for the tracking of the information. But a rate increase to cover the cost of the lawsuit and the fine they have to pay.
hottboiinnc4
ME
join:2003-10-15
Cleveland, OH

hottboiinnc4

Member

DSLX

should be next. They do the same thing on DSL- when it is NOT a taxed service.

NetFixer
From My Cold Dead Hands
Premium Member
join:2004-06-24
The Boro
Netgear CM500
Pace 5268AC
TRENDnet TEW-829DRU

NetFixer

Premium Member

Nothing new

This is not new. Several years ago they got caught doing the same thing with DSL service. At that time as I recall, AT&T had to repay the overcharged customers themselves, and there actually was a small refund to anyone who filled out an application to receive it (payment was not automatic, and if you did not know that you had to fill out an application form to get the refund, too bad).

This time it appears that it is actually the state and local governments who will be required to repay the illegal taxes that were collected, and AT&T is just going to be the bill collector. Good luck with AT&T or anybody getting money back from budget strained state or local governments. AT&T will now have the expense of trying to collect that money (and will certainly pass that expense on to their customers), but I think it is unlikely that even a small percentage of the bogus tax money will actually be recovered and redistributed.

Snowy
Lock him up!!!
Premium Member
join:2003-04-05
Kailua, HI

Snowy

Premium Member

Re: Nothing new

said by NetFixer:

This time it appears that it is actually the state and local governments who will be required to repay the illegal taxes that were collected, and AT&T is just going to be the bill collector. Good luck with AT&T or anybody getting money back from budget strained state or local governments.

You'd think offsets would be the easiest way of dealing with that but considering that would efficient, it won't happen that way.

spewak
R.I.P Dadkins
Premium Member
join:2001-08-07
Elk Grove, CA

spewak

Premium Member

Take it ATT

Don't just look at it, EAT IT ATT!
MrHappy316
Wish I had my tank
Premium Member
join:2003-01-02
Columbia, SC

MrHappy316

Premium Member

911 Fee

Now they can work on the bs 911 fee that is collected on data card plans. Since I cannot make a phone call on my data card I cannot see how this fee is even legal. It's akin to charging a dry loop DSL customer the fee.
hottboiinnc4
ME
join:2003-10-15
Cleveland, OH

hottboiinnc4

Member

Re: 911 Fee

because your data card is actually issued a phone number in the system to keep track of it. That's why the 911 charge. as far as the dry loop fee- lets talk about DSLX and their tax on DSL customers. almost $3 per customer per month. Talk about pure profit.
CharlesH1
join:2011-04-29
Milpitas, CA

CharlesH1

Member

Re: 911 Fee

said by hottboiinnc4:

because your data card is actually issued a phone number in the system to keep track of it. That's why the 911 charge.

Curious that Verizon Wireless does not charge any of this on their data cards. Under additional charges, I only have a $0.06 "Administrative" Fee on my data card. No taxes or anything else.

dvd536
as Mr. Pink as they come
Premium Member
join:2001-04-27
Phoenix, AZ

dvd536 to MrHappy316

Premium Member

to MrHappy316
said by MrHappy316:

Now they can work on the bs 911 fee that is collected on data card plans. Since I cannot make a phone call on my data card I cannot see how this fee is even legal. It's akin to charging a dry loop DSL customer the fee.

voip, magicjack

Cheese
Premium Member
join:2003-10-26
Naples, FL

Cheese

Premium Member

Speaking of ATT

I saw a commercial the other night, saying they were teaming up with T-Mobile, isn't it a bit premature to be creating these commercials? I supposed ATT thinks this will just be approved with no thought about it? I mean seriously?

Modus
I hate smartassery on forums
Premium Member
join:2005-05-02
us

Modus

Premium Member

Re: Speaking of ATT

So you think it wont? Really think about it they ate up all the other companies....

Cheese
Premium Member
join:2003-10-26
Naples, FL

Cheese

Premium Member

Re: Speaking of ATT

At this point, I can't say for sure, but I still think it's premature to start running commercials about it...

Modus
I hate smartassery on forums
Premium Member
join:2005-05-02
us

Modus

Premium Member

Re: Speaking of ATT

i agree but that shows you they know what most dont and dont want to believe

bobjohnson
Premium Member
join:2007-02-03
Spartanburg, SC

bobjohnson to Cheese

Premium Member

to Cheese
said by Cheese:

I saw a commercial the other night, saying they were teaming up with T-Mobile, isn't it a bit premature to be creating these commercials? I supposed ATT thinks this will just be approved with no thought about it? I mean seriously?

The commercial says att is planning to team up with tmo to bring you a better network etc not that they are.

ZeddicusToo
@verizon.net

ZeddicusToo

Anon

Barring class action in fine print

is also illegal.

icp1
Premium Member
join:2000-10-13
Saint Louis, MO

icp1

Premium Member

Re: Barring class action in fine print

said by ZeddicusToo :

is also illegal.

not according to the supreme court, didnt you read?

ZeddicusToo
@verizon.net

ZeddicusToo

Anon

Re: Barring class action in fine print

No, not for some months now.

Well, I knew Congress was bought and paid for, but I didn't know SCOTUS was, too. I guess the justices don't even trust judges now either (not that I can blame them for that).

Suntop
Wolfrider Elf
Premium Member
join:2000-03-23
Fairfield, MT
·3Rivers Communic..
·T-Mobile
Netgear R6400
Netgear WNR1000
Netgear WNDR3400

Suntop

Premium Member

Is Ma Bell (Or Ma Cell) coming back?

It may be illegal, but they do it every time. AT&T been doing this for years and they are trying to create "MA BELL" with cell company buying they been doing with the ill gotten taxes. We (the consumer) will never see a dime and if we do others will have to pay it back. It is not good business to steal tax money. The thing is, like banks, AT&T is "to big to fail" with T-Mobile there will be the big 3 Verizon, Sprint, and AT&T. As AT&T recently acquired Alltel that leaves Sprint, and Verizon as major networks. Now what will everyone do when MA BELL takes over the Cellphones (like they did with the telephone untill the mid 80s). And with the recent Supreme Court ruling, they will continue to bleed the consumers dry until they cannot pay then they can proceed to screw up your credit. Oh and good luck on getting it off... they are fast to put it on but slow to remove it. Once AT&T buys my cell company I will in turn switch.
Nailgunner
join:2010-09-28

Nailgunner

Member

Missing the finer point people

AT&T, is claiming, believe them or not, that they passed the collected taxes on to various state and local entities. They didn't keep the money, as no company would. They are going to have to get the money back from these governments, and then distribute it. Other than the administrative costs, this costs AT&T nothing. The states/cities/counties are going to have to fork over the billion.

morbo
Complete Your Transaction
join:2002-01-22
00000

morbo

Member

Re: Missing the finer point people

said by Nailgunner:

The states/cities/counties are going to have to fork over the billion.

Provided AT&T shows documentation of what was collected and what was sent to states/cities/counties. That would mean opening their books.
Nailgunner
join:2010-09-28

Nailgunner

Member

Re: Missing the finer point people

said by morbo:

said by Nailgunner:

The states/cities/counties are going to have to fork over the billion.

Provided AT&T shows documentation of what was collected and what was sent to states/cities/counties. That would mean opening their books.

Amended returns are filed all the time by corporations. They would have to provide documentation to the states/cities/counties, sure, but those books are already open to them for audits anyway. Nothing new there. And if some attorney has already added it all up, month by month, taxing authority by taxing authority, the documentation part has pretty much already been done for them. File the amended return, attach the appropriate part of the court order applicable to them and they would be obligated to refund the money.

They could have an issue with various statute of limitations on filing amended returns depending on how far back this issue goes. And I certainly wouldn't want to be the poor sap in the tax department at AT&T who has this dumped on his desk in the morning.