Internal Revenue Code:Sec. 4253. Exemptions

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Location in Internal Revenue Code

     TITLE 26 - INTERNAL REVENUE CODE
      Subtitle D - Miscellaneous Excise Taxes
       CHAPTER 33 - FACILITIES AND SERVICES
        Subchapter B - Communications
      

Statute

    Sec. 4253. Exemptions
 
    (a) Certain coin-operated service
      Service paid for by inserting coins in coin-operated telephones
    available to the public shall not be subject to the tax imposed by
    section 4251 with respect to local telephone service, or with
    respect to toll telephone service if the charge for such toll
    telephone service is less than 25 cents; except that where such
    coin-operated telephone service is furnished for a guaranteed
    amount, the amounts paid under such guarantee plus any fixed
    monthly or other periodic charge shall be subject to the tax.
    (b) News services
      No tax shall be imposed under section 4251, except with respect
    to local telephone service, on any payment received from any person
    for services used in the collection of news for the public press,
    or a news ticker service furnishing a general news service similar
    to that of the public press, or radio broadcasting, or in the
    dissemination of news through the public press, or a news ticker
    service furnishing a general news service similar to that of the
    public press, or by means of radio broadcasting, if the charge for
    such service is billed in writing to such person.
    (c) International, etc., organizations
      No tax shall be imposed under section 4251 on any payment
    received for services furnished to an international organization,
    or to the American National Red Cross.
    (d) Servicemen in combat zone
      No tax shall be imposed under section 4251 on any payment
    received for any toll telephone service which originates within a
    combat zone, as defined in section 112, from a member of the Armed
    Forces of the United States performing service in such combat zone,
    as determined under such section, provided a certificate, setting
    forth such facts as the Secretary may by regulations prescribe, is
    furnished to the person receiving such payment.
    (e) Items otherwise taxed
      Only one payment of tax under section 4251 shall be required with
    respect to the tax on any service, notwithstanding the lines or
    stations of one or more persons are used in furnishing such
    service.
    (f) Common carriers and communications companies
      No tax shall be imposed under section 4251 on the amount paid for
    any toll telephone service described in section 4252(b)(2) to the
    extent that the amount so paid is for use by a common carrier,
    telephone or telegraph company, or radio broadcasting station or
    network in the conduct of its business as such.
    (g) Installation charges
      No tax shall be imposed under section 4251 on so much of any
    amount paid for the installation of any instrument, wire, pole,
    switchboard, apparatus, or equipment as is properly attributable to
    such installation.
    (h) Nonprofit hospitals
      No tax shall be imposed under section 4251 on any amount paid by
    a nonprofit hospital for services furnished to such organization.
    For purposes of this subsection, the term ''nonprofit hospital''
    means a hospital referred to in section 170(b)(1)(A)(iii) which is
    exempt from income tax under section 501(a).
    (i) State and local governmental exemption
      Under regulations prescribed by the Secretary, no tax shall be
    imposed under section 4251 upon any payment received for services
    or facilities furnished to the government of any State, or any
    political subdivision thereof, or the District of Columbia.
    (j) Exception for nonprofit educational organizations
      Under regulations prescribed by the Secretary, no tax shall be
    imposed under section 4251 on any amount paid by a nonprofit
    educational organization for services or facilities furnished to
    such organization.  For purposes of this subsection, the term
    ''nonprofit educational organization'' means an educational
    organization described in section 170(b)(1)(A)(ii) which is exempt
    from income tax under section 501(a). The term also includes a
    school operated as an activity of an organization described in
    section 501(c)(3) which is exempt from income tax under section
    501(a), if such school normally maintains a regular faculty and
    curriculum and normally has a regularly enrolled body of pupils or
    students in attendance at the place where its educational
    activities are regularly carried on.
    (k) <<NOTE: Regulations.>> Exemption for Qualified Blood Collector 
      Organizations.--Under regulations provided by the Secretary, no tax 
    shall be imposed under section 4251 on any amount paid by a qualified 
    blood collector organization (as defined in section 7701(a)(49)) for 
    services or facilities furnished to such organization.
    (l) Filing of exemption certificates
      (1) In general
        In order to claim an exemption under subsection (c), (h), (i),
      (j), or (k) a person shall provide to the provider of communications
      services a statement (in such form and manner as the Secretary
      may provide) certifying that such person is entitled to such
      exemption.
      (2) Duration of certificate
        Any statement provided under paragraph (1) shall remain in
      effect until -
          (A) the provider of communications services has actual
        knowledge that the information provided in such statement is
        false, or
          (B) such provider is notified by the Secretary that the
        provider of the statement is no longer entitled to an exemption
        described in paragraph (1).
      If any information provided in such statement is no longer
      accurate, the person providing such statement shall inform the
      provider of communications services within 30 days of any change
      of information.
 

Sources

    (Aug. 16, 1954, ch. 736, 68A Stat. 504; Pub. L. 85-859, title I,
    Sec. 133(a), Sept. 2, 1958, 72 Stat. 1290; Pub. L. 86-344, Sec.
    4(a), Sept. 21, 1959, 73 Stat. 619; Pub. L. 87-508, Sec. 4(b), June
    28, 1962, 76 Stat. 115; Pub. L. 89-44, title III, Sec. 302, June
    21, 1965, 79 Stat. 146; Pub. L. 89-368, title II, Sec. 202(b), Mar.
    15, 1966, 80 Stat. 66; Pub. L. 91-172, title I, Sec. 101(j)(27),
    Dec. 30, 1969, 83 Stat. 529; Pub. L. 94-455, title XIX, Sec.
    1904(a)(6), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1811, 1834; Pub.
    L. 101-508, title XI, Sec. 11217(c)(1), Nov. 5, 1990, 104 Stat.
    1388-438.)
 

Amendment of Section

                                   REPEAL
        This subchapter, relating to the tax on communications, was
      repealed by Pub. L. 90-364, title I, Sec. 105(b)(3), June 28,
      1968, 82 Stat. 266, as amended by Pub. L. 91-172, title VII, Sec.
      702(b)(3), Dec. 30, 1969, 83 Stat. 660; Pub. L. 91-614, title II,
      Sec. 201(b)(3), Dec. 31, 1970, 84 Stat. 1843, effective with
      respect to amounts paid pursuant to bills first rendered on or
      after Jan. 1, 1982. In the case of communications services
      rendered before Nov. 1, 1981, for which a bill has not been
      rendered before Jan. 1, 1982, a bill shall be treated as having
      been first rendered on Dec. 31, 1981. Repeal of this subchapter
      was not executed in view of the amendments to section 4251 of
      this title by Pub. L. 96-499, Pub. L. 97-34, Pub. L. 97-248, Pub.
      L. 98-369, Pub. L. 99-514, Pub. L. 100-203, and Pub. L. 101-508,
      extending the date in (and finally eliminating) provisions which
      had reduced the tax to zero after a specified date.
 

Miscellaneous

                                 AMENDMENTS

2006 - Pension Protection Act of 2006 (P.L. 109-280)
Section 1207(c) Exemption From Communication Excise Tax.--
            (1) In general.--Section 4253 (relating to exemptions) is 
        amended by redesignating subsection (k) as subsection (l) and 
        inserting after subsection (j) the following new subsection:
    ``(k) <<NOTE: Regulations.>> Exemption for Qualified Blood Collector 
Organizations.--Under regulations provided by the Secretary, no tax 
shall be imposed under section 4251 on any amount paid by a qualified 
blood collector organization (as defined in section 7701(a)(49)) for 
services or facilities furnished to such organization.''.
            (2) Conforming amendment.--Section 4253(l), as redesignated 
        by paragraph (1), is amended by striking ``or (j)'' and 
        inserting ``(j), or (k)''.

      1990 - Subsec. (k). Pub. L. 101-508 added subsec. (k).
      1976 - Subsec. (d). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck
    out ''or his delegate'' after ''Secretary''.
      Subsecs. (i), (j). Pub. L. 94-455, Sec. 1904(a)(6), added
    subsecs. (i) and (j).
      1969 - Subsec. (h). Pub. L. 91-172 substituted ''section
    170(b)(1)(A)(iii)'' for ''section 503(b)(5)''.
      1966 - Subsec. (h). Pub. L. 89-368 added subsec. (h).
      1965 - Subsec. (a). Pub. L. 89-44 substituted ''with respect to
    local telephone service, or with respect to toll telephone service
    if the charge for such toll telephone service is less than 25
    cents'', for ''with respect to general telephone service, or with
    respect to toll telephone service or telegraph service if the
    charge for such toll telephone service or telegraph service is less
    than 25 cents''.
      Subsec. (b). Pub. L. 89-44 substituted ''local telephone
    service'' for ''general telephone service'' and ''such service''
    for ''such services''.
      Subsec. (c). Pub. L. 89-44 substituted ''International, etc.,
    organizations'' for ''Certain organizations'' in heading.
      Subsec. (d). Pub. L. 89-44 reenacted subsec. (d) without change.
      Subsec. (e). Pub. L. 89-44 substituted ''any service'' for ''toll
    telephone service, telegraph service, or teletypewriter exchange
    service''.
      Subsec. (f). Pub. L. 89-44 substituted amounts paid for any toll
    telephone service for amounts paid for wire mileage service, wire
    and equipment service, and use of any telephone or radiotelephone
    line or channel which constitutes general telephone service if such
    line or channel connects stations between any two of which there
    would otherwise be a toll charge.
      Subsec. (g). Pub. L. 89-44 reenacted subsec. (g) without change.
      Subsecs. (h) to (j). Pub. L. 89-44 struck out subsecs. (h) to
    (j), which related to terminal facilities in case of wire mileage
    service and to certain interior and private communications
    services.
      1962 - Subsec. (j). Pub. L. 87-508 added subsec. (j).
      1959 - Subsec. (f). Pub. L. 86-344 substituted ''Common carriers
    and communications companies'' for ''Special wire service in
    company business'' in heading, incorporated existing provisions in
    opening and closing statements and par. (1) and added par. (2).
      1958 - Subsec. (a). Pub. L. 85-859 substituted ''general
    telephone service, or with respect to toll telephone service or
    telegraph service if the charge for such toll telephone service or
    telegraph service is less than 25 cents'' for ''local telephone
    service''.
      Subsec. (b). Pub. L. 85-859 substituted ''general telephone
    service, on any payment received from any person for services
    used'' for ''local telephone service, upon any payment received
    from any person for services or facilities utilized''.
      Subsec. (c). Pub. L. 85-859 substituted ''on any payment received
    for services furnished to an international organization, or to the
    American National Red Cross'' for ''upon any payment received for
    services or facilities furnished to an international organization,
    or any organization created by act of Congress to act in matters of
    relief under the treaty of Geneva of August 22, 1864''.
      Subsec. (d). Pub. L. 85-859 substituted ''on any payment received
    for any toll telephone service'' for ''with respect to long
    distance telephone service upon any payment received for any
    telephone or radio telephone message''.
      Subsec. (e). Pub. L. 85-859 substituted ''toll telephone service,
    telegraph service, or teletypewriter exchange service'' for ''long
    distance telephone service or telegraph service'' and ''in
    furnishing such service'' for ''in the transmission of such
    dispatch, message or conversation''.
      Subsec. (f). Pub. L. 85-859 substituted ''any wire mileage
    service or wire and equipment service as is used in the conduct''
    for ''the service described in sections 4252(d) and (e) as is
    utilized in the conduct''.
      Subsecs. (g) to (i). Pub. L. 85-859 added subsecs. (g) to (i).
                      EFFECTIVE DATE OF 1990 AMENDMENT
      Section 11217(c)(2) of Pub. L. 101-508 provided that:
      ''(A) In general. - The amendment made by paragraph (1) (amending
    this section) shall apply to any claim for exemption made after the
    date of the enactment of this Act (Nov. 5, 1990).
      ''(B) Duration of existing certificates. - Any annual certificate
    of exemption effective on the date of the enactment of this Act
    (Nov. 5, 1990) shall remain effective until the end of the annual
    period.''
                      EFFECTIVE DATE OF 1976 AMENDMENT
      Amendment by section 1904(a)(6) of Pub. L. 94-455 effective on
    first day of first month which begins more than 90 days after Oct.
    4, 1976, see section 1904(d) of Pub. L. 94-455, set out as a note
    under section 4041 of this title.
                      EFFECTIVE DATE OF 1969 AMENDMENT
      Amendment by Pub. L. 91-172 effective Jan. 1, 1970, see section
    101(k)(1) of Pub. L. 91-172, set out as an Effective Date note
    under section 4940 of this title.
                      EFFECTIVE DATE OF 1966 AMENDMENT
      Amendment by Pub. L. 89-368 applicable to amounts paid pursuant
    to bills first rendered on or after April 1, 1966, for services
    rendered on or after such date and to amounts paid pursuant to
    bills rendered on or after such date for services which were
    rendered before such date and for which no previous bill was
    rendered except with respect to such services as were rendered more
    than two months before such date and, as to services rendered more
    than 2 months before such date, direction that the provisions of
    subchapter B of chapter 33 of the Code in effect at the time such
    services were rendered, be applied, subject to the provision of
    section 701(b)(2) of the Excise Tax Reduction Act of 1965.
                      EFFECTIVE DATE OF 1965 AMENDMENT
      Amendment by Pub. L. 89-44 applicable to amounts paid pursuant to
    bills rendered on or after January 1, 1966, for services rendered
    on or after such date, but, in the case of amounts paid pursuant to
    bills rendered after January 1, 1966, for services rendered before
    such date for which no previous bill had been rendered, applicable
    except with respect to such services as were rendered more than two
    months before such date, see section 701(b)(2)(A) of Pub. L. 89-44,
    set out as a note under section 4251 of this title.
                      EFFECTIVE DATE OF 1962 AMENDMENT
      Amendment by Pub. L. 87-508 applicable with respect to services
    furnished on or after Jan. 1, 1963, see section 4(c) of Pub. L.
    87-508, set out as a note under section 4252 of this title.
                      EFFECTIVE DATE OF 1959 AMENDMENT
      Section 4(b) of Pub. L. 86-344, as amended by Pub. L. 99-514,
    Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
      ''(1) Subject to the provisions of paragraph (2), the amendment
    made by subsection (a) (amending this section) shall apply with
    respect to amounts paid on or after January 1, 1959, for services
    rendered on or after such date.
      ''(2) The amendment made by subsection (a) (amending this
    section) shall not apply with respect to amounts paid pursuant to
    bills rendered before January 1, 1959. In the case of amounts paid
    pursuant to bills rendered on or after such date for services for
    which no bill was rendered before such date, such amendment shall
    apply except with respect to such services as were rendered more
    than 2 months before such date.  In the case of services rendered
    more than 2 months before such date, the provisions of subchapter B
    of chapter 33 of the Internal Revenue Code of 1986 (formerly I.R.C.
    1954) in effect at the time such services were rendered shall apply
    to the amounts paid for such services.''
                      EFFECTIVE DATE OF 1958 AMENDMENT
      For effective date of amendment made by Pub. L. 85-859, see
    section 133(b) of Pub. L. 85-859, set out as a note under section
    4251 of this title.