Kerry Pushes to End Cell Phone Tax
Press Release
Kerry Pushes to End Cell Phone Tax
Senator John Kerry (D-Mass.), a senior member of the Finance Committee, today renewed his call to end an antiquated cell phone tax. The obsolete law, which requires employers to constantly maintain detailed logs of all employee calls, text messages, and emails, is today widely ignored because it was written in 1989 before cheap cell phone plans, blackberrys, and the demand for instant communication saturated the market.
Senators Kerry and John Ensign (R-Nev.) introduced legislation last year to end this practice. Senator Kerry's comments today follow statements from both Treasury Secretary Timothy Geithner and Internal Revenue Service (IRS) Commissioner Doug Shulman calling on Congress to bring the tax treatment of cell phones to the modern age.
"Ten years is a lifetime in terms of the history of cell phone use," said Sen. Kerry. "We need to modernize the laws to reflect the reality that cell phones, Blackberrys and text messaging are an everyday extension of the workplace and are here to stay. Secretary Geithner and the IRS both indicated this afternoon that they wholeheartedly agree. Cell phones are no longer executive perks or luxury items, and it's time for Congress to kick this obsolete law off the books."
In February 2008, Kerry and Ensign introduced the "MOBILE Cell Phone Act" (S. 144) to updated the tax code for employer issued cell phones. This legislation would strike cell phones and similar devices from the category of "listed property" within tax code Section 280F(d)(4). The reform would update the Internal Revenue Code to recognize the growth of business-use mobile communications devices and eliminate paperwork required for businesses to claim a deduction. The current law, passed by Congress in 1989, added cell phones to the definition of listed property under section 280F(d)(4) of the Internal Revenue Code of 1986.
Treating cell phones as listed property requires substantial documentation in order for cell phones to benefit from accelerated depreciation and not be treated as taxable income to the employee. A companion bill was introduced in the House, (H.R. 5450), by Reps. Sam Johnson (R-Texas) and Earl Pomeroy (D-N.D.)
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