[Code of Federal Regulations]
[Title 26, Volume 16]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR49.4253-10]

[Page 249]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 49_FACILITIES AND SERVICES EXCISE TAXES--Table of Contents
 
                        Subpart C_Communications
 
Sec. 49.4253-10  Exemption for certain private communications services.

    (a) In general. The tax imposed by section 4251 on amounts paid for 
general telephone service does not apply to amounts paid for any such 
service furnished on or after January 1, 1963, to the extent that the 
amounts paid are for use of any telephone or radio telephone line or 
channel (including equipment, instruments, and other apparatus furnished 
exclusively for use in connection with the line or channel) in the 
conduct of a trade or business when such line or channel is furnished 
between specified locations in different States or between specified 
locations in different counties, municipalities, or similar political 
subdivisions of a State. The term ``trade or business'' as used in this 
section includes activities of organizations which are conducted with no 
purpose of gain or profit. A line or channel is considered to be 
furnished between specified locations only when the line or channel 
connects preselected points without the use of switching functions 
performed by a communications company exchange. Where an amount is paid 
which includes a charge for such a line or channel and also a charge for 
the service provided by means of switching functions performed by a 
communications company exchange, the exemption is applicable only to 
that portion of the amount so paid as is attributable to such a line or 
channel. The preselected points must be located in different States or 
in different counties or municipalities of the same State. If the 
preselected points are located in a State in which the political 
subdivisions are not denominated as counties or municipalities, then the 
preselected points must be in different political subdivisions of such 
State which correspond to counties or municipalities. For purposes of 
this paragraph the term ``municipality'' means the largest political 
subdivision of a State below the level of county or similar subdivision. 
For the exemption to apply, the charge for the service must be billed in 
writing to the person paying for the service and such person must 
certify in writing that the service is for use in the conduct of a trade 
or business.
    (b) Exemption inapplicable. This particular exemption is not 
applicable in the case of taxes imposed on amounts paid for other 
services by section 4251, even though such services are utilized in the 
conduct of a trade or business.

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