IRS News: How Proposed Excise Tax on Foreign Call Centers Will Affect Your Business

Does your company use a call center to handle customer or technical service calls? Is your contracted call center located outside of the United States? If so, you should pay close attention proposed legislation by United State Senator Charles E. Schumer. According to the recent bill proposal, a $0.25 per-call excise tax will be imposed on companies who transfer domestic customer service calls to call centers outside of the United States.

US companies need to be prepared to pay the new tax if/when the legislation passes. Businesses are the largest source of uncollected taxes and with the recent economic crisis, tax authorities at both the federal and states levels are pouring more money and personnel into cracking down on businesses – large and small – to cut into their growing budget deficits. In fact, 25% to 30% of my tax relief clients are small businesses with tax problems.

Schumer’s legislation would require companies to disclose with their callers what country their call is transferred outside of the US, as well as track and report their use of foreign call centers quarterly and annually. The Federal Trade Commission (FTC) is getting involved as well: companies will be required to annually report to the FTC that they are complying with this legislation, and failure to comply would result in civil penalties.

Companies tend to contract overseas call centers (most commonly in Canada, India, Indonesia, Ireland, the Phillipines and South Africa) because of the high-volume of English-speaking people who are willing to work for low wages. This proposed bill will encourage companies to keep their call centers in our country, therefore providing people with jobs.

Because new tax laws like Schumer’s are being added frequently, it is important for anyone planning to start and/or grow their business to know how to avoid tax trouble by staying up to date with new tax laws and understanding the implications for their company. However, if you do find yourself in trouble with the IRS, the most important advice is to not take any chances when dealing with the IRS. Hiring an expert tax attorney or Certified Tax Resolution Specialist can make all the difference when it comes to vigorously and objectively defending your rights and negotiating a settlement that will help protect you and the future of your business.

This year, we expect IRS audits for small business owners to increase, so it’s important to get IRS tax help now to resolve your tax troubles. For more information on achieving tax relief for your business or individual IRS problems, visit www.taxresolution.com for a free tax relief consultation or call 866-IRS-PROBLEMS.

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