Sales Tax Refunds for Providers of Cable Television, Internet Access or Telecommunications Services

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Requesting a Refund for Tax Paid Jan. 1 – Dec. 31, 2023

April 1, 2024, is the deadline to submit a refund request for tax paid in 2023 on qualifying purchases.

Streamlined Process for Related Entities

Related entities that are also providers of cable television, internet access or telecommunications services may request one refund on behalf of all related companies. The related companies should choose one entity to submit the refund request and supporting documentation on behalf of all related companies. Taxpayers filing a combined claim for refund must include a completed Form 00-985, Assignment of Right to Refund (PDF) for each qualifying related entity. Assignment of Right to Refund forms should be emailed to citrus.help@cpa.texas.gov at the time the claim of refund is filed.

Overview

Providers of cable television, internet access or telecommunications services can claim a refund of the 6.25 percent Texas state sales and use tax paid on qualifying purchases.

A "qualifying purchase" is tangible personal property:

purchased, leased or rented by a provider or its subsidiary;
directly used or consumed by the provider or subsidiary in or during these activities:
- the distribution of cable television service;
- the provision of internet access service; or
- the transmission, conveyance, routing or reception of telecommunications services; and
on which the provider or its subsidiary paid Texas state sales and use tax in the calendar year immediately preceding the calendar year in which the request for refund is submitted.

The refund does not apply to the following:

local sales and use tax; or
sales and use tax paid on property directly used or consumed in or during the provision, creation or production of data processing or information services, except for equipment used to provide such services as part of a single charge for internet access service as set out in Rule 3.366.

In 2015 and thereafter, providers and their subsidiaries can submit refund requests annually for Texas state sales and use tax paid on qualifying purchases during the entire preceding calendar year.

A provider or its subsidiary claiming the sales and use tax refund under this program cannot claim special property tax benefits for economic development under Tax Code Chapter 313, Subchapter B on that same tangible personal property.

This program's total available refund amount is capped at $50 million each calendar year. If the total of all qualifying refund requests received for a calendar year exceeds this cap, each provider or subsidiary submitting an eligible refund request will receive a pro rata share.

The Refund Request Process

Who Can Apply for the Refund?

Providers of cable television, internet access or telecommunications services can request a refund of Texas state sales and use tax paid on qualifying purchases. Subsidiaries of a provider can also request a refund but must identify the associated provider on the refund request. The terms "parent" and "subsidiary" are defined in Texas Business Organizations Code, Sections 1.002(85) and 1.002(65), respectively.

How to Apply for the Refund

Providers and subsidiaries requesting a refund must submit all required information to the Comptroller. Providers and subsidiaries should submit only one claim per applicable refund period that covers all Texas state sales and use tax paid on qualifying purchases during the refund period. The Comptroller can request additional documentation during the verification process and will deny refunds if all required documentation is not provided.

Submissions by third parties must include a Power of Attorney. These should be emailed to citrus.help@cpa.texas.gov. The subject line of the email should reference the taxpayer name and taxpayer number who is submitting the refund claim.

Filing by the Refund Request Date

Electronic Claim Submission

Providers and subsidiaries should file refund claims electronically, using our online system.

Requests must be in comma-delimited (CSV) format. Use the exact fields in the exact order shown in the example. Refer to the requirements in the table Data Required to Request a Refund. Do not include any blank lines, totals or subtotals. After entering all data, delete the header row, and save the file to your computer as a CSV file. Include each transaction for which you are requesting a refund in a single file. Taxpayers can only have one active submission on file at a time. Subsequent uploads will overwrite previous uploads.
The total Amount Subject to Tax on Qualifying Purchases entered on the Refund Summary page will not be adjusted if it does not match the detailed transactions file received. The taxpayer requesting the refund must submit changes to the Total Amount Subject to Tax on Qualifying Purchases by the refund request date.
The total Amount of State Tax Refund Requested on the Refund Summary page will not be adjusted if it does not match the detail transactions file received. The taxpayer requesting the refund must submit changes to the Total Sales Tax Refund Amount Requested by the refund request date.
Upload your full detailed transactions file as early as possible to avoid peak website traffic, which may prevent the upload of your file.

Example
Vendor Name	Taxpayer Number Who Paid Tax to State	How Paid	Invoice Number	Invoice Date	Item Description	Payment Date	Amount Subject to Tax	Amount of State Tax Refund Requested
Willow Equipment Company	12300000168	Assessed	0013135-001	09/01/2013	Router	09/01/2013	40.000.00	2,500.00
Willow Equipment Company	12300000168	Accrued	1452	10/17/2013	Servers	10/17/2013	10,286.00	642.88
L & L Supply	12300000093	Paid to Vendor	INV100-154168	11/14/2013	Wiring	11/14/2013	971.58	60.72
L & L Supply	12300000093	Refunded	INV100-154168	11/14/2013	Wiring	11/14/2013	-971.58	-60.72

Data Required to Request a Refund
Field	Format	Character Limit	Instructions
Vendor Name	text	50	Input vendor (seller) name from the invoice.
Taxpayer Number Who Paid Tax to State	number	11	Enter the 11-digit Texas sales and use tax number under which the tax for this transaction was reported. If tax was paid/refunded by a vendor, enter the vendor's sales and use tax number. If tax was accrued and remitted on your return(s) or assessed by the Comptroller, enter your sales and use tax number
How Paid	text	15	Describe how the tax was paid. Enter "assessed" if the tax was assessed by the Comptroller. Enter "accrued" if the tax was accrued and remitted on your sales tax return. Enter "paid to vendor" if the tax was invoiced by and paid to a vendor (seller). Enter "refunded" if the tax has been refunded/credited to you.
Invoice Number	text	30	Enter the invoice number exactly as it appears on the invoice.
Invoice Date	date	mm/dd/yy	Enter the invoice date in mm/dd/yyyy format.
Item Description	text	100	Provide a detailed description of the items(s) purchased and/or a manufacturer part number. Do not list inventory codes. The Comptroller may request additional information.
Payment Date	date	mm/dd/yy	Enter the date the tax was paid in mm/dd/yyyy format. This date must be during a valid period for this refund request.
Amount Subject to Tax	number	12	Enter the total dollar amount on which sales or use tax was calculated for qualifying items on this invoice.
Amount of State Tax Refund Requested	number	10	Enter the amount of state tax (6.25%) paid on qualifying items on this invoice.

Paper Claim Submission

Providers and subsidiaries can request a waiver from electronic filing if they cannot file electronically. Waiver requests must be submitted at least 30 days before the refund claim deadline and must include a detailed written explanation of the provider's inability to file electronically. Send a request for a waiver from electronic filing to the Comptroller of Public Accounts, P.O. Box 13003, Austin, TX 78711.

Filing after the Refund Request Date

Email requests filed after the refund request date to citrus.help@cpa.texas.gov. Include the following information in the body of the email:

Texas taxpayer number
taxpayer name
refund request year (e.g., for qualifying purchases on which tax was paid Jan. 1, 2015, through Dec. 31, 2015, the refund request year is 2015)
claim type: provider or subsidiary
provider Texas taxpayer number (if claim is being filed by subsidiary)
provider taxpayer name (if claim is being filed by subsidiary)
industry type: telecommunications, cable or internet
total taxable amount of qualifying purchases (dollars and cents)
total sales tax refund amount requested (dollars and cents)
contact name
contact title (e.g., employee, accountant, etc.)
contact company name
contact phone number
contact email
contact address

A CSV file containing the information described in the Data Required to Request Refund table must be submitted upon request. See the Electronic Claim Submission section for an example of an approved CSV file and additional information regarding the file.

Refund Request Date

To be considered timely, a claim for refund of Texas state sales and use tax must be filed by the refund request date. The refund request date is March 31 of the year immediately following the calendar year in which the tax was paid. If the refund request date falls on a Saturday, Sunday or legal holiday, the refund request date will be the next business day.

The Comptroller will deny late-filed claims for lack of funds if the total amount of eligible requests for the applicable refund period received by the refund request date is greater than $50 million. If the total amount of eligible requests received by the refund request date for the applicable refund period is less than or equal to $50 million, we will process late-filed requests on a first-come, first-served basis.

Verification

The Comptroller's Audit Division verifies refund claims. A refund claim will be denied if the Comptroller determines that the taxpayer requesting a refund was not a provider of a qualifying service, or a subsidiary of a qualifying provider, during the calendar year on which the claim is based.

Additionally, the refund amount will be reduced if the Comptroller determines that the request includes items:

that are not qualifying purchases,
on which no Texas sales or use tax was paid,
without required or supporting documentation, or
for which additional information requested by the Comptroller was not provided within 30 days.

How the Refund is Calculated

The amount of refund available to each provider or subsidiary for a calendar year depends on whether the $50 million cap is met.

$50 million or less claimed: If the total amount of Texas state sales and use tax claimed on qualifying purchases by all providers and subsidiaries that are eligible for a refund is less than or equal to $50 million for the calendar year, the Comptroller will refund the full amount of Texas state sales and use tax paid on qualifying purchases, as claimed by each provider and subsidiary and verified by the Comptroller.

For initial refund payments, each provider and subsidiary will be entitled to a pro rata percentage of the amount requested by the provider or subsidiary and verified by the Comptroller. The pro rata percentage will be determined by comparing the $50 million available for refund to the total amount of all claims submitted for refund.

Notifications and Refund Payments

The Comptroller's Audit Division will provide refund verification results to providers and subsidiaries that have submitted a claim. If additional information is required to process the claim, the Comptroller will send a written request for more information to the provider or subsidiary, who must provide the information to the Comptroller within 30 calendar days.

If the Comptroller denies a claim, in whole or in part, the provider or subsidiary who submitted that claim will receive a written notice that explains the reason(s) for denial and identifies the amount approved for refund, if any. Providers or subsidiaries who receive a denial notification can appeal the denial by timely requesting a hearing.

$50 million or less claimed: If the total amount of Texas state sales and use tax claimed on qualifying purchases by all providers and subsidiaries that are eligible for a refund is not more than $50 million for the calendar year, the Comptroller will issue refund payments equal to the amount of each approved refund claim by Aug. 31 of the year that follows the calendar year in which the tax was paid.

More than $50 million claimed: If the total amount of Texas state sales and use tax claimed on qualifying purchases by all providers and subsidiaries that are eligible for a refund is more than $50 million for the calendar year, the Comptroller will issue prorated initial refund payments by Aug. 31 of the year that follows the calendar year in which the tax was paid. The Comptroller will issue any additional refund payments at the conclusion of all appeals through the administrative hearings process and state courts.

Hearing Requests

Most providers or subsidiaries who receive a denial can request a hearing. To request a hearing, submit a letter with a statement of grounds within 60 days from the date printed on the denial notice. The postmark date, or its equivalent, on a request for hearing will constitute the filing date. The Comptroller will only consider hearing requests that are filed timely. See Rule 1.5.

Providers or subsidiaries whose late-filed requests are denied for lack of funds are not eligible to request a hearing.

Additional Refund Payments

If the total amount of Texas state sales and use tax claimed on qualifying purchases for a calendar year by all providers and subsidiaries that were eligible for a refund exceeds $50 million, the Comptroller will recalculate the total approved refund amount and each provider and subsidiary's pro rata percentage of that amount when all administrative and state appeals conclude. The Comptroller will issue an additional, final refund payment for that calendar year to eligible providers or subsidiaries.

If the approved refund claims exceed the $50 million cap for a calendar year, the Comptroller will pay the entire $50 million allocated for the refund program for that calendar year to qualifying providers or subsidiaries. The state will not retain any remaining funds resulting from claims denials.

Need Help?

For help requesting a refund through our online system, contact us at citrus.help@cpa.texas.gov or 1-844-519-5671.