What’s New in 2014

Prepaid wireless phones and calling cards.

Starting Jan. 1, 2014, the Department of Revenue will administer the E911 fee and TAM fee that are collected by prepaid wireless providers.

Note: It is the responsibility of retailers to monitor the department’s website for notice of fee changes.

Prepaid wireless E911 and Telecommunications Access Minnesota (TAM) fees must be reported and paid to the Minnesota Department of Revenue starting Jan. 1, 2014. These fees apply to prepaid wireless phones or calling cards that:

  • are sold in set units or dollar amounts which decline by a set amount as calls are made; or
  • provide unlimited use for a set time period.

Revenue from the fees is used as follows:

  • E911 – For improvements to “enhanced 911” services that let wireless callers use the 911 emergency calling system.
  • TAM – For relay centers and equipment that help people with hearing or speech disabilities communicate by phone.

The fees are similar to 911 and TAM fees on monthly landline or wireless bills.

Collecting the Fees

The E911 fee is 78 cents and the TAM fee is 6 cents—or 84 cents in all. The fees apply to each retail sale of an item that is subject to them. The fees are the same regardless of the amount of time purchased.

For example, if a customer buys 10 prepaid cards, the fees apply to each card purchased. (That is, 10 x 84 cents = $8.40.)

The fees must be combined into one amount and listed separate from other charges on the invoice or receipt.

Individuals, institutions, businesses, non-profitorganizations, local government agencies, and the state of Minnesota must pay the fees. Federal government agencies are exempt from the fees.

Items Subject to the Fees

Retailers must collect the prepaid wireless E911 and TAM fees when selling:

  • Phones or calling cards preloaded with a set dollar amount for minutes or units of air time
  • Additional minutes or units of air time to refill a prepaid wireless phone or reusable calling card.

Note: State and local sales taxes still apply to prepaid phones and cards, in addition to E911 and TAM fees.

Fee Exemptions

The E911 and TAM fees are not due if you charge one price for a wireless device (i.e., a phone) with a small amount of prepaid service. A “small amount” is up to 10 minutes or $5 worth of airtime.

Fee Changes

The fee amounts may change. If they do, we will list the new amounts on our website at least 30 days before the changes take effect.

Note: It is the responsibility of retailers to monitor the department’s website for notice of fee changes.

Reporting the Fees

Report these fees on the “Prepaid Wireless E911/TAM Fee” line of your Minnesota sales and use tax return.

  • Manually calculate the amount due and enter it in the “Amount” field.
  • The first time you report the fees, you will need to add the line for these fees to your return. If you file online, you can add the line when filing; if you file by phone, you must call our office.

The department can audit your return for E911 and TAM fees, just as we do for other taxes and fees. We can also assess penalties and interest if you are not collecting and sending the fees to us, as required by law.

Seller’s Fee Retention

If you sell prepaid wireless phones or calling cards, you can deduct 3 percent of the E911 and TAM fees you collect and keep this amount as a seller’s fee.


Click here for more Minnesota Sales Tax Guides.

This fact sheet is intended to help you become more familiar with Minnesota tax laws and your rights and responsibilities under the laws. Nothing in this fact sheet supersedes, alters, or otherwise changes any provisions of the tax law, administrative rules, court decisions, or revenue notices.

The content of this and any related posts has been copied or adopted from the Minnesota Department of Revenue Sales Tax Fact Sheet #179.