---
kind: "range"
citation: "4 U.S.C. §§ 116–126"
title: "4"
from: "116"
to: "126"
count: 11
release: "119-102"
url: "https://uscodex.org/usc/4/116..126"
---

# §116. Rules for determining State and local government treatment of charges related to mobile telecommunications services

- (a) **Application of This Section Through Section 126.—** This section through[^1] 126 of this title apply to any tax, charge, or fee levied by a [taxing jurisdiction](/usc/4/124.md?p=12) as a fixed charge for each [customer](/usc/4/124.md?p=2-A) or measured by gross amounts charged to [customers](/usc/4/124.md?p=2-A) for [mobile telecommunications services](/usc/4/124.md?p=7), regardless of whether such tax, charge, or fee is imposed on the vendor or [customer](/usc/4/124.md?p=2-A) of the service and regardless of the terminology used to describe the tax, charge, or fee.
- (b) **General Exceptions.—** This section through[^1] 126 of this title do not apply to—
  - (1) any tax, charge, or fee levied upon or measured by the net income, capital stock, net worth, or property value of the provider of [mobile telecommunications service](/usc/4/124.md?p=7);
  - (2) any tax, charge, or fee that is applied to an equitably apportioned amount that is not determined on a transactional basis;
  - (3) any tax, charge, or fee that represents compensation for a [mobile telecommunications service](/usc/4/124.md?p=7) provider’s use of public rights of way or other public property, provided that such tax, charge, or fee is not levied by the [taxing jurisdiction](/usc/4/124.md?p=12) as a fixed charge for each [customer](/usc/4/124.md?p=2-A) or measured by gross amounts charged to [customers](/usc/4/124.md?p=2-A) for mobile telecommunication services;
  - (4) any generally applicable business and occupation tax that is imposed by a [State](/usc/4/110.md?p=d), is applied to gross receipts or gross proceeds, is the legal liability of the [home service provider](/usc/4/124.md?p=5), and that statutorily allows the [home service provider](/usc/4/124.md?p=5) to elect to use the sourcing method required in this section through[^1] 126 of this title;
  - (5) any fee related to obligations under section 254 of the Communications Act of 1934; or
  - (6) any tax, charge, or fee imposed by the Federal Communications Commission.
- (c) **Specific Exceptions.—** This section through[^1] 126 of this title—
  - (1) do not apply to the determination of the taxing situs of [prepaid telephone calling services](/usc/4/124.md?p=9);
  - (2) do not affect the taxability of either the initial sale of [mobile telecommunications services](/usc/4/124.md?p=7) or subsequent resale of such services, whether as sales of such services alone or as a part of a bundled product, if the Internet Tax Freedom Act would preclude a [taxing jurisdiction](/usc/4/124.md?p=12) from subjecting the charges of the sale of such services to a tax, charge, or fee, but this section provides no evidence of the intent of Congress with respect to the applicability of the Internet Tax Freedom Act to such charges; and
  - (3) do not apply to the determination of the taxing situs of air-ground radiotelephone service as defined in section 22.99 of [title 47 of the Code of Federal Regulations](/cfr/47.md) as in effect on June 1, 1999.

# §117. Sourcing rules

- (a) **Treatment of Charges for Mobile Telecommunications Services.—** Notwithstanding the law of any [State](/usc/4/110.md?p=d) or political subdivision of any [State](/usc/4/110.md?p=d), [mobile telecommunications services](/usc/4/124.md?p=7) provided in a [taxing jurisdiction](/usc/4/124.md?p=12) to a [customer](/usc/4/124.md?p=2-A), the charges for which are billed by or for the [customer](/usc/4/124.md?p=2-A)’s [home service provider](/usc/4/124.md?p=5), shall be deemed to be provided by the [customer](/usc/4/124.md?p=2-A)’s [home service provider](/usc/4/124.md?p=5).
- (b) **Jurisdiction.—** All [charges for mobile telecommunications services](/usc/4/124.md?p=1) that are deemed to be provided by the [customer](/usc/4/124.md?p=2-A)’s [home service provider](/usc/4/124.md?p=5) under [sections 116 through 126](/usc/4/116..126.md) of this title are authorized to be subjected to tax, charge, or fee by the [taxing jurisdictions](/usc/4/124.md?p=12) whose territorial limits encompass the [customer](/usc/4/124.md?p=2-A)’s [place of primary use](/usc/4/124.md?p=8), regardless of where the mobile telecommunication services originate, terminate, or pass through, and no other [taxing jurisdiction](/usc/4/124.md?p=12) may impose taxes, charges, or fees on charges for such [mobile telecommunications services](/usc/4/124.md?p=7).

# §118. Limitations


[Sections 116 through 126](/usc/4/116..126.md) of this title do not—

- (1) provide authority to a [taxing jurisdiction](/usc/4/124.md?p=12) to impose a tax, charge, or fee that the laws of such jurisdiction do not authorize such jurisdiction to impose; or
- (2) modify, impair, supersede, or authorize the modification, impairment, or supersession of the law of any [taxing jurisdiction](/usc/4/124.md?p=12) pertaining to taxation except as expressly provided in [sections 116 through 126](/usc/4/116..126.md) of this title.

# §119. Electronic databases for nationwide standard numeric jurisdictional codes

- (a) **Electronic Database.—**
  - (1) **Provision of database.—** A [State](/usc/4/110.md?p=d) may provide an electronic database to a [home service provider](/usc/4/124.md?p=5) or, if a [State](/usc/4/110.md?p=d) does not provide such an electronic database to [home service providers](/usc/4/124.md?p=5), then the [designated database provider](/usc/4/124.md?p=3) may provide an electronic database to a [home service provider](/usc/4/124.md?p=5).
  - (2) **Format.—**
    - (A) Such electronic database, whether provided by the [State](/usc/4/110.md?p=d) or the [designated database provider](/usc/4/124.md?p=3), shall be provided in a format approved by the American National Standards Institute’s Accredited Standards Committee X12, that, allowing for de minimis deviations, designates for each street address in the [State](/usc/4/110.md?p=d), including to the extent practicable, any multiple postal street addresses applicable to one street location, the appropriate [taxing jurisdictions](/usc/4/124.md?p=12), and the appropriate code for each [taxing jurisdiction](/usc/4/124.md?p=12), for each level of [taxing jurisdiction](/usc/4/124.md?p=12), identified by one nationwide standard numeric code.
    - (B) Such electronic database shall also provide the appropriate code for each street address with respect to political subdivisions which are not [taxing jurisdictions](/usc/4/124.md?p=12) when reasonably needed to determine the proper [taxing jurisdiction](/usc/4/124.md?p=12).
    - (C) The nationwide standard numeric codes shall contain the same number of numeric digits with each digit or combination of digits referring to the same level of [taxing jurisdiction](/usc/4/124.md?p=12) throughout the United States using a format similar to FIPS 55–3 or other appropriate standard approved by the Federation of Tax Administrators and the Multistate Tax Commission, or their successors. Each address shall be provided in standard postal format.
- (b) **Notice; Updates.—** A [State](/usc/4/110.md?p=d) or [designated database provider](/usc/4/124.md?p=3) that provides or maintains an electronic database described in [subsection (a)](#a) shall provide notice of the availability of the then current electronic database, and any subsequent revisions thereof, by publication in the manner normally employed for the publication of informational tax, charge, or fee notices to taxpayers in such [State](/usc/4/110.md?p=d).
- (c) **User Held Harmless.—** A [home service provider](/usc/4/124.md?p=5) using the data contained in an electronic database described in [subsection (a)](#a) shall be held harmless from any tax, charge, or fee liability that otherwise would be due solely as a result of any error or omission in such database provided by a [State](/usc/4/110.md?p=d) or [designated database provider](/usc/4/124.md?p=3). The [home service provider](/usc/4/124.md?p=5) shall reflect changes made to such database during a calendar quarter not later than 30 days after the end of such calendar quarter for each [State](/usc/4/110.md?p=d) that issues notice of the availability of an electronic database reflecting such changes under [subsection (b)](#b).

# §120. Procedure if no electronic database provided

- (a) **Safe Harbor.—** If neither a [State](/usc/4/110.md?p=d) nor [designated database provider](/usc/4/124.md?p=3) provides an electronic database under [section 119](/usc/4/119.md), a [home service provider](/usc/4/124.md?p=5) shall be held harmless from any tax, charge, or fee liability in such [State](/usc/4/110.md?p=d) that otherwise would be due solely as a result of an assignment of a street address to an incorrect [taxing jurisdiction](/usc/4/124.md?p=12) if, subject to [section 121](/usc/4/121.md), the [home service provider](/usc/4/124.md?p=5) employs an [enhanced zip code](/usc/4/124.md?p=4) to assign each street address to a specific [taxing jurisdiction](/usc/4/124.md?p=12) for each level of [taxing jurisdiction](/usc/4/124.md?p=12) and exercises due diligence at each level of [taxing jurisdiction](/usc/4/124.md?p=12) to ensure that each such street address is assigned to the correct [taxing jurisdiction](/usc/4/124.md?p=12). If an [enhanced zip code](/usc/4/124.md?p=4) overlaps boundaries of [taxing jurisdictions](/usc/4/124.md?p=12) of the same level, the [home service provider](/usc/4/124.md?p=5) must designate one specific jurisdiction within such [enhanced zip code](/usc/4/124.md?p=4) for use in taxing the activity for such [enhanced zip code](/usc/4/124.md?p=4) for each level of [taxing jurisdiction](/usc/4/124.md?p=12). Any [enhanced zip code](/usc/4/124.md?p=4) assignment changed in accordance with [section 121](/usc/4/121.md) is deemed to be in compliance with this section. For purposes of this section, there is a rebuttable presumption that a [home service provider](/usc/4/124.md?p=5) has exercised due diligence if such [home service provider](/usc/4/124.md?p=5) demonstrates that it has—
  - (1) expended reasonable resources to implement and maintain an appropriately detailed electronic database of street address assignments to [taxing jurisdictions](/usc/4/124.md?p=12);
  - (2) implemented and maintained reasonable internal controls to promptly correct misassignments of street addresses to [taxing jurisdictions](/usc/4/124.md?p=12); and
  - (3) used all reasonably obtainable and usable data pertaining to municipal annexations, incorporations, reorganizations and any other changes in jurisdictional boundaries that materially affect the accuracy of such database.
- (b) **Termination of Safe Harbor.—** [Subsection (a)](#a) applies to a [home service provider](/usc/4/124.md?p=5) that is in compliance with the requirements of [subsection (a)](#a), with respect to a [State](/usc/4/110.md?p=d) for which an electronic database is not provided under [section 119](/usc/4/119.md) until the later of—
  - (1) 18 months after the nationwide standard numeric code described in [section 119(a)](/usc/4/119.md?p=a) has been approved by the Federation of Tax Administrators and the Multistate Tax Commission; or
  - (2) 6 months after such [State](/usc/4/110.md?p=d) or a [designated database provider](/usc/4/124.md?p=3) in such [State](/usc/4/110.md?p=d) provides such database as prescribed in [section 119(a)](/usc/4/119.md?p=a).

# §121. Correction of erroneous data for place of primary use

- (a) **[^1] In General.—** A [taxing jurisdiction](/usc/4/124.md?p=12), or a [State](/usc/4/110.md?p=d) on behalf of any [taxing jurisdiction](/usc/4/124.md?p=12) or [taxing jurisdictions](/usc/4/124.md?p=12) within such [State](/usc/4/110.md?p=d), may—
  - (1) determine that the address used for purposes of determining the [taxing jurisdictions](/usc/4/124.md?p=12) to which taxes, charges, or fees for [mobile telecommunications services](/usc/4/124.md?p=7) are remitted does not meet the definition of [place of primary use](/usc/4/124.md?p=8) in [section 124(8)](/usc/4/124.md?p=8) and give binding notice to the [home service provider](/usc/4/124.md?p=5) to change the [place of primary use](/usc/4/124.md?p=8) on a prospective basis from the date of notice of determination if—
    - (A) if the [taxing jurisdiction](/usc/4/124.md?p=12) making such determination is not a [State](/usc/4/110.md?p=d), such [taxing jurisdiction](/usc/4/124.md?p=12) obtains the consent of all affected [taxing jurisdictions](/usc/4/124.md?p=12) within the [State](/usc/4/110.md?p=d) before giving such notice of determination; and
    - (B) before the [taxing jurisdiction](/usc/4/124.md?p=12) gives such notice of determination, the [customer](/usc/4/124.md?p=2-A) is given an opportunity to demonstrate in accordance with applicable [State](/usc/4/110.md?p=d) or local tax, charge, or fee administrative procedures that the address is the [customer](/usc/4/124.md?p=2-A)’s [place of primary use](/usc/4/124.md?p=8);
  - (2) determine that the assignment of a [taxing jurisdiction](/usc/4/124.md?p=12) by a [home service provider](/usc/4/124.md?p=5) under [section 120](/usc/4/120.md) does not reflect the correct [taxing jurisdiction](/usc/4/124.md?p=12) and give binding notice to the [home service provider](/usc/4/124.md?p=5) to change the assignment on a prospective basis from the date of notice of determination if—
    - (A) if the [taxing jurisdiction](/usc/4/124.md?p=12) making such determination is not a [State](/usc/4/110.md?p=d), such [taxing jurisdiction](/usc/4/124.md?p=12) obtains the consent of all affected [taxing jurisdictions](/usc/4/124.md?p=12) within the [State](/usc/4/110.md?p=d) before giving such notice of determination; and
    - (B) the [home service provider](/usc/4/124.md?p=5) is given an opportunity to demonstrate in accordance with applicable [State](/usc/4/110.md?p=d) or local tax, charge, or fee administrative procedures that the assignment reflects the correct [taxing jurisdiction](/usc/4/124.md?p=12).

# §122. Determination of place of primary use

- (a) **Place of Primary Use.—** A [home service provider](/usc/4/124.md?p=5) shall be responsible for obtaining and maintaining the [customer](/usc/4/124.md?p=2-A)’s [place of primary use](/usc/4/124.md?p=8) (as defined in [section 124](/usc/4/124.md)). Subject to [section 121](/usc/4/121.md), and if the [home service provider](/usc/4/124.md?p=5)’s reliance on information provided by its [customer](/usc/4/124.md?p=2-A) is in good faith, a [taxing jurisdiction](/usc/4/124.md?p=12) shall—
  - (1) allow a [home service provider](/usc/4/124.md?p=5) to rely on the applicable residential or business street address supplied by the [home service provider](/usc/4/124.md?p=5)’s [customer](/usc/4/124.md?p=2-A); and
  - (2) not hold a [home service provider](/usc/4/124.md?p=5) liable for any additional taxes, charges, or fees based on a different determination of the [place of primary use](/usc/4/124.md?p=8) for taxes, charges, or fees that are customarily passed on to the [customer](/usc/4/124.md?p=2-A) as a separate itemized charge.
- (b) **Address Under Existing Agreements.—** Except as provided in [section 121](/usc/4/121.md), a [taxing jurisdiction](/usc/4/124.md?p=12) shall allow a [home service provider](/usc/4/124.md?p=5) to treat the address used by the [home service provider](/usc/4/124.md?p=5) for tax purposes for any [customer](/usc/4/124.md?p=2-A) under a service contract or agreement in effect 2 years after the date of the enactment of the Mobile Telecommunications Sourcing Act as that [customer](/usc/4/124.md?p=2-A)’s [place of primary use](/usc/4/124.md?p=8) for the remaining term of such service contract or agreement, excluding any extension or renewal of such service contract or agreement, for purposes of determining the [taxing jurisdictions](/usc/4/124.md?p=12) to which taxes, charges, or fees on [charges for mobile telecommunications services](/usc/4/124.md?p=1) are remitted.

# §123. Scope; special rules

- (a) **Act Does Not Supersede Customer’s Liability to Taxing Jurisdiction.—** Nothing in [sections 116 through 126](/usc/4/116..126.md) modifies, impairs, supersedes, or authorizes the modification, impairment, or supersession of, any law allowing a [taxing jurisdiction](/usc/4/124.md?p=12) to collect a tax, charge, or fee from a [customer](/usc/4/124.md?p=2-A) that has failed to provide its [place of primary use](/usc/4/124.md?p=8).
- (b) **Additional Taxable Charges.—** If a [taxing jurisdiction](/usc/4/124.md?p=12) does not otherwise subject [charges for mobile telecommunications services](/usc/4/124.md?p=1) to taxation and if these charges are aggregated with and not separately stated from charges that are subject to taxation, then the charges for nontaxable [mobile telecommunications services](/usc/4/124.md?p=7) may be subject to taxation unless the [home service provider](/usc/4/124.md?p=5) can reasonably identify charges not subject to such tax, charge, or fee from its books and records that are kept in the regular course of business.
- (c) **Nontaxable Charges.—** If a [taxing jurisdiction](/usc/4/124.md?p=12) does not subject [charges for mobile telecommunications services](/usc/4/124.md?p=1) to taxation, a [customer](/usc/4/124.md?p=2-A) may not rely upon the nontaxability of [charges for mobile telecommunications services](/usc/4/124.md?p=1) unless the [customer](/usc/4/124.md?p=2-A)’s [home service provider](/usc/4/124.md?p=5) separately [states](/usc/4/110.md?p=d) the charges for nontaxable [mobile telecommunications services](/usc/4/124.md?p=7) from taxable charges or the [home service provider](/usc/4/124.md?p=5) elects, after receiving a written request from the [customer](/usc/4/124.md?p=2-A) in the form required by the provider, to provide verifiable data based upon the [home service provider](/usc/4/124.md?p=5)’s books and records that are kept in the regular course of business that reasonably identifies the nontaxable charges.

# §124. Definitions


In [sections 116 through 126](/usc/4/116..126.md) of this title:

- (1) **Charges for mobile telecommunications services.—** The term “charges for mobile telecommunications services” means any charge for, or associated with, the provision of commercial mobile radio service, as defined in section 20.3 of [title 47 of the Code of Federal Regulations](/cfr/47.md) as in effect on June 1, 1999, or any charge for, or associated with, a service provided as an adjunct to a commercial mobile radio service, that is billed to the [customer](#2-A) by or for the [customer](#2-A)’s [home service provider](#5) regardless of whether individual transmissions originate or terminate within the [licensed service area](#6) of the [home service provider](#5).
- (2) **Customer.—**
  - (A) **In general.—** The term “customer” means—
    - (i) the [person](/usc/4/110.md?p=a) or entity that contracts with the [home service provider](#5) for [mobile telecommunications services](#7); or
    - (ii) if the end user of [mobile telecommunications services](#7) is not the contracting party, the end user of the [mobile telecommunications service](#7), but this clause applies only for the purpose of determining the [place of primary use](#8).
  - (B) The term “[customer](#2-A)” does not include—
    - (i) a [reseller](#10) of [mobile telecommunications service](#7); or
    - (ii) a [serving carrier](#11) under an arrangement to serve the [customer](#2-A) outside the [home service provider](#5)’s [licensed service area](#6).
- (3) **Designated database provider.—** The term “designated database provider” means a corporation, association, or other entity representing all the political subdivisions of a [State](/usc/4/110.md?p=d) that is—
  - (A) responsible for providing an electronic database prescribed in [section 119(a)](/usc/4/119.md?p=a) if the [State](/usc/4/110.md?p=d) has not provided such electronic database; and
  - (B) approved by municipal and county associations or leagues of the [State](/usc/4/110.md?p=d) whose responsibility it would otherwise be to provide such database prescribed by [sections 116 through 126](/usc/4/116..126.md) of this title.
- (4) **Enhanced zip code.—** The term “enhanced zip code” means a United States postal zip code of 9 or more digits.
- (5) **Home service provider.—** The term “home service provider” means the facilities-based carrier or [reseller](#10) with which the [customer](#2-A) contracts for the provision of [mobile telecommunications services](#7).
- (6) **Licensed service area.—** The term “licensed service area” means the geographic area in which the [home service provider](#5) is authorized by law or contract to provide commercial mobile radio service to the [customer](#2-A).
- (7) **Mobile telecommunications service.—** The term “mobile telecommunications service” means commercial mobile radio service, as defined in section 20.3 of [title 47 of the Code of Federal Regulations](/cfr/47.md) as in effect on June 1, 1999.
- (8) **Place of primary use.—** The term “place of primary use” means the street address representative of where the [customer](#2-A)’s use of the [mobile telecommunications service](#7) primarily occurs, which must be—
  - (A) the residential street address or the primary business street address of the [customer](#2-A); and
  - (B) within the [licensed service area](#6) of the [home service provider](#5).
- (9) **Prepaid telephone calling services.—** The term “prepaid telephone calling service” means the right to purchase exclusively telecommunications services that must be paid for in advance, that enables the origination of calls using an access number, authorization code, or both, whether manually or electronically dialed, if the remaining amount of units of service that have been prepaid is known by the provider of the prepaid service on a continuous basis.
- (10) **Reseller.—** The term “reseller”—
  - (A) means a provider who purchases telecommunications services from another telecommunications service provider and then resells, uses as a component part of, or integrates the purchased services into a [mobile telecommunications service](#7); and
  - (B) does not include a [serving carrier](#11) with which a [home service provider](#5) arranges for the services to its [customers](#2-A) outside the [home service provider](#5)’s [licensed service area](#6).
- (11) **Serving carrier.—** The term “serving carrier” means a facilities-based carrier providing [mobile telecommunications service](#7) to a [customer](#2-A) outside a [home service provider](#5)’s or [reseller](#10)’s [licensed service area](#6).
- (12) **Taxing jurisdiction.—** The term “taxing jurisdiction” means any of the several [States](/usc/4/110.md?p=d), the District of Columbia, or any territory or possession of the United States, any municipality, city, county, township, parish, transportation district, or assessment jurisdiction, or any other political subdivision within the territorial limits of the United States with the authority to impose a tax, charge, or fee.

# §125. Nonseverability


If a court of competent jurisdiction enters a final judgment on the merits that—

- (1) is based on Federal law;
- (2) is no longer subject to appeal; and
- (3) substantially limits or impairs the essential elements of [sections 116 through 126](/usc/4/116..126.md) of this title,

then [sections 116 through 126](/usc/4/116..126.md) of this title are invalid and have no legal effect as of the date of entry of such judgment.


# §126. No inference

- (a) **Internet Tax Freedom Act.—** Nothing in [sections 116](/usc/4/116.md) through this section of this title shall be construed as bearing on Congressional intent in enacting the Internet Tax Freedom Act or to modify or supersede the operation of such Act.
- (b) **Telecommunications Act of 1996.—** Nothing in [sections 116](/usc/4/116.md) through this section of this title shall limit or otherwise affect the implementation of the Telecommunications Act of 1996 or the amendments made by such Act.