IRS, Treasury Want Cell Phone Tax Repealed

IRS Commissioner Doug Shulman said the tax is "poorly understood by taxpayers," and acknowledged it was difficult to enforce consistently.

"The passage of time, advances in technology and the nature of communication in the modern workplace have rendered this law obsolete," Shulman said in a statement.

Shulman said he and Treasury Secretary Timothy Geithner were asking Congress to repeal the tax. The House passed a bill to repeal the tax last year, but it stalled in the Senate. This year, bipartisan bills have been introduced in both chambers.

"We need to modernize the laws to reflect the reality that cell phones, BlackBerrys and text messaging are an everyday extension of the workplace and are here to stay," said Sen. John Kerry, D-Mass. "Cell phones are no longer executive perks or luxury items, and our tax code cannot treat them that way anymore."

Just last week, the IRS issued a request for comments on ways to improve compliance with the law. One option suggested by the IRS would assume that personal use accounts for a quarter of the phone's overall use. Another would require workers to document their personal use of company cell phones.