11 Jun Getting Started with Telecommunications Compliance
For many first-time telecommunications resellers, compliance can seem like a daunting task. You know you need to be properly registered with the state and federal commissions and the proper taxing authorities. You know it’ll help reduce your fees but where do you even start?
Thanks to our latest interview with GSA, we can finally outline the basic steps to achieve compliance so you can operate within the proper channels and avoid unnecessary fees.
1. Firstly, Obtain Carrier Registration from the Secretary of Your State.
In order for your company to be legally recognized as a corporation, partnership, LLC, or Sole proprietor, you must first obtain carrier registration. You do this by obtaining a federal registration number. Which is no different than filing for a Federal Employee Identification Number (FEIN) for the IRS. It allows the federal government to gather key information about who owns the company. Such as, what your official address is, how customers can find you, and who your registered agent is. This will be a one-time registration and it is relatively easy to do and inexpensive to file. Importantly, you are required to register before you obtain 1) a sales tax resellers certificate and 2) a Public Commission designation as a carrier from your state.
2. Secure a Sales Tax Resellers Certificate from Your State’s Department of Revenue.
In almost all cases, there is some form of tax or fee that your state requires you to pay on the transactions you provide. The Tax Resellers Certificate assures potential vendors you approach that you’re legitimate. This is an important step towards telecommunications compliance, because if a reseller is fraudulent, vendors are often required to pay the unpaid sales tax.
To find your state’s rules of resale certificates, click here.
3. Apply for a Carrier Federal Registry Number and 499 Filer ID.
Additionally, you must register with the Federal Communications Commission (FCC) after you’ve obtained the necessary registration and certification. They will provide you with a Federal Registration Number (FRN) and the corresponding FCC 499 Filer ID (or FID). You can do this using their online portal CORES. This portal also provides you with tools to manage your FRN, including viewing financial information. Once you’ve registered, your FRN will be available to you immediately. Overall, the entire application process should take you approximately 3-4 hours to complete and requires a one-time fee of $200.
Please note that this registration and adherence to the FCC requirement will get rid of a charge for fees associated with Federal Universal Service Fund and other telecommunications requirements.
IMPORTANT: Any carrier that allows end-users to make international calls must fill an additional application called FCC 214. To learn more about when and how to submit that form, click here.
4. Finally, Open a Reporting Account with the Universal Service Administrative Company (USAC).
Once you’ve registered with the FCC, you create a reporting account with the USAC, the FCC’s collection agency. They’ll be the entity collecting the fees associated with the industry. You do this using the filer ID you just received. All in all, this is typically a 2-3 hour process and requires a one-time fee of $250.
To register, click here.
5. OPTIONAL FOR COMPLIANCE: Obtain State-Level Telecommunications Registration.
Some states don’t require resellers to apply to become a VoIP carrier, but it’s best to be sure. Please contact your state’s public commission to see what it requires in order to perform business. This requires a one-time fee of approximately $350.
There you have it! Once you’ve completed these steps and paid the necessary dues, you’ve achieved telecommunications compliance. Now you can enter into wholesale contracts with carriers, white-label platforms, and transport resellers. Without worrying about extra charges or legal ramifications.
In summary, to achieve compliance you must:
1. First, register in your home state, with:
a) Your secretary of state
b) Your department of revenue
c) IF REQUIRED: Your state’s public commission.
2. Then, register with the FCC
3. OPTIONAL: Additionally, you could obtain a state-level telecommunications registration
If you have any questions about telecommunications compliance, or would like assistance, let Global Strategic Accounts (GSA) help! Visit their website or call 833-447-2829.
Download our comprehensive checklist here.