Randy Dillard, Sales and Transaction Tax Lead at TaxConnex, joined Doug Green, Publisher of Technology Reseller News, for a Cloud Communications Alliance (CCA) podcast focused on one of the most complex—and often underestimated—issues facing cloud communications providers today: telecommunications tax compliance.
Dillard explained that TaxConnex serves as a specialized outsourcing partner for telecom and transaction tax compliance, working closely with regulatory experts to deliver a unified approach that spans sales and use tax, telecom-specific taxes, and state and local filing obligations. Unlike general accounting firms, TaxConnex is purpose-built for the telecom and cloud communications industry, where tax requirements can extend far beyond state-level filings into counties, cities, and even ZIP-code-level jurisdictions.
He emphasized that telecom taxation is fundamentally different from standard sales tax, with layered obligations that can include “tax on tax,” recurring billing changes, credits, and constant regulatory updates. With more than 50 states, thousands of local jurisdictions, and frequent filing deadlines, providers face significant risk if compliance processes are not handled accurately and consistently.
Dillard also stressed the importance of timing, noting that providers should engage a telecom tax specialist before launching new services or expanding into new markets—not after revenue is already flowing.
“It often makes sense to pause and speak with a telecom tax advisor before you open that honeypot,” Dillard said. “Understanding your obligations upfront can save you from costly penalties, audits, and surprises down the road.”
TaxConnex’s role, he explained, goes beyond filing returns. The company provides monthly tax liability reporting that shows what has been collected, where it is assigned, and how it will be remitted—giving providers visibility and confidence that nothing is slipping through the cracks. This becomes even more critical as AI-driven services and usage-based models create unexpected spikes in transactions and tax exposure.
As an active member and sponsor within the Cloud Communications Alliance, TaxConnex views its role as helping demystify telecom tax compliance so providers can focus on growth, innovation, and customer success—while staying compliant in an increasingly complex regulatory environment.
Learn more: https://www.taxconnex.com/