How to Understand Your Internet Bill

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Category: Internet
Posted on: 09/11/2020
How to Understand Your Internet Bill

Google, click, download, send – you use the internet for a variety of things. Whether you are working, streaming a movie, or reading the latest blog post for pleasure, you are using data. Unless you are on a public wi-fi network or using someone else's internet service, you are paying for the privilege of using the internet through data usage. You can get internet access through DSL, cable internet, a cellular company, or your local telephone provider. Every company will have a different plan, but you will generally see some of these common charges and fees on your monthly bill.

Summary Charges and Details

Most monthly internet bills have two main sections. The first is a summary of all of the services you've purchased and the charges for each. These may include the monthly charge, equipment costs, taxes, surcharges, fees, and more. There will be a total that you owe and a due date. Your account number and where to send your payment are prominently displayed. You will also see any payments you have made since the last bill and any late fees or penalties if your payment was not received on time. Details of each of these line items will appear in the second section of the bill.

Monthly Internet Fees

When you signed up with your internet provider, you most likely chose a plan that you thought would fit your online needs. This was a set dollar amount, probably for a specific amount of data you thought you were likely to use. This is often measured in gigabytes (GB). For example, let's say you agreed on a plan that gave you 10 GB per month. This is a set charge on your bill, whether you use 2 GB or all 10. If you go over this amount, the provider will either cut you off or charge you for additional GB. They could add on a block of 1-2 GB at a time for an additional charge. Alternatively, you may have purchased an unlimited data plan for a set charge. In that case, your cost will be consistent.

If you have internet with your cable, there is usually a basic charge for the package you chose. Your bill may list more details next to the charge, such as the expected download speeds, cloud storage, and other options. If you have bundled services, there may be one section for the internet service charge and more sections for additional services such as TV and telephone - or they could be all lumped together in one place.

If you are starting or stopping services during a particular month, the charge will be prorated. This is done by taking your monthly fee, dividing it by the days in the month, and then charging you for the days you were actually on the plan.

Equipment Rental Fees

Depending on the type of internet service you have, you may be renting or purchasing equipment. Like financing your phone through a cellular service provider, your cable company may have sold or rented you a modem or a router. Charges for this equipment are on your bill. There may be taxes and fees associated with this rental or financing as well.

Additional Fees and Charges

If you added, changed, or canceled any of your services in the past month, those changes should also be reflected on your bill. If you upgraded or simplified your internet or data plan or had service done, the details will be shown. If you do not understand any of the charges on your bill, be sure to call customer service and have them explain it to you.

Taxes and Surcharges

State and Federal taxes are complicated, and you don't have much say in them. Which fees you see depends on which service you have. Your bill may have an explanation of each of these charges. If not, it doesn't hurt to ask. Here are a couple of the common taxes and charges you might see and what they mean.

  1. Federal Universal Service Fund is a fund established by the federal government to provide internet services to schools, public libraries, and rural healthcare facilities. The provider passes this fee onto you. Sometimes there is a State Universal Service Fund as well.
  2. Regulatory charge – the provider collects this from each customer to defray the costs they pay to the government for administration and licensing fees.
  3. Administrative charge – your internet provider passes on the costs they incur from fees and assessments on network facilities and services, property taxes, and other business costs.

The good news is the Internet Tax Freedom Act bars federal, state, and local governments from taxing internet services. The bad news is that some fees have a grandfather clause that hasn't expired yet. This means if they charged taxes before 1998, they are still allowed to charge that tax today. The tax exemption mentioned here applies to internet service only. Your modem, router, or other devices are still subject to taxes.

Depending on what state, county, or city you live in, there may be many other taxes, fees, or surcharges. It is essential to understand each of these charges to ensure you are not being overcharged or charged for services you did not order.

Be a Wise Consumer 

Check your data usage and make sure you are on the optimal plan for your internet needs. Check and see if you are receiving any discounts you might qualify for. If there are any charges, fees, or taxes that you don't understand, reach out to your provider. And remember, you have options for internet services. Find one that fits your needs.

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