, 1875-11-18
Settlement OF tho Long-Pcntl;no
Illinois Central Tax Case,
How tho Company Saved 1921, ,1a5, an,
Lost B24l, ,304.
liamors Concerning Change IN tle N,
dian Commisstonersllip.
Tho Vioe-Preaiaent Still Very Weak, br,
Improving slowly.
THE ILLINOIS CENTRAL TAX.
4 FlN&L RErFLEMEHr.

Gtft3nt DlstH@tcH ~ 4He Ca'cuH9 tribune.
WAButHoroN, y, e., Nov. 17.-1n Au7a.4
1870. Tho Illinois Central llaflroad Cou,..,, =,
I,atlo dividend of o., 1903, 776. upon which. !,
September. 1871, tho United B.atoa Govofpueat
nsBcHaed II dividend tar OF f03,ts3. Tho cor,
lany obtained All injunction aeaiust tas g..
lcc.of Of Iutesn1t Revenue. which waa IN, !.
ta.netl for long time. although It haa slncs n,
roerea that tue Court had no rightful aa:ta..
,ty to thus ento!n United Staten o:Gr,-
The Company claimed that o pau5,
ot tho dividend was dcsisod ho,,
pa1es Of the linda granted by f.,
General 0ovc,nmens. Agents Of tho Goy,r.
nent wcro directed to make tho ncceHaary e.,
animation Of tue books Of tie CoMlpany u tai,
ruso, and Of tLolr ]apd.booka as New Yyft
This examination showed las all Ut tho tIiyic.nI
except 372l,27t was derived from, tito salts n
such land. Tho total amonut Of dividend u,to
wil,c, tho loyotnmont tnndo its asAcaa.root 81,
about el,250,0oo. Moro than ouo.halt Of tIr,
dividend WIS derived from different u5sr.
than tle zoat anrninEs Of tho road. Tbo Tr:ar
nry Department has to-day
ADJUSTED 7ula ACCOUNT
by permitting the Illinois Centra! Company +,
ing 9Sb.063 with interest from Sep temtcr, ISL
III full for tho entire assessment. The ton,
nu.ount which tho Company will bo ro7ulr.l /,
ray OF tax. interest, md pcnaity, Is 153177, T.,
Government originally claimed 93j,G36. III.
Company has aucceedn1 In reducing tis orjsiua
demand OF tho Government By e27.125.
Tho nuccoss Of tho Company In thta dir,ctis,
IL ineignl1cans In comparison with lta buna,,
ip another. Tho Commissioner OF lt;,tus,
Ro. emo has recently docldod that eaca Of t,ai
granted By the aovornmcut to raleoalB sre frc,
from tax. With the exception OF tile intcre It shs;
fH4nHf $tAk to-
| uo.ea taken for gales OF sucil land wtan .La
uaes ase tnado on tImo. This decision Of III,
! Commissioner is constsuctioo Of IN old itr
which feeGau very plain and unhmbguous In IL
terms. Tho Illinois Central GuthortioI ncsp
| either ignorant Of this law or
FAXED nlunIt.Y TO INTERPRET IT,
for that Company hos aIready paid re7ennct:,
upon dI7It'onlH derived from tho snles VI IL
granted iAndB which n3Bre9ftos $ali,33i III,
| Commissiuncr OF Internal Rovonno 1loT ,lecIs,
| Il!li-sae8 nro exempt from taxation. Tho IT,.
no,s Central nuthoftioa havo tho sattafac 10, Of
lnovtug that The euit by which they reats :ol t,
payment Of tho assessment upon the i Eten,
leularad from tho saies Of land sagad tho Con-
pnny e27.l25; nlsu disclosed the fael
t'241.8U4. This money cahnot DO recovered fIo1
| tho Treasury By any prucoss Of law, a t'o e:1s
within whltll II might lawfully bo rofunlr1 e1.
pirad by legal linitation ou Jnne 9, 1879.
| THE QHLI REMEDY
for tho Company 10 by speca! 1ct OF caoeres..
Complaints hnyo been nhdo that, III fo,la.:
dispatches On tho subject the dis,dtna upon
which tho lorernmeAt lowed tho tax Of t9G,jii
was characterized as fictitious. Tho 1'4roa1
Company has even lodged i complaint sIlh thu
TrcaHury Department CO account Of ths ass os
the word fictitious. Tho Treasury aushositiea
don'e understand that tho divldaul was fctlti61i
tu the Henso t1at tho money was poI lirided
among tho stockholders. but 1t Is admitted l.
the Company TINT the SUM OF el.203,f'5 ~
conpoHod Of earnings OF tho road. WtIe IN fia
| OF this amount tho eum Of ~, ,29l WAS 1cr;sea
from the enies OF lands. Tho fiction conatsa
only as the dividend w8s
| ONLY PARTLY EARNED.
Tbs stockholders could easily know. II the of8eara
Of tito Company did not, that sales Of grant laada
vere not properly taxabio with divide II t,1.
aud that tho proceeds Of auch sales coall uss
be returned "a dividends. The seockholatr1 ho'
know that wiils Tor thseo years they Eos,1Ted
dividend Of 10 per cent instead OF pr cens
which tho legitimate earntngs alone "ar:sotcl.
the Company has paid dividend tax Of 5po'
cent upon 55.092.G09 tho aggregate proceeds q
the eAlos Of grant lands, upoa which ~ tax VIZ
duo. Tbs dividend was cettAiuly not i!es,eIoas
bnt tho 10 per cent dividends Heta declared u2as
thu earnings Of tho road alone.