Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1895-03-07
NCOME-TAX RULINGS
IMPORTANT DECISION As TO LAW
YERs AND PHYSICIANS.
Husbsnas Losscs Cannot he
Charged Tn TO Wife's Income
Amounts Paid for Ftrc.Insurance
May he Deducted.
New York Tribunc)

The circular issued by the Commits
s!oner of Internal Revenue TO the col
lectors. giving notice OF the extension Of
time for filing returns from March LIST 10
April 18th, contained two other points
OF importance 20 taxpayers II is or
derod that in computing incomes under
the income-tax act amounts paid for
FIRE insurance may be deducted. In this
the action OF Edward Groose. the coll
isetor Of the Third District. is approved.
II is further ordered that corporations
In making returns OF their incomes, need
not gives the names and salaries Of en-
ployees. This does not mean that sala-
RIGS are exempt. but II relieves the cor
porations only from giving names Of their
employees and the amounts paid 10 them
Individually.
The question raised h. some people as
10 the legality Of collections made by
deputy collector is not regarded with
any concern by the collectors. Mr.. Crosse
said that he thought there would be no
trouble on that score.
"If find Il necessary" he said. "to de-
puilze a person TO represent me In the
matter OF collecting the income-tax. ana
IL that person acts under my instruc-
tons. being responsible for his official
acts. there should be no doubt as to his
competency"
INTERPRETATIONS
In answer to questions sent 10 the Com
missioner at Washington. the Collector
Of the Third District received the fol-
lowing interpretations Of the law. which
will be read with much interest:
l. The gift OF person TO his grand
child or TO any other person not Il
member Of his family Is not an allowable
deduction. in the first instances. from
the income of the person who gave the
same and I, is. therefore. subject TO
taxation IN his hands. The person who
receives the same receives 1t clearly as
gifi. and II such gift with his other
sources Of income. places his income
above the taxable limit. he is liable TO
& tx upon all the excess above said
limit
2 II the father pays tax upon his
income, and the income Of all the mem
bcrs Of his family. the amount of his
gift or allowance TO minor child
should not escape taxation. whether com
putcd while IA the hands Of the father, or
by him in making return for the aggre-
gate income of all the members OF his
family.
,. Profits realized from the sale Of
stocks or other personal property. made
pier TO the year 1894. and profits from
eli business transactions made prior 70
said year. are not 10 be treated as
taxable income. without reference TO the
time OF payment.
ESTIMATED.
4. Losses sustained by exchange Of
real estate must in all instances be csti-
mated losses while the property remains
in The hands Cf the original parties. ana
Is. therefore not deduCtihle from income
Profits anu losses arising from sales OF
real estate purchased prior 10 De
cember 81. 1852. cannot be considered In
any income return.
g. In cases where lawyers or physi- |
clans. or other persons, refuse 10 make |
their returns in compliance with the |
law and regulations. or refuse - return |
income for which they are liable under |
said law and regulations. or render any |
returns which are false within the mean |
ing Of the law and regulations collectors |
should make said return ana add the |
prescribed penalties thereto.
6 The instructions as TO the trustees
income return by trustees must be held |
to mean. as 1t states. that the sum re-
cc!ved from trustees by the henehciaries
should 10; he returned as taxable in
come" tie same should be. however,
noted as income. or deducted as an
amount upon which the tax IS already |
been paid. The instructions refer prac-
tlcally 10 cases Of benciiciarics who have
income In addition 10 that received from
Il trustee. and are intended to prevent es-
cape OF income from taxation.
z No deduction can he allowed for rent
paid for a residence. where persons live
in rented houses. The exemption of 5000
Is clearly intended 70 cover such expenses.
S when a husband engaged in business
sus;ains losses I'm excess Of his income. he
cannot for the purpose Of evading income
tax include the separate income of his
wife a. a part OF said losses. When the |
wife has "A separate estate producing an |
income above the taxable limit under her |
control she must make "A return for the |
ftme and Of the profits derived therefron.
without regard to the business losses OF
bar husband