Evening star. [volume] (Washington, D.C.) 1854-1972, 1912-03-02

favor of each ward, except in cases where
two or more wards are comprised In one
family and have joint property interests,
when the aggregate deduction in their ia
vor shall not exceed $1,000. Besides pro-
viding for the deduction of income re-
ceived from corporations. joint stock COM
panies and insurance companies as dtvi-
dendS when these dividends have already
been assessed under the corporation tax
law, the Underwood bill exempts the in
come of any person from firm or CO.
partnership which has been taxed under
the present bill.
Tax Year Ends December 81.
''The net income shall be computed for
the year ending December 81. All firms,
copartnership and persons subject to the
tax will be obliged on or before the 1st
day of March, each year, to make q true
and accurate return under oath or AFR
nation to the collector of internal revenue
of his district. This return shall be In such
form as the commissioner of internal rev.
enuc shall prescribe, setting forth spe-
officially the gross amount of income from
all separate sources and from the total
thereof, deducting the aggregate items of
expenses and allowance herein authorized
and likewise returning the amount of in
| come, gains and profits of any minor or
person for whom they act
Persons having less than $500 gross
income will not be required to make such
| report. The collector or deputy collector
is empowered to increase the amount Of
any return when he has reason to believe
that the same is understated. This power,
however, Is curtailed to the extent that no
such increase shall be made except after
due notice and upon proof of the amount
understated. In case any person having
a taxable income neglects or refuses to
make a return 1t shall be the duty of the
collector to make such return according
| to the best information he can obtain and
to add 80 per cent as a penalty to the
| amount of the tag due on such return.
In cases Of false returns the collector is
authorized to add 100 per cent penalty to
the amount of tax ascertained to be due.
1T is further provided that any person
shall be permitted to declare under oath
that ne or she is not possessed or an IN
come of 5000, and If the collector shall
he satisfied as to the truth of this decla-
ration such person shall be exempt for
that year; also If the return Of any per-
son shall have been increased by the
collector such person may be permitted
to prove the amount liable to be assessed.
Such proof shall not be considered as con-
elusive Of the facts and no deductions
claimed in such cases shall be made OF
allowed until proved by the collector.
Right of Appeal.
Every taxpayer is given the right to
appeal from the decision of the deputy
collector Of the district and, if necessary,
to the commissioner of internal revenue,
whose decision shall be final The bill
provides for hearing before the internal
revenue commissioner upon the service of
notice. The government, however. is EN-
powered to take testimony on notice to
rebut the testimony of witnesses exam
ined by the person who is taxed.
All assessments and notices of assess
ments shall be made before the first day
nj mr. HI hnf 1yrr1n
80 each year. The commissioner of in
ternal revenue is empowered to make col
lections for fraudulent returns any time
within three years after the return. For
failure to pay the tax by June 30 pen
atty of ) per cent will be imposed and
interest at the rate of 1 per cent per
month.
Government paymasters and disbursing
officers are authorized to withhold from
the incomes of government employees
liable under the bill the FER cent tax.
Every person. firm or corporation who
pays any officer or emplOye salary or
any other compensation. including inter
est or accrued profits. in excess of 5000
a year shall render return to the deputy
collector and shall deduct and pay the tax
to the government.
THE bill also provides that every lessee
or mOrtgagor of real or personal property
who pays to the lessor or mortgage in
terest or compensation in excess of 5000.
and every trustee executor, administra-
tor, agent or receiver paying any person
the taxable amount shall make a return
and deduct the tax. Persons whose in
come is trapped in this way will not be
obliged to make a return unless they have
other sources of income
Exemptions Noted.
"a few persons are fortunate enough to
| escape the Operatio nof the bill. Salaries
paid to state, county or municipal Off
GERS are exempt. and SO also is the inter
est on bonds or other obligations of a
state and its political subdivisions. Also
|, the proceeds of life insurance policies
paid upon the death of the persons in
sured are not to be included in comput-
ing the net income. All property passing
by will or by interstate laws or trans
ferred by deed or gift to take effect in