The Birmingham age-herald., 1913-04-15

distasteful features as possible in order
that the collectors of internal revenue
might draw the money into the treasury
with as little disturbance to the individ-
uai and business as possible. 1t there
fore provides that as much as possible the
tax win be collected at the source.
1t is estimated that a very large pro-
portion of the incomes In this country are
derived from holdings in corporations and
the law provides that the officers of these
corporations shall deduct from the inter-
est from bonds and the returns from other
securities due the holders In the corpora
tion the amount which they owe the gov
ernment In this way the Individual does
not actually have TO pay out the money.
he is saved the pang of separating him
self from actual cash; he simply receives
in dividends and interest Just the amount
necessary to pay his tax, less than he
would otherwise have received. This Is
considered an almost painless method.
How Figures Are Submitted
At the end of the fiscal year the proper
officer of corporation will present to the
internal revenue collector a statement
showing the names of stock and bond
holders and the amount of securities each
holds in the concern. Attached to this
will be a statement of the earnings of the
corporation and the interest and dividends
accrued to each Individual holder. In each
case where the amount due to holder is
Nin excess of $4,000 and less than $4,000 the
treasurer of the corporation will deduct 1
per cent and mail it TO the treasury de-
partment. es w
In case of larger holders the additional
1, or per cent will be added as the
case demands. Thus when the stockhold-
er gets his check he finds that his income
tax has been already paid and been
charged against him, and virtually IT Is
only part of the legitimate expenses OF
the operation of the business, and In
this manner loses much of the sting.
To Offset Abuses
In cases where the same individual is
interested in two or more corporations
and consequently has two or more sources
of revenue, only in one case, of course, is
it allowable for the exemption of $4,000 TO
be deducted from the amount on which he
is to pay Under the law, therefore, 1t Is
up to this individual affected to notify the
corporations and also the collector of in
ternal revenue so that the original $4,000
may be exempted for him.
In order to offset abuses that might
arise under this system 1t will be neces-
sary for the collector of Internal revenue
TO keep and maintain comprehensive sys-
names and addresses of every man and
woman in the United States who has an
income in excess of $4,000, together with
kinds of investments he has and the rates
of interest he receives.
The thousands of individuals in the
country who have no interest in corpora
tons or business enterprise of any char
acter the collection will be somewhat
more difficult and more personal. Mort
gage records in the various counties IN
the United States will have to be resorted
to to ascertain the holders of mortgages
with the amounts and rates of interest,
and in this way the agents of the inter-
nal revenue collector can ascertain very
accurately the amount of net returns for
each Individual.
Incomes of Professional Men
In England in the case of a professional
man the income is returned to the depart