The Olneyville times. (Olneyville [Providence, R.I.]) 1887-1917, 1913-10-10
INCOME TAX
FROM 435,OOO
Under New Law That Mum.
Der of individuals Are
Taxable
HEAVY PENALTIES FOR
THOSE WHO DODGE

Washington.-In statement de-
signed for the layman and intended
10 strip the income tax section OF the
tariff bill OF its technical language.
Representative Cordell Hull, who
drafted the section. makes plain how
the new tax will apply 10 the <35,o00
citizens OF the United States who,
the Treasury Department estimates,
must make returns under II.
All disputes may be carried 70 the
Commissioner OF Internal Revenue.
whose decision is final.
JUST WHAT is INCLUDED IN
WORD "NcoME."
Under the terms of the bill in It's
final form the net income OF each In
dividual taxpayer Is TO include the
following items:-
All gains, profits and incomes de-
rived from salaries, wages or COM
pensaton for personal services OF
any kind, professions or vocations,
business, trade or commerce. sales or
dealings In property, real or personal.
interest, rent, dividends and secur.
tiles. Also the gains and profits from
any transactions of lawful business
and the income OF property acquired
by gift or bequests, Neither the re-
turn nor any part OF the principal In
vested in life insurance 10 the assured
not the proceeds Of policies paid upon
death, are included as income.
From these items OF income the fol.
lowing deductions are allowed
/. Necessary expense actually In
Cured in carrying on any business.
2. All interest accrued and pay
able within the year on indebtedness.
3. All national, State, county.
school and municipal taxes.
T. Losses actually sustained dur
ing the year In business, not compen-
sated by insurance or otherwise, aris-
ing from fire, storm or shipwreck.
5. Debts actually ascertained TO be
worthless and charged off during the
year.
G. A reasonable allowance for the
exhaustion or wear and tear on prop
erty, not TO exceed, In the case OF
mines, Ave per cent. of the gross
value at the mine of the output for
the year.
Z. All income, the tax upon which
has been paid at the source.
8. Amounts received as dividends
upon the stock OF any corporation.
which is taxed upon It's net income,
but such dividends shall not be de-
a., hA
as a part OF the gross income.
The following items will not be al
lowed as DEDUCTIONS
/. All personal living or family ex-
penses.
2. Taxes assessed against local
benefits.
3. All expense of restoring prop
erty or making good exhaustion there
of, for which an allowance has been
made.
4. Accounts paid for new build
ings, permanent improvements made
to Increase the value Of any property
or estate.
In computing the net incomes the
following exemptions are allowed
/. Interests upon the obligations
OF a State or any political subdivision
thereof
2. Interest upon the obligations OF
the United States. or its possessions.
The President is exempt from the
tax as are also the judges OF the SUI
preme and inferior courts Of the
United States and all officers and en-
ployes OF state or any political sub
division OF a State Senators and
Representatives are obliged TO pay
the tax.
These are the items on which In
come will be withheld at the source
whether or not II amounts TO $4,000.
/. Income derived from bonds,
mortgages and other indebtedness OF
corporations and Joint stock com.
panies
2. Incomes composed Of coupons.
checks. or bill OF exchange for or In
part payment OF interest or dividends
on stock or obligations Of foreign cor
poratlons.
3. Interest upon bonds OF foreign
companies
4. Foreign mortgages or like obli-
cations not payable in the United
States.
The rates provided in the law are
per cent. on the net incomes over
50, 900, or $4,000 in the case Of mar.
ried person, up 20 $4,000 and the
following surfaces:
From $40 900 20 $4,000 per cent;
from $4,000 10 $4,000, 2 per cent;
from 5000 10 100000, 3 per cent;
from 100000 10 s25O,OO0, per cent;
from $3.50, 900 10 $500, 900, per cent;
over 100000. per cent