Custer weekly chronicle. [volume] (Custer City, S.D.) 1890-1931, 1913-10-18
HOW INCOME TAX WORKS
Treasury Officials Are Preparing for 1
Flood of Questions About the
New Income Tax.

of the tariff bill about to become a law
strikes more intimately at the tax pay
ing citizen than does the indirect taxes
collected through the custom duties.
One of the first steps to be taken, to
get general information before the
public will be to distribute income tax
blanks through postoffices, internal re-
venue offices and other federal agencies.
However, the fact that he does not re
ceive blank or request to pay the
tax will not exempt taxable person
from the penalties of the law.
Representative Cordel Hull of
Tennessee, who drew the income tax
provision of the tariff bill, which soon
will become law, has made public
detailed explanation of the tax plan
as it will touch the individual citizen.
How The Law w Works.
THE treasury regulations soon TO be
prepared will make clear to every tax
payer the requirements of the law and
its application to income derived from
said, "Any person who keeps familiar
| with his business affairs during the
year should have no difficulty in exc
cutting his tax return.
''The income tax is divided into two
phases, the normal tax of per cent on
the whole income above $4,000 and the
additional tax that begins with an extra
per cent above $40, 900 and is graduated
to 5 per cent above S50,0OO Wherever
the income tax is paid at the source by
a corporation for its employees or in
similar cases only the per cent normal
tax is to be paid. The individual has
to pay any additional tax himself.
"The provisions of the law requiring
the tax to be withheld at the source
does not take effect until November l,
1913. For the first year the citizen will
make return to the local internal re-
venue collector before March /, 1914, as
to his earnings from March /, 1918 to
the end of this year. The collector will
notify him June lst how much he owes,
and the tax must be paid by June 80.
After next year the tax will apply on
the full calendar year.
Hits Foreign Residents.
" If the income of a person is under
So, 900 or if the tax on the same is with
held for payment at the source, or if
the same is to be paid elsewhere in the
United States, affidavit may be made to
each fact, and thereupon no return will
be required.
''The tax covers all incomes of citizens
of the United States, whether living
here or abroad those of foreigners
living in the United States, and the net
income from property owned, or bust
ness carried on in the United States by
persons living abroad.
'Ghe net income from salaries or any
compensation for personal services; in
comes from trades, professions, business
or commerce; from sales or dealings in
personal property or real estate; from
interest, rent, dividends from securities;
for all business carried on for gain.
Requests will not be considered in
come; nor will life insurance paid to a
beneficiary returned to the insured
person as paid up or Surrendered
policy be taxable. Interest on such
property will be included as income,
however.
Business Cost Deducted.
The amount that may be deducted
from total income includes the cost
of carrying on business, actual loses,
depreciation allowances and tax exempt
or tax paid money. Living expenses
cannot be deducted, nor can money
spent for permanent improvements
on property.
"The form that is to be filled out by
the taxpayer will be drawn up soon by
the commissioners of internal revenue.
The taxpayer will have to give his gross
revenue, and then specify and claim the
deductions to which he feels entitled.
Unless a mans income tax is paid at
the source he must hunt up tax blank,
fill it out and see that it finds it's way
to the federal officer of the district be-
for March lst, 1914.
Firms, corporations and the like
having the handling of interest, rent,
salaries or other portions of the income
of any citizens are compelled to deduct
the tax for the individual then will re-
ceive a receipt showing he has paid
his tax"
About noon Monday fire was dis
covered in the building on the corner
Third and Washington streets owned
by 7. w. Delicate, and occupied by Mr..