Evening journal., 1913-10-22
INCOME TAX
FROM BONDS
And Tenants VIII Split Tax
able Landlords Rentals
With the U. S.
TREASURY DEPARTMENT
PROVIDES SOME PENALTIES

WASHINGTON. d. c.. Oct. 22.-
Perplexities Of bankers, corporations
bondholders. landlords and tenants
concernir- the process of paving the
income tax at the source. viii be
cleared by regulations which will be
issued by the treasury department
soon.
on November I. banks, fiscal agents
and corporations will begin with
holding the tax on bond interest from
taxable bondholders for transmission
20 the government Likewise ten
ants win begin Withholding the tax
on rentals frt taxable landlords
for payment to the government
In order TO Obtain the exemption
provided by law il will be necessary
for the hondholder TO identify him
self to the corporation paying the
tax. When ne deposits his coupons
ln the bank the bondholder viii at
tach form slip stating that he is
the owner OF the bonds II his whole
income is sufficient 10 be taxable. the
hank will credit him with the amount
Of the coupons less the tax. When
these coupons reach the corporation
or its fiscal agent. the difference be-
tween the amount paid the bond
holder and the face value OF the cou-
pons will be turned over TO the gov
crnment II no statement accom-
Danies the coupons. the bank will de-
luct the tax.
Exemptions Must BE Filed.
n the bondholder hasNan income
lnder the exemption limit Of $4,000
'Or unmarried or $4,000 for married
PERSONS. he will state on the slip he
attaches to the coupons that he Is non
,zable Then the bank will credit
bin with the full amount Of ~h'
coupons.
The taxable bondholder will file a
schedule with the government in
which he will deduct the amount of
the tax on his coupons which has
hcen withheld. so that he personally
viii pay only the tax on the remain
der Of his income less other exemp-
tions.
But II the taxable bondholder
does not identity himself by means
Of the siEned slips attached 10 tho
coupons, his claim OF exemption on
bond tax filed in his personal sched-
ule TO the government will not be-
allowed. for the reason that it will
not be possible to verify the truth
Of his statement from the reports of
the bond issuing corporation. So he
viii be doubly taxed on his bond in
come
II the non-taxable bondholder does
not identify himself by means OF the
signed slips. the bank will be COM
PEELED TO withhold the tax.
Tenants to Pay for Landlords.
A tenant paying rent OF more
than $4,000 or $4,000 year WIZ
withhold and transmit to the gov
ernment the tax thereon unless tn
landlord files with him an affidavi
that he is exempt Failure to m
such statements win require the ten
ant TO deduct the tax.
II the landlord Is a corporation
fhe tenants will not deduct the Ia
from their rent payments. for tn
corporation viii pay its tax on thi
income in paying the corporation
tax just as Il has for the last foul
years
n the lessee is a realty company
il Will withhold the tax from the
owner of the property and subiesses
viii not be required TO make a re-
turn thereon.
Corporations which have guaran-
teed their bonds exempt from tax
will be hard hit by the law. The
United States Steel Corporation. for
example. will be required TO pay tho
iaN On Andrew Carnegie's S30O.00,-
ooo Of bonds.