The Washington herald., 1913-10-04
Orders Sent FOR COLLECTION
Of CUSTOMS AND Income TAX
Commissioner Osborn In
structs as to Securing Sums
Due at Source.
IS FIRST OFFICIAL MOVE
Applies to Persons or Corporations
Paying to Individuals Periodical
Amount of Over $1,000 Yearly.

The first official move in the admins
tration of the new tariff law came yes
terday, when Commissioner of Internal
Revenue Osborn, who has charge of the
collection of the income tax, sent to col
lectors of internal revenue throughout
the country instructions as to the prOVi-
sions of the new law relative to the col
lection of the income tax at the source.
These instructions apply to all persons,
corpora tons, and business concerns
which pay out to individuals a regular
periodical amount in eXess OF 5000 a
year. Under the law such persons and
corporations are obliged to withhold the
tax, and If they fail to do so are them
selves liable for the amount.
After quoting the provisions of the
income tax law in regard TO withhold
ing the tax at the source. the Internal
Revenue Commissioner says:
These sections only relate to the COL
lection Of the normal tax q per cent?. 1t
will he noted that, first, the law re-
luires that the amounts referred to shall
be withheld from the payment made to
the person entitled to receive the same,
and it is this feature OF the law which
Il is decided shall be specifically called
to the attention Of those affected thereby.
May Wait Until End of Year.
The law provides that those charged
with the duty of withholding this normal
tax upon the payments referred to shall
withhold it and pay it to the govern
ment. and if they shall fail to do so.
they shall nevertheless he liable for the
amount Of tax which should have been
withheld The tax 50 withheld need not
he returned to the government until after
tho close of the current calendar year,
and further instructions will be issued
iE due time and forms provided for
making returns Of taxes so withheld.
For the present il is only desired that
all persons. corporations. &c. shall he
made aware rs far as possible Of their
duties with respect to Withholding the
normal tax. The law does not specify
~ what manner such taxes shall be with
held. aud il would appear. therefore.
that persons. corporations &c. charged
vFth the duty Of Withholding such tax
may adopt SuCn means and plan OF pro-
,edure a. will be best adaD,ed to their
particular business or manner Of con-
duCtinC th,. same. This will be evident
THOre particularly in tho case Of the de-
ductiun Of the tax upon salaries or
other payments which may be made
" eckly. monthly. or quarterly The law
specifically provides that no liability shall
.ttaCh with respect to the duty Of with
toding such tax for the year 1918 prior
Il the Passage Of the act.
Matter Of Licenses.
with respect to the licenses for per-
sons, firms. or corporal tiOns undertaking
sS a matter of business or for profit the
ullectiun II foreign interest payments BY
means Of coupons, checks. or ills nf
exchange. YOU are informed that Ueces-
saTily such licenses and the regulations
,feTred to in the law cannot be pre-
Jared prior to the passage OF the law
Therefore. all persons desiring to OBJ
tain such licenses shall max" applCa-
tiCn L. the collector Of int, rnal reve-
rue for such licenses. rnEist, ring their
names and addresses and statInE the ma
ture of the business in which they are
"ugased. and IN" licenses will be issued
o them as SooI, as the same "an be pre-
Dared after the passage Of the act. Such
application will BE- considered a sufficient
compliance. with the law until the Ii
.enseS and regulations referred to in the
law can he prepared and issued. The
regulations 10 which such dealers shall
he subject will also be issued at the
earliest possible date.