Evening star. [volume] (Washington, D.C.) 1854-1972, 1913-10-03


rations and joint stock companies. or as
sociations subject to like tax. who are re
quired to make and render return II
behalf of another. as provided herein u
the collector of his, her or Its district
are hereby authorized and required II
| deduct and withhold from such annua
gains, profits and income such sum a.
will he sufficient to pay the normal ia,
Imposed thereon by this section, and shai
pay to the officer of the United state!
government authorized to receive tn
same; and they are each hereby mads
personally liable for such tax.
Landlords to Make Returns.
Provided, That landlords are to make
their own returns, and tenants are eX
empt from the provisions of the fore
going requirements, except when in the
case of individuals trustees and other
non-corporate owners. the terms or the
lease require the tenant to pay state
and municipal taxes ana assessments
against the property the cost of main
tenance, repairs and insurance, in which
| case tenants are authorized and required
| to deduct the tax out of the gross rental
in the manner above prescribed. Where
| the owner is corporation the tenant
| shall not be required in any case to
deduct the tax upon the gross rental. the
| corporation itself being required to make
the return and the statement of the de-
duction.
Also:
Where under the terms of contract
| entered into before this act takes effect
| the payment to which the taxable person
| is entitled is required to be made without
any deduction by reason of any tax i'm
posed. the obligor shall not be compelled
to make such deduction or withhold the
income tax. but shall give notice to the
collector of the payment made, or to be
made. as a part of the return which he is
required to make. and the said sum shall
in that case. for the purposes of this act.
be computed a part of the income Of
the taxable person If the obligor fails
TO give such notice he shall be personally
liable for the income tax if the same is
not paid by the taxable person. No such
contract entered into after this act takes
effect shall be valid in regard TO any
federal income take imposed upon a per-
son liable to such payment.
interest payments on bonds, mort
cages, et-The normal tax of per cent
shall b. withheld regardless of the
amount of such interest paid.
Provided further. That the amount of
the normal tax hereinbefore imposed
shall be. deducted and withheld from
fixed and determinable annual gains,
profits and income derived from interest
upon bonds and mortgages. or deeds of
trust. or other obligations of corpora
tons, joint stock companies or associa-
lions, and insurance companies. whether
payable annually or at shorter or longer
amount to $1,000, subject to the provi-
sions of this section requiring the tax to
be withheld at the source and deducted
from annual income and paid to the gov
eminent. and likewise the amount OF
such tax shall be deducted and withheld
from coupons. checks or bills of exchange
for or In payment of interest upon bonds
or foreign countries and upon foreign
mortgages or like Obligations mot pay
able in the United States). and also from
coupons. checks or bills of exchange for
or in payment of any dividends upon the
stock or interest upon the obligations of
foreign corporations. associations and in
surance companies engaged in business in
foreign countries: and the tax in
each case shall be withheld and
deducted for and in behalf of any per-
son subject to the tax hereinbefore i'm
posed. although such interest dividends
or other compensation does not exceed
$1,000. by any banker or person who
shall sell or otherwise realize coupons.
checks or bills of exchange drawn or
made in payment of any such interest or
dividends mot payable in the United
States). and any person who shall obtain
payment mot in the United States) in
behalf of another of such dividends and
interest by means OF coupons, checks or
bills of exchange. and also any dealer
I'm such coupons who shall purchase the
same for any such dividends or interest
dnot payable in the United States). 9TH
erwise than from banker or another
dealer in such coupons: but in each case
the benefit of the exemption and the de-
duction allowable under this section may
be had by complying with the foregoing
provisions of this paragraph.
Licenses Required.
All persons, firms or corporations un-
dertaking as matter of business or for
profit the collection of foreign payments
by means of coupons, checks or bills of
exchange shall obtain a license from the
commissioner Of internal revenue and
shall be subject to such regulations en-
aiding the government to ascertain and
verify the due Withholding and payment
OF the income tax required to be with
held and paid as the commissioner of
internal revenue, with the approval of
the Secretary of the Treasury, shall pre-
scribe and any person who shall under
take to collect such payments as afore-
said without having obtained a license
therefor or without complying with such
regulations, shall be deemed guilty of
misdemeanor and for each offense be
fined In a sum not exceeding 5000, or
imprisoned for term not exceeding one
year. or both, in the discretion Of the
court
These sections only relate to the col
lection of the normal tax Il per cent?. 1t
will be noted that first, the law requires
that the amounts referred to shall be
person entitled to receive the same. and
1t is this feature Of the law which it is
desired shall be specifically called to the
attention of those affected thereby.
The law provides that those charged
with the duty of withholding this normal
tax upon the payments referred to shall
withhold it and pay 1T to the govern
ment. and if they shall fail to do so they
shall nevertheless be liable for the
amount of tax which should have been
withheld. The tax so withheld need not
be returned to the government until after
and further instructions "ill be issued in
due time and forms provided for making
returns of taxes so withheld.
Information for Taxpayers.
For the present it is only desired that
all persons. corporations. etc. shall be
made aware as far as possible of their
duties with respect to Withholding the
normal tax. The law does not specify in
what manner such taxes shall be with
held. and it would appear. therefore,
that persons. corporations. etc, charged
with the duty OF Withholding such tax
may adopt such means and plan Of pro-
.cedure as will be best adapted to their
particular business or manner of con-
Quoting the same.
This will be evident more particularly
in the case OF the deduction of the tax
upon salaries or other payments which
may be made weekly. monthly or quar-
tery. The law specifically provides that
no liability shall attach with respect to
the duty of withholding such tax for the
year 1913 prior to the passage OF the act
With respect to the licenses for per-
sons. firms or corporations undertaking