The Birmingham age-herald., 1913-11-14

In interpretations and regulations which
have come from the washington authori-
ties. But there are other difficulties be-
yond, and apart from those which are
oecasioned by the seeming trouble which
those In authority in the treasury de-
partment are having in working out con-
slstent and easily understood rules and
regulations
1t seems to be the common opinion
among lawyers that 1t is the wiser part
to advise the corporations to be careful
IN the preparation of their income tax
blanks so that instead of reporting paper
income, so-called. they will be able to
report nothing but actual and perfectly
oefensable cash incomes.
For this reason many of the managers
of corporations have been advised by the
lawyers to write off machinery, plants.
equipment and other like articles repre-
sentlng the investment of fixed capital.
The lawyers say the machinery as soon
as it is installed becomes inert, dead, or
at least moribund, for it Is constantly
depreciating. Therefore the only safe way
for the managers of coportions who pre-
pare income tax blanks is to write off
all property of this kind.
Another point upon which the lawyers
have advised such of their clients as are
corporations is that 1t will probably be
inexpedient to protest against the col
lection of income taxes as agents of the
government. Much complaint has been
heard from bankers and from others be-
cause under the law they are required to
collect and turn over to the government
income taxes upon certain kinds of prop
erty which represent a part of the busi-
ness of banks or other corporations. 1t
has been asserted that the government
has no constitutional right to compel a
bank, or any other corporation or even
individual to be quail income tax collec-
tor
A Police or Excise Regulation
There seems to be a general opinion
held by competent counsel in this city
that protests of this kind will be unavail-
ing. The lawyers believe that If a case
should be made up and carried to the
supreme court in which the issues were
on the part of the government that 1t has
undoubted rights to compel banks and
other corporations to act as their tax col
lectors, while on the part of the cor
porations there is denial of this right,
the supreme court would decide that a
proceeding Of this kind is clearly within
the law because it Is a part OF the regu-
lations which the government has an
undoubted right to make for the collec-
ton of taxes.
In several cases state courts have de-
cided that tax collection of this kind
comes within the power of the state to
establish police or excise regulations.
Therefore it is surmised that the supreme
court would decide that a regulation
which compelled, for instance, a bank to
collect an income tax for the govern
ment in nothing more than an excise or
police regulation which the government
has undoubted right to make use of.
Curio.rc Eoracacf
Some of the counsel are inclined to the
opinion that within few years the rate
OF tax imposed by an income tax law will
be considerably increased. They do not
think that the limit of exemption of $4,000,
or in some cases, $4,000 will ever be made
smaller. But they of the opinion that
when it is discovered how great an amount
of money can be raised by levying a rel
atively small income tax, then Congress