Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1914-01-15

an income of $500: for instance,
So, 900 representing dividends from
stock of corporations liable to tax.
such individual will be required to
make a return of annual net income.
A fiduciary making return for his
beneficiary will be guided by the
same rules as applied to the in
dividual himself.
Q.-Are corporations allowed a spe-
cific exemption of $4,000 under the in
come tax law, as they were under the
corporation excise tax law?
A-No. Corporations are taxed
under the income tax law on their
net earnings for the full calendar
year. January 1 to December 81, both
inclusive The income tax law dates
from March I: however, special ex-
else tax has been reenacted for the
months of January and February,
1913. for which period the net income
shall be ascertained in the same man.
ner as 1t shall be ascertained for the
income tax for the balance Of the
year.
Q.-When is interest accrued?
A.-Accrued interest is to be con-
sidered interest due and payable, ex-
cept in cases Of banking or other in
situations which close their accounts
on the basis of interest earned.
Q.-Ten years ago bought a manu-,
featuring plant. sold it in July,
1913, at gain OF $4,000. What part
of this is income subject to the in
come tax?
A.-The gain of such transaction
should be apportioned during the
time such investment is carried as an
asset The difference between the
original cost, to which may be added
the cost of upkeep, and the price re-
ceived upon sale, is held to be the net
income derived therefrom The
amount expended in repairs neces-
sary to preserve the property is
proper deduction from the income
committing net income, but repairs
such as are in the nature of addi-
lions, or which increase the perman-
ent value of property, are considered
betterments, and are not allowable
deductions.
Q-What should a debtor do with
the ownership certificates which
have been attached to the coupons
of his obligations, both those on
which the tax has been withheld, anu
those claiming exemption?
A.-Debtors or withholding agents
are required to make monthly list
return on blanks furnished by the
Of all coupons or interest
payments on which the normal tax
of 1 per cent was deducted, and al
certificates Of ownership shall be for
Warded by the debtor to the collector
Of internal revenue of his district, on
or before the twentieth day Of the
month succeeding that in which said
certificates of ownership were re-
ceived by him or it.
Q.-Must returns be sworn to-?
Ayes.
o. spent considerable money last
fall putting thing in my farm, and
putting up new fences. l also re-
placed board floor in my barn with
a cement floor. Am I permitted to
deduct the cost Of these items?
A.-No; they are Of the nature of
giving increased value
to the farm and as such denote
profit. In deducting expenses for re-
pairs on farm property the amount
deducted must not exceed the amount
actually expended for such repairs
during the year for which the return
is made. The cdst of repairing tools
or machinery is / deductible expense
TO the extent thaM the cost of the new
articles does not AeXceed the value Of.
the old.
Q.-Are interest," coupons. due be-