The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-03-05
INCOME TAX IDIOClES.
4 Little Corporation sprsNir a18 - Pay
~ ILLEGAL Requirement.

To THE EDITOR OF THE SuN--Sfr. Just
as q bit OF corr oborative evidence to the
interesting story in yesterday Sun IN
regard to collection at the source, permit
me to submit some data.
A little gas company had $4,000 inter-
est to pay on December 1. 1913. on $780,
900 of bonds which were issued tax
free" After all the certificates and cou-
pons came In the treasurer found he had
to deduct and withhold the tax on $3.50
worth of coupons, all the rest being sc-
companied by certificates claiming exemp-
ton. SO Uncle Sam was entitled to Sl.50
tax. There 10 no reason to expect any
material difference In the next batch of
coupons. due June I. 20 that the total
amount Of this collection at source VIII
be about 81 year.
That isn't much to pay. and perhaps the
treasurer might be forgiven for feeling
Of secret Joy over the scanty reward to
the Government for the trouble to which
he had been put. But when he did lit
tie thinking and figuring he got real peev.
ish about II.
In the arss place he had 70 All out and
swear to Form 1919 In duplicate. which
meant q double notary fee. u. A month
later, when he forwarded . belated GER
tincate he learned to his disgust that he
was expected To nle Form 1919 again.
and that II must be sworn TO In duplicate
a. before. although there was nothing to
state on the form but mo coupons re-
ceived." In short, II appears under the
regulations adopted BY the Treasury De-
partment that the treasurer OF this little
company must make twelve reports on
Form 1919. each In duplicate. during the
year. with q nnai annual report on Form
1918. which merely summarizes all the
monthly reports 10 that for the privi-
lego Of paying the Government a tax OF
% the company must pay S13 year In
notary fees. to say nothing OF the time
and labor involved In examining and list
Ing certificates. &c
Incidentally. the treasurer must also
hand over to the collector all the GER
tincates. whether exempt" or not though
the law Ii clear In stating that all with
holders'' Of the tar at the source shall
make . return "of the portion Of the In
come Of each person from which the nor
mai tax has been thus withheld" For
the present the Treasury Department era.
ciously permits the exempt certificates TO
be turned over without requiring them to
be listed on any form. but II would be
mighty careless for any treasurer to fall
to keep Q complete list nevertheless
As all the above matters were taken
up direct with the commissioner At Wash
ington. and attention was called to the
iileeal!ty Of the requirement to make
monthly reports when the Law requires
only an annual. and the requirement to
file exempt certificates when the law re-
quires returns only for incomes on which
the tax 10 withheld there can be no
question Of confusion on the part OF col
iectors nor OF Misunderstanding on the
part OF the Treasury Department. II Is
lust a plain case OF the Government try.
ing to distribute the burden Of liz work
over the year At the expense OF the corpo-
rat'ons. and incidentally ascsrtaining
where all corporate bonds are held. To
he sure the latter information II useless
At the present time but II might come In
very handy when the next step In income
taxation IL taken. that IT, cutting down
the limit OF exemption.
THE SuN's article lays a good deal OF
stress on the heavy work and expense In
r'cted On larpe and wealthy corporations
Granted But think the treasurer OF the
small country corporation needs your
sympathy and powerful Aid \ SIGHT more
The actual money cost IN his case NAV
no compa -ntve'v small. hut he must do
all the work and carry all the worry and
responsibility alone.
W. n. LAYTON
WAYNR. pa March q