The daily star-mirror. (Moscow, Idaho) 1911-1939, 1914-03-10
PLAIN TALK ON
INCOME TAX
NEW LAW EXPLAINED AS III IS
APPLICABLE TO THE
FARMER.
Tells What Expenses May be Deducted
From the Report in Making Re-
turns to the Collector.

turns to the Collector.
WASHINGTON Mar 10.-If a farmer
is SO fortunate as to have a net in
come of over $4,000 a year in case he
is bachelor, or $4,000 if married, he
is subject to the income tax, and un.
der the law each individual must make
return to the internal revenue collec-
tor of his district on or before the
first day of March if he has a net in
come of $4,000 or over ($2500 for the
ten months of 1919. While the inter
est of most farmers in this subject is
purely academic, the department OF
agriculture has received inquiries in.
dicating that some wish to know just
what is required of them under the
new law.
The income tax law of October 3
1913, places tax of l per cent upon
all net incomes of over $4,000, with an
additional tax on incomes of 5000
or more. The first question arising in
the minds of most people is what con-
ceiving a regular salary, or business
man with a good system of book
keeping, it is easy to determine wheth-
er or not his income is taxable. But
for the farmer who receives no stated
income, and who often fails to keep
accurate account of receipts and ex-
penditures, it is more difficult to cal
culate his net income.
Post the Farmers.
In order that farmers may be posted
on the income tax as it may concern
them, the following information has
been furnished by the internal revenue
bureau of the treasury department:
In general, an income consists of
amounts derived from salaries, wages,
or compensation for personal service,
paid in any form; also from profess
sions, business, sales or dealings in
or from rents, interest on
bonds or mortgages, dividends on
stocks, or other income from invest
ments. These items constitute gross |
income, from which there should be |
deducted the expenses of carrying on |
the business; interest paid on indebt-
edness; worthless debts charged off
losses by fire, storm or shipwreck, not
covered by insurance. exhaustion,
wear and tear of property, and any in
come upon which the income tax has
already been deducted at the source,
is, for instance, dividends On the stock
If corporation which has already
,aid the tax on it's earnings.
Entitled to Exemption.
The provisions regarding net in
ONES of $4,000 apply only to unmar
led persons, or to married persons not
living with wife or husband. A hus-
and and wife living together are en-
tiled to an exemption of $4,000 on their
ggregate income. This means that
4 case the wife has a separate in
ONE, if this added to the husbands
lcome amounts to $4,000 the total is
ubject to the tax; or, if the wife has j.,
0 separate income, the husbands in
ONE is taxable only in case it reaches
1000. But return must be made if
lie aggregate income of both is $4,000
II the year 1913. The joint exemp-
on, however, would be $3,33333.
In arriving at his net income the II
rmer should start with his gross in.
ome. This would consist of any U
ems of the kind above enumerated,
Id especially all receipts from the d
lie of products of every description .
ON the farm. This would include
| money received for produce and d
limals sold, and for the wool and IS
DIES of animals slaughtered, if the ~
Dol and hides are sold; but he may III
duct from these items the amounts II
tually paid as purchase money for u
e animals sold or slaughtered during e
e year. When the animals raised by III
e owner are sold or slaughtered, VI
wever, their value should not be oe
Quoted. 81