Milford chronicle., 1914-02-06
RULES ON INCOME TAX

y Man or woman, If you have an income
of 50, 600 per annum or more, you must
make a return to the United States col
lector of internal revenue for your dis
trict, so he may assess the amount of
tax to be paid under the income tax law.
You have until March ! to file your
statement. 1t must be acknowledged
before a notary public or other person
legally authorized to administer oaths
or affrmations.
Unless your income reaches s., 600 or
81, 500 for the period from March to
December 81, which this initial return
covers. you may live on in peace and
make no statement. Husband and wife
living together need make no return un-
less between them they have an aggre-
gate income Of 1000 a year, or 50, 1873
for this starting period. All others, un-
less President Wilson or federal judges,
must make their returns and they must
be truthful.
| If you fail to file your return by March
l. penalty of from $50 to 81, 900 may
be imposed, while the tax for which you
are liable will be increased by one-half. /
| Should you make a false or fraudulent
return. then expect no mercy if Uncle
| Sam detects your attempt to cheat him. /
| The law gives him authority in such case
to double the tax collectable, to fine you
up to 81, 600, and to jail you for not ex-
| ceeding one year.
EASY FOR SALARIED PERSONS.
For the man or woman working for a |
salary, and saving no over income or /
profit, the income tax presents a very /
easy proposition. If an individual and /
your income for the ten months exceeds /
81, 500, the normal tax of 1 per cent ap-
plies on the amount over that. Thus if
you have 5000, the tax would be on
$500 or S.. Married people are exempt
as to each couple up to SO, 1888 for the
period.
Should you be the recipient of an in
come, whether from annuities, securi
ties owned or other investments, the
amounts so received must be considered
and returned, unless from government,
state, municipal, county or township /
obligations, the income from which is
tax exempt under the law.
When you are a bloated bondhOlder
and the tax is collected at the source.
that is deducted from the coupon or in
terest by the paying concern, you re-
port such income and then deduct it Z
from the gross amount, so getting ex-
emption in the tax levied upon you direct.
" uEAG IOu ndNE AAlEOllG lLOIn UOluA -
upon which the issuing company under y
took to pay all taxes assessed against :
the interest payment, such income must =
be reported, and then deducted as being =
exempt up to the normal tax. The same y
method holds as to income derived from =
this for the reason that COM
Danies having stocks are assessed on y
heir net Income and pay dividends out u
# what remains ~
In either of these cases you are ex-
impt only for the normal tax of l per y
ent on incomes up to $50, 900 per an Y
lum. Where you have more than that ~
he sur tax applies. Income from some 3
ther sources is exempt. That from pen
ions is free of tax. So are the amounts Fl
eceived in salaries by officers or en- n n
llOyes of any state, city, county or 81
ownship. Mayor Blankenburg thus has u u
is salary free of tax. Income tax from 1
lis life's savings is subject to tax. al d
OVERS DOCTORS AND LAWYERS FEES. N,
If you are a lawyer or doctor. you m
must report as income all fees collected fC
r earned during the period and which W
ou have charged and billed for, even az
the bills are yet unpaid. Partnership O
arnings, whether divided or not, are gC
lcome, and must be returned. No Ii,
ebt owing can be considered worthless al
nd be deducted from income as a loss dc
Mess and until it has been actually an
roved to be such. r,
Where such indebtedness is included at
S income for the period and subse- on
uently proves to be uncOllectable, it Nj
an be deducted from the income for
le subsequent period under the head -
: losses sustained. Cost of suits aris- II
g out of business or to collect debts
ay be counted as expense and deducted
-om gross earnings.
No family or living expense can be
larged against income. Neither may ch
lie household claim credit for what he ROT
light estimate his home could be rent thi
for. Where it is mortgaged the th'
terest payment may be deducted from fol
e gross income in getting to the net
mount taxable. The same is true of on
terest paid on borrowed money. wh
OMIT PAPER PROFITS AND LOSSES. 4e'
Under the law neither paper profits %, S''
II losses are considered. They must MI
realized in each case and applied NO,
lus, increased value of realty is not H.
as income or as profit to be ros
turned, unless the property shall be ~
Id or the increase value is credited by cIo
e owner to his assets. Thus, if you nv
We a property which cost $40, 600 and