Evening star., 1914-02-04
INCOME AXLAW'S
TERMS EXPLAINED
When Tenants of Office Build
ings Must Act as With
holding Agents.
AGENTS OF FOREIGNERS
TO MAKE THE RETURNS
Personal and Family Expenses Are
Not to Be Deducted From
the Gross Incomes.


flee building. leases the rooms to tenants
for term of years at a liked rental. pay
able monthly. Does each tenant have to
act as Withholding agent: How can
tenant. if liable. learn about the land
lords exemptions. etc?
Answer. Each tenant would not have
to act as a Withholding agent unless his
yearly rental was more than 5000 for
his rooms. If it was he would have to
withhold per cent of the yearly rent
which he paid, provided he did not have
filed with him an exemption form The
answer to the second question is that he
does not have to know about the owners
exemptions. etc. but must hold out the
tax unless the owner files with him one
OF the exemption forms d0O7 or 1903.
Must Enter Gross Income.
No. 2a-Question. \ owns several
houses from which he receives rents. The
rents are collected and all the repairs
and expenses are paid by the agent
Should he enter the net income which he
receives from the agent in his return or
should he enter the gross income and in
clude the repairs and expenses in his de-
duction?
Answer He should enter the gross in
come in his return and under the head
ing of general deductions include the re-
pairs and expenses.
No. 30-Question. How is beneficiary
going to tell on what amount the TAX
has been paid of the income wh:ch ne
receives from trustee or admin
-Strator?
Answer. 1t is his duty to lind out
from the trustee or administrator Or
the trustee or administrator should
when he pays the income, lncioSe d
statement showing the amount on which
the tax has been paid and that on which
it has not
No 31-Question. Does foreigner
not living in this country, but having
property here. from which he receives a
taxable income, make a return?
Returns Made by Agent.
Answer. The foreigner himself does
not have to make a return. but the agent
who is managing his p roperty must take
return for him. The only source of
income OF a foreigner which the regula-
tions exempt is the interest items of
American corporations. The law says
that tax shall be paid annually upon
the entire ne. income from all property
owned. and every business. trade or pro-
fession carried on in the United States
by persons residing elsewhere. On page
. of the regulations it exempts m
terest on bonds, mortgages, equipments,
trusts. receivers certificates and other
similar obi cations of corporations. To
take advantage of this exemption al
lowed foreigners on interest items Of
corporations, they should file with them
form No. 1904.
No. 32-Question. Does a partnership
have to make a return?
Answer. y partnership does not have
to make d return unless requested to
do so by the commissioner of internal
revenue or the collector of internal
revenue of that district. Each partner
includes his share of the net earnings
of the partnership in his own return.
a place is found on page of the per
soma return form. subdivision I. Part
nership profits have to be included in
the partners personal returns even
though the profits are not divided. and
then when they are divided they are
included, but as that INCOME on which
provided for partnerships to be filed
with in come of partnerships from cou-
pons and interest on other similar OBJ
legations owned by the partnership.
The Withholding agent will not with
hold any tax when accompanied by
this certificate These certificates may
be signed in the firms name by one
of the partners or they may be signed
by all the partners.
For Fraternal Organizations.
No 33-Question. What certificate
should be used by fraternal organiza-
tionsr
Answer. Certificate No. 10O1 should
be filed with interest items of such or
ganizations, and then the Withholding
agent will not withhold any tax.
No 34-Question. Can ownership GER
tificates be signed by duly authorized
agents Of persons?
Answer. Yet. duly authorized agents
can sign for their principals. provided
they give the name and address of
both agent and principal. and provided
they have the right to such authority
certified to by some bank.
No ::-Question. \ is out of the
country. and has a taxable income and
is represented here by an agent who
handles all his affairs. can the agent
make the return for him?
Answer. The agent can make the re-
turn for the person. provided he signs
the oath provided for such purposes.
No. :W-Question. Are personal ex-
penses allowed to. be deducted for the
gross income?
Answer. The law says that all ex-
penses necessary in carrying on "A busi-
ness may. but that no partnership. per
sonal. living or family expenses can be
deducted.