Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1914-02-10
As To The Income Tax
By Charles B. Kaufm ann Of the Davenport Bar
Copyright 1914 by Charles B. Kaufman.

L Definition.
Z The federal income tax law, which
was part of the tariff act, passed Oct.
s, 1918, is a tax on the net returns
from ones business, labor and capital
invested.
Income Taxable.
The net incom, not the gross, Is alone
taxable. The net income means the
deduction OF the necessary expenses
actually paid in carrying on any bust
ness plus certain other deductions
hereinafter stated from the gross In
come. But 1t does not include personal,
living or family expenses
What Net Income 10.
Income must be distinguished from
the value of the property inteslf; in
other words, income is the yearly profit
accruing to person from weges, divi-
dends, property or whatever other
source. Hence, property acquired by
gift, bequest, devise or descent or the
profits from life insurance policies in
whatever form are not income and are
not subject to the income tax as such;
we must distinguish between the value
of that which is acquired and the in
come of that which we own. Conse-
quently, the income tax applies to the
profit arising from gift, bequest and
the like, but not to the value OF the
thing itsef acquired.
Those Subject to the Income Tax.
Persons. All citizens, whether resid
ing at home or abroad, and aliens are
taxable upon their net income. Non
resident aliens are taxable upon their
n~t1, II,
the United States or from carrying on
any business trade or profession In
this country.
Corporations-The net income from
all corporations, joint stock companies
or associations (not partnerships) and
Insurance companies are subject to
the federal income tax. and it makes
no difference whether it is foreign or
domestic corporation. The income of
states, cities, towns, counties or any
political sub division is rot taxable,
nor are associations which are oper-
ated exclusively for the mutual benefit
Of their members. If they come under
the following heads:
Mutual savings banks, not having a
capital stock and not represented by
shares; providing for the payment OF
life, sick, accident or other benefits to
the members Thereof and dependent on
such members. operating under the
lodge system: agricultural or horticul-
tliral organizations, not for the pur-
pose of gaining income therefrom but
for the purpose of promoting the in
terests of agricultural and horticultural
pursuits; labor organizations, which
are not operated for profit nor for any
income except such as may be con-
tiibuted by the members for the gem
eral expenses of the organization and
which are formed for the purpose of
improving the general conditions of
those engaged in labor or for the bet
terment of their social conditions: do
nestle building and loan associations
not loaning funds to non members:
cemetery companies organized and OPP
Grated exclusively for the mutual ben
eft Of the members and which are not
stock companies for the benefit of he
stockholders: religious and charitable
organ!za lions. such as chuches. hospi-
tails and missions; scientific and ed
ucational association, If no part Of the
net income inures to the benefit OF
any private stakeholder or individual;
business leagues, chambers of COM