Evening journal., 1914-01-23
RULES ON
INCOME TAX.
If in $4,000 a Year Class Make
Complete. Report by
March !
WORK IS EASY
FOR SALARIED MEN


come of $4,000 per annum or more
you must make a return TO the Uni
ted States collector of internal rev
enue for your district. so he may as
sess the amount of tax to be paid un
der the income tax law.
You have until March / to file youi
statement. IL must be acknowledged
before notary public or other per.
son legally authorized to administer
oaths or affirmations.
Unless your income reaches $4,000
or $4,000 for the period from March
TO December 81 which this initial
{ return coVrs, you may live on ia
peace and make no statement. Hus.
band and wife living together need
make no return unless between them
they have an aggregate income of S4,-
900 year, or $3,333 for this starting
period. All others, unless President
Wilson or federal judges, must
make their returns and they must be
truthful.
II you fail to file your return by
March J, penalty of from $50 to ST.
600 may be imposed while the tax foi
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 at
tempt to cheat him. The law gives
him authority in such case to double
the tax collectable, to fine you up to
$4,000, and to jail you for not exceed
ing one year
Easy for Salaried Persons.
For the man or woman working
for salary, and saving no over in
come or profit, the income tax pre-
sents a very easy proposition. If an
individual and your income for the
ten months exceeds $2,50O. the nor
NAL tax of / per cent applies on the
amount over that. Thus If you have
$4,000. the tax would be on $500 or
s.. Married people are exempt as to
each couple up to 1888 for the per-
iod
Should you be the recipient OF an
income, whether from annuities, Sc
curities owned or other investments,
the amounts so received must be con
sidered 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
source, that is deducted from the
coupon or interest by the paying con-
cern, you report such income and
then deduct it from the gross amount,
so getting exemption in the tax
levied upon you direct
Where you have income from bonds
upon which the issuing company un-
dertook 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 method holds
as 10 income derived from dividends,
this for the reason that companies
having stocks are assessed on their
net income and pay dividends out
of what remains
In either of thees cases YOU are
exempt only for the normal tax of
1 per cent on incomes up TO $4,000
per annum. Where you have more
than that the sur tax applies. In
come from some other sources is
exempt. That from pensions is free
OF tax. So are the amounts re-
ceived in salaries by officers or en-
ployes of any state, city, county or
township. Mayor Blankenburg thus
has his salary free of tax. Income
tax from his life's savings Is subject
10 tax.
Covers Doctors and Lawyers Fees.
II YOU are a lawyer or doctor. you
must report as income all fees col
lected or earned during the period
and which YOU have charged and bill
ed for, even If the bills are yet un-
paid. Partnership earnings whether
divided or not, are income. and must
be returned. No debt owing can
be considered worthless and be de-
Quoted from income as a loss. un-
less and until IL has been actually
proved TO be such
Where such indebtedness Is included
a. income for the period and subse
quently proves t1 Dee uncOllectahlc. IL
can be- deducted from the income for
the subsequent period under the head ol
losses sustained. Costs OF suits arising
out of business or to collect debts may
bee counted As expense and deducted
FROM gross earnings.
No family or living expense can be
charged against income. Neither may
the householder claim credit for what
he might estimate his home could be
rented for. Where il is mortgaeed the
interest payment may be deducted from
the gross income IN getting to the net
amount taxable. the same is true OF
interest paid on borrowed money
Omit Paper Profits and Losses.
Under the law neither paper profits
nor losses are considered They must
be- realized in each case and applied
Thus increased value oi realty Is rot
considered as income or as profit to be
returned, unless the property shall be
sold or the increase value is credited
By the owner 10 his assets. Thus. ii
YOU have a property which cost $4,000
and You raise its value ON your books
to 81 600. the $1,000 becomes returnabe
income. exactly as il would be- profit
TO be- included in income had the prop
erty been sold for 81 900 and the profit
been realized.
This same principle applies as TO in
vestment securities or TO dealings in
bonds and ltoeks, cotton, grain or other
things. II you speculate in any of these
things, the same holds true. Say you
had certain stocks ON February % last
and still held them, whether owned
outright, or carried on margin. on Jan
uary I. In such case the dividends, if
any would be income, which, however.