The Pensacola journal. (Pensacola, Fla.) 1898-1985, 1917-10-07
HOW MUCH WAR TAX WILL
YOU PAY? READ AND FIGURE TT

In order to enable them to make
these calculations without calling in q
lawyer or wading through the intrica-
cies of the $50 page revenue bill. the
following simple analysis of the war
profits and income taxes has been pre-
pared, with the assistance of Wash
ingtons leading tax experts:
The Income Tax.
WHO MUST PAY? Every unrnar-
ried man, woman or child with a net
income from wages, profits, interest,
rent or any other source exceeding
1000 for the calendar year 1917,
and every married person with a net
income exceeding $4,000.
RETURNS MUST BE MADE I'M
der oath on or before March 1, 1918
by every person with an income ex-
ceeding the amounts named above,
even if there is no tax due, under
penalty of $40 to $1,000 for failure.
HOW TO CALCULATE NET IN
COME. Net income, upon which the
tax is levied, is calculated by taking
the total amount of money received
by the individual during the year
from all sources ana deducting from
that amount the following items:
Necessary expenses actually paid in
carrying on any business or trade.
but not including personal, living or
family expenses.
All interest paid within the year
on Indebtedness, except interest on
loans made for tie purchase of tax
EXEMPT securities.
All taxes, local, state and federal,
except income and war profits taxes
Losses actually sustained during
the year in business or trade or from
fires, storms, theft, etc.
Debts ascertained to be worthless
and actually charged off.
Reasonable allowance for wear and
tear of property employed in bust
hess.
Contributions for religious. chart
tafle, scientific or educational pur-
poses to an amount not in excess of
Is per cent of the net income without
the benefit of this paragraph.
EXEMPTIONS. Unmarried per-
sons have $1,000 exempt from in
come tax; married persons have
$4,000 exempt and in addition 5000
exempt for each dependent child I'M
der Is years of age.
TAX RATES. The. taxes levied
upon incomes are composite result
of four separate sets of taxes. the
normal" tax rates in the old reve-
rue bill and the new, and the super
tax" rates in the old bill and the
new. For example. under the old law
there was a norma tax of per cent
on all incor,e of unmarried persons
over $4,000, the new bill adds a new
normal tax of 2 per cent and lowers
the exemption to 81 900; under the
old II supertaxes started with 500
600, end these supertaxes still stand.
but there have been added new super
taxes beginning with $4,000. The re-
suit is very confusing.
In order to bring all the existing
rates into simple form, / have COM
bined them in a single table which
shows for each separate class of in
come, the total tax rate that will be
levied upon it. The method of using
the table best be explained by a SIM
pie example:
If you are married, with no chill
dren, and have an income of $4,000.
YOU will pay no tax on $4,000 which
is exempt under the law. On the
$4,000 falling into the tax group
S2,O00-S4 900 you viii pay 2 per cent
or $40; on the $1,000 falling in the
tax. group $4,000 S. 900, you will pay
per cent, or $40; on the 1000 fall
ing in the tax group SIS 5000 sc 900,
You VIII pay D per cent, OF @oo, HAN
ing a total income tax of $50.
If you have two children under Is
years, you have an. exemption of 5000
for each. so that you would pay no
tax on S2,400; 2 per cent on 81 900 be-
tween your $4,000 exemption and
$4,000; 4 per cent on 1000 between
$4,000 and $4,000; 3 per cent on 81 900
between $4,000 and $4,000, making
total tax of S122.
COMBINED NORMAL AND. sU-
NEW BILLS-Note: Rates shown APP