Evening star. [volume] (Washington, D.C.) 1854-1972, 1917-07-01
BY I. A. FLEMING.

The following communication has
business man. and. being of general in
terest in SO far as the questions and
suggestions made bear upon the in
tangible tax law, upon which returns
must be made as Of today. Is given
publicity.
"As a reader Of The Star l should like
to ask several questions. some OF which
are suggested by one Of your recent
articles. These questions can be an
swered at your leisure in your column
in The Star.
referring to the District of Column
bia Intangible taxes. What report Will
people make on checks in their posses.
sion, particularly local checks. July =!
II the holder has not cashed them. or
they have not been collected. they
would seem not to be liable Tor taxa
ton, for. II the drawers pay tax on
their balances July ], the same money
would be taxed twice.
IF the stocks Of local concerns are
not subject to the intangible tax. are
the dividends received from them by
local stockholders subject to the tax
on money?
Local concerns, as the public utilities.
I Judge will not be compelled to pay
tax on their cash and money in bank
There must be about a hundred thou
sand bank accounts subject to check IN
tho way from a few cents to good
many thousand dollars. 1t would APP
pear that it would hardly pay the col
lector to go after all Of these bank &C
counts. as some OF them probably would ,ha
cost of collecting the tax. l suppose
the collector will apply the rule OF
reason The tax on bank accounts
seems quite stiff, for with money on
deposit at 2 per cent it will take about
o{obf interest to paw the tax.
Further for example. in the case OF
the 4 per cent bonds Of the Washing
ton Railway and Electric Company VIII
the company pay the District intangible
tax or will the owner OF the bond have
to pay It? The company pays the nor
NAL income tax on these bonds, l un-
derstand. l judge that the interest on
the bond is also subject to the tax on
money"
Lowers are said to differ very ma
terially on some Of the propositions
submitted in the above communication.
Some claim that the intangible tax
amendment does not specify date
upon which the tax schedule must be
based. The assessor of the District,
however, says July /, and the fact that
1t comes on Sunday should make no
difference in the date of scheduling.
The question Of the treatment of
funds in transit is very important
There are thousands of checks in the
mails in the local post Office bearing
even date that will not reach the payee
until July 2: probably 100000 in inter-
est on deposits have been placed to the
credit of owners of bank accounts, as of
July 1, on books of banks and trust
companies, and have not been entered
on the books as yet.
May Require Ruling.
This suggests a possible ruling with
regards to these payments. for certain
Nv the credits are as of July /, but me
numerous dividend and interest checks
payable July l will not be in payee's
hands until Monday. July 2. The prob
lem is interesting
In the case of checks in hand I'M
cashed it would seem to be the square
way of doing to wait few days after
the first of the month and then prepare
schedule. as there will then be no
question in the matter.
The safe way in scheduling interest
on deposits as credit, would be to Sc
cure a statement Of balance as at the
opening of business July 2. which really
would be at the close of business July
/, when the date does not fall on Sun
and other negotiable paper of uncertain
value.
The treatment Of mortgages and notes
of hand provides that their specific
amounts must be entered at face value.
even though there may be deprecia-
ton or delay in the final settlement.
Stocks of local corporations are ex
"in lieu of all personal taxes"
Dividends on stocks are not exempt
The tax collector will probably put
the law OF reason into effect in making
assessments on inconsequential bank
accounts. but the intangible tax law it