Norwich bulletin., 1917-10-25

1 tPRO6l EMS ARISING THHOO0u -i TAE NEW TAX LAW. Iaxpaysrs Must Obtain siants from 1 Intsrnais Revenue offisers. | The problem of collecting taxes l yielded by the new revenue law offers possibilities of some difficulties, ac- who has just returned from confer ence with Com missioner of Internal Revenue Daniel C. Roper in Washing ton. The conference was attended by col- lectOrs from all parts of the country. The problem faced by the collectors involves the collection of the speciel tax levied by the law, and the regular taxes also. It will be necessary to en- large the clerical staffs in principal collection districts. and some effort will be necessary to collect from unin- Istructed or recaicitrant taxpayers A list of taxes showing just what every corporation and individual will be re- quired to pay s in process of prepara- tion, and exp1ana tfons will be made or certain phases of the new law that are difficult of understanding. Collector William H. Edwards of the Wall street district is preparing in formation of general value relating to the tax and says that the law requires all persons making payments to others of $500 or over shall report the same
 
 they are located. This will enable the government to check up all those who do not pay their debts to the govern |ment- It will be impossible, it is ex- pIained for the different collectors to forward blanks tc taxpayers at large, who are to file returns, a s the lists today in the various offices contain only names of the persons who re- 19I6
 It will therefore be the duty of the taxpayer to obtain blanks at the of- ices of the internal revenue where he resides or his principal place of busi- ness at least by the latter part of De- cember. Collectors gre already antici- pating a tremendous number of forms required by the thousands of new tax rayers. The collector makes the fol- lowing explanations to those who have rot hitherto been required to make re- turns:
 A single person earning $1,000 a year will not be required to pay tax, but will be required to file return; that out and file it with the collector. A tax will only be collected on what you earn over the ,$1,000.
 This same rule applies to married people living together or heads of fam flies receiving $2,000 a year. Unless such married people living together have an income in excess of $2,O00 tax will not be collected, but a return must be filed.
 A simple illuStration is given as fol- lows: Single pefson--Net income, $5.a 900; exemption. $1,o00: $4.o00 taxable income income at t per cent is g sSGi H"G Married ton, s2,o00; 8 900 taxable income at per cent. is s60 tax.
 Married persons who are separated are, only entitled to, under the new law, the $1,000 exemption. the same as T single person, and s3,000 exemption under the old law
 In addition to the above. which is the war income tax, the income tax under the act of Sept. 8, 1916, will be levied.
 The new war income tax and the income tax under the act of Sept 8, 1916. should be figured separately.
 For the benefit of taxpayers I have taken into consideration the follow ing questions asked of this office, and the answers may be helpful:
 Q.-What tax would a single person be required to pay receiving an income of sl;75o year? AmThe A ood exemption t would be per cent. tax on $750, namely sf5. However, if the income exceeded $3,000 there would be an ad- an amount in excess of $3,000.
 Q--What tax would a married per son be required to pay receiving an income of $3,000 a year? A.-There would be an exemption allowed of $2,-
 
 the additional $1.000, or $20. However, if the income exceeded "A 1000 there would be an additional income tax of per cent. on an amount in excess of $1 900.
 Q.-When does the income tax law go into effect? When is the tax pay able? A.-The law is in effect as of Jan. 1, 1917, and returns should be calendar year of 1917, the returns be- ing required to be filed on or before March 1, 1918. and the tax paid on Or before June 15, 1918, for the year 1917.
 Q.-Are losses in securities deduct ible under the law? A.-Losses in cured in trade are proper deductions. However, any transac ctions entered into for profit but not connected with trade or business, the losses actually sus tained may only be charged off to an rived Curing the year.
 Q.-What are the penalties imposed by the law for failure to file return within the required time? A.-Fifty ffc penalty of from s20 to $1 900.
 Collector Edwards pointed out that no return can be made to the govern ment except the one furnished by the form should be filled out at the tax payers leisure sworn to by a nofficer with a seal. The return should show the income received during the year 1917, following instructions printed on the form.
 Playing Card Tax.
 The internal revenue bureau has regulations in regard to the tax imposed by the new revenue law on playing cards. Every pack must pay a tax of cents, in addition to the tax of cents imposed by the revenue law of 1916. The new reglts- tions follow:
 Taxation of Dividends.
 Dividends paid from amounts set aside by corporations to cover depre ation and depletion are held by the internal revenue bureau to be taxable for the purposes of the income tax. The decision says:
 Referring to the practice of certain of declaring dividends out of reserve set aside to meet deprecia- ton and depletion of property, and of advising stockholders that such diYi-