New Ulm review. (New Ulm, Brown County, Minn.) 1892-1961, 1918-02-27
QUESTIONS ON TAX
RETURNS ANSWERED
tContinued from Page ~

amended, to hne Oh not TO exceed
$4,000, or to one years imprisonment,
or both, in the discretion OF the court,
and to the costs of prosecution.
May a husband and wife, living
soeether, and each receiving an i'm
dependent income, render separate
returns?
YES If the husband and wife each
receive, an independent income equal
6ar in excess of $1,000, separate returns
may be rendered. If, however, the IN
aome of either is less than 81 1000 but
eheir combined income equals or exceeds
$4,000, ajoint return should be rendered.
If a husbandSand wife render
Joint return, is the additional tax
assessed against that return based
upon the aggregate amount OF m
some shown?
NO.. The normal income tax Will be
assessed against the aggregate amount
repsrt ed by the husband and wife whether
ssint Or separate returns are rendered,
BUT the additional income taxes are
aznfy assessed against the separate in
come of each.
What is meant by the term met
Income?
For the pupose of determining whether
ST not a personal income tax return
should be rendered, net income means
YOUR total gross income less the ex-
ssnaptions specified in the answer to the
eighteenth question and the general
deductions specified in the answer to
She ffty-eight question.
In rendering a return what items
of income must l report under
gross income?
Under gross income should be reported
every item of income derived from any
;-a1rce whatever actually received during
the calendar year for which the re-
5,Isn is rendered, whether received IN
aash Or the equivalent Of cash, in
Guiding:
(a) All amounts of salary, wages,
commissions, or compensation OF what
ever kind, received for personal service,
including professional fees.
% All amounts Of gain, profit, or
income derived from business, trade,
commerce, OF from any sale OF property,
zeal, personal, or mixed. The method
Of ascertaining the amount OF gain or
profit derived from sale is outlined IN
She answer to another question.
(cl Rents, interest on notes, mort
cages, deeds of trust, or other securities
Ssued by individuals, partnerships, etc.,
interest on bonds, mortgages, deeds OF
arust, or other similar obligations OF
corporations, joint-stock companies, as
sE5atians, or insurance companies, and
interest on bank deposits.
Ut All income received from fidu-
iariss II that is, amounts received from
incomes of estates, trusts, etc., through
trustees, administrators, or executors.
CgH FL yau have an interest in part
eTershfa YOU should report your dlstrlb-
tive share Of the earnings or profits OF
the partnership ascertaining during the
calendar year for which the return is
rendered, whether distributed to you
or not; that is, of the fiscal year of the
partnership and on December 81 of
that year your distributive share of its
earnings or profits ascertained upon the
dnse of the books on December 81 should
H.: r4turned. If the partnership ends
IS fiscal year on some day during the
calendar year your distributive share of
Is earnings Or profits ascertalned at
I'll at time should be reported.
20 All items of foreign income -
si1at Is, intere;t upon bonds and mort
cages or deeds Of trust Of other sim lar
obligations issued by individuals who are
nix ELS OF TCSluGlllS vi ~ C1S1l W. lAIi lCo,
70 egn corporations, jo:nt-stock CON-
mnies. etc.
g., Royalties from mines, oil and gas
Fens, patents, copyrights, franchises,
d. other leyalized privileges.
th} Dividends on stock or from the
act earnings of domestic corporations,
ioint-stock companies, associations, or
Insurance companies, whether paid in
CASH. stock, or script. AS TIE net
a.srdSngs Of corporations, joint-stock
.aO,tsnTnINeS, &C., are subject to the tax
mposea upon the net ircome of corpo-
rat IONS, dividends from such net earn
ngs are not subject to the normal in
esome tax in the hands of the shareholders
Eeceiving the same, but they are to be
returned for the additional tax purposes
and are subject to that tax. The rates
of tax to be assessed against dividend
received during the year 1917, or any
subsequent year, are covered by the
answer to another question.
NJ an employer agrees to pay an
employee a certain stipulated salary
and furnish him with room and
Board, are the latter items to be con-
sidered ia computing income tax
iabilityz !.
Yes. A fair. rental value is to- be
placed upon the room and fair value
apegn the meals furnished, and Their
asnanays. reported as income by the
employee: If the services of the en-
pIeyee: are. used in the employers bust
ness, or trade, the latte: may claim the
rent paid by him for the room, if any,
and the actual cost Of the meals so
furnished as deduction under the head
of Business expenses"
Us a married man entitled to a
personal exemption of $4,000, and
$500 additional exemption on &C
count of two dependent children,
whose total net income does not ex-
reed $1,000, but does equal or exceed
$4,000, required to render return?
Yes. While he will not be required
10 pay an income tax, he is required to
Gender return if his net income equals
T exceeds $4,000. ~
What is meant by the term ''Head
2H a family?
Treasury Decision 2427 states that a