Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1918-01-16
INCOME BLANKS
RECEIVED HERE
Forms To Be Used In Making Out Re.
turns Under Tax Law Received
From Washington.
CALL AT OFFICE TO GET THEM
Inspector Explains That Only Taxes
Paid Can Be Deducted From Tx
pense on Homes.

Blank forms to be used in making
returns under the income tax law
have been received by C. r. Manning
and are now available at the local
revenue Office in the postoftice build
ing.
Only two packages Of blanks have
been received thus far and those de-
string them will have to call at the
Office. Later when more are received,
blanks will be sent to factories ana
other large business establishments.
The blanks were delayed enroute by
the blizzard.
Mr.. Manning has received numerous
queries as to the amount that can be
exempted on homestead. Many are
under the impression the alterations
repairs and other expenditures on
their homes can Re deducted. This Is
wrong. Only the taxes paid on the
home can be subtracted from the net
income.
Amended is list of questions and
answers to clear up all cases with re-
gard to minor children, interest on
liberty bonds, life insurance policies,
workmen's compensation act and cou-
pom bopds:
Question: have two children liv-
ing at home; both are regularly en-
ployed One is II years old and the
other q. Am l required to include
the amount Of income which accrues
to each during calendar year in my
own personal return?
Answer-As the first child has not
reached it's majority and is still legal
" under your control, the amount of
its income is to be included in your
personal return and is subject to tax
in your hands. The income of the child
which has attained it's majority is not
TO BE included in your return and is
only subject to tax in the hands of
that child.
Question: I include in my per-
sonal return the amount of interest l
receive on Liberty loan bonds, or is
that interest exempt from tax?
Answer-All interest derived from
the Liberty loan 3k per cent bonds is
sued under the act of April a. 1917, is
exempt from both the normal and ad-
ditional income tax Interest derived
from the Liberty loan per sent bond
issued under the act of Sept. "a, 1907,
is exempt from the normal income tax,
but so much of the interest as is de-
rived from such bonds the principal of
which exceeds $4,000 is subject to the
additional income tax That is If you
hold $4,000 of Liberty bonds at 4 per
cent the interest from $4,000 or 5000,
is exempt from tax. and the balance
of the interest. or $3.50, is subject to
the additional tax.
On Life Insurance.
Question: held an endowment life
insurance policy upon which I paid
premiums for 20 years In 1917 that
contract matured and l received its
face value or $1,000. Must l return
the entire amount received?
AnswT-Return only the difference
between the aggregate amount Of the
premium paid and the amount re-
ceived upon maturity of contract.
Question-A man who is the EN-
ploye of corporation was injured and
under the laws Of the state in which
the accident occurred he received
$4,000 on account of the injury he suf-
fered Must the amount thus re-
ceived be counted as income?
Answer-Any amount received I'M
der the employers liability act and
the workmen's compensation act or
any ether similar act, or as the re-
salt of settlement or compromise
for pain and suffering" is held to be
such income as is subject to the fed
e-al income tax. This ruling is also
aDplicable to any amount received I'M
Ce~ the terms of an accident insurance
policy.
Question: purchased a per cent
500 coupon bond at its face value
plus $3.50, that is. three months &C
crued interest. Three months later
detached a coupon therefrom and col
lected SO interest. Must the entire
amount of interest received be re-
turned as income?
Answer-No. Report only such in
terest as accrued after the date OF
your purchase. 1t is the sellers duty
to report the balance.