The Tupelo journal., 1918-03-22
FEDERAL INCOME
TAX IN BRIEF
The Requirements Boiled Down
for Busy Folks.

II you were single and your yet n
come for 1917 was $1,000 or more you
must file q return.
If you we're married and living with
wife Cor %husband) and had a net In
come of $1,000 or nor for 1917 you
must file a return.
Husbands and wife's income must
be considered Jointly. plus income OF
minor children.
Income of a minor or incompetent,
derived from a separate estate. must
be reported by his legal representa-
tive.
Severe penalties are provided for
| those who neglect or evade the law.
For false or fraudulent return there
is a penalty not exceeding $1,000 ine
or years imprisonment, or both, l
100 per cent. of tax.
For failure to make return on or
before April 1. 1918, fine is from $50
to $1,000. plus so per cent. of a due.
Returns must be filed with the Col
lector Of Internal Revenue of district
In which you live.
An agent may file return for a per
son who is i'll, absent from the country
or otherwise i%ncapacitated.
Each return must be signed and
sworn or affirmed by person eXecut-
ing it.
SNgle persons are allowed $1,000
exemption in computing normal tax.
A married person living with wife
Cor %husband) is allowed $4,000 exemp-
child under Is.
A head of family. though single, is
allowed $4,000 exemption If actually
supporting one or more relatives.
Returns NUT show the entire
amoun Of earnings, gains and profits
received during the year.
Officials and employees are not taxa
BILE on the salaries or wages received
from a state, county. city or town in
the United States.
Interest on state and municipal
bonds issued within the q. S. is az
cIIDt HUH icuSiut tuNOLhC tdA diih
should be omitted.
Interest on United States govern
ment bonds is also exempt, except on
individual holdings Of Liberty FOurs in
excess of $1,000 par value.
Dividends are not subject to normal
in net income.
Gifts and legacies are not income
| and should not be included on the re
tu-n of the beneficiary.
Life insurance received as a bene-
fciary or as premiums paid back at
maturity or surrender of policy is not
income.
Payments received for real or per
sOnal property sold Is not income, but
the profit realized thereon is income
for the year of sale.
Amounts received IN payment of
the interest on such notes or mort
cages is taxable income.
From the entire gross income GER
tain allowances are made In arriving
at the net income.
Necessary expenses actually paid in
the conduct Of business. trade or pro
fession may be claimed.
A farmer can claim payments for
labor. seed. fertilizer. stock feed. re-
pairs on buildings. except his dwelling;
repairs of fences and farm machinery.
materials and small tools for immedi-
ate use.
The a,noun of rent paid for ii farm
may also be claimed as a tenant farm,
er's expense.
Payments for I've stock are allowa,
bile If bought for resale. But If bought
for breeding purposes cattle are an in
vestment, no an expense, and cannot
be allowed
A stOrekeeper can claim amounts
| paid for advertising. clerk hire. tele-
| phone, water, light and fuel. also dray
age and freight bills and cost of op-
Grating and repairing wagons and
| trucks.
A physician car claim cost OF his
professional supplies, rent. office help,
telephone. expense of team or automo-
bile used in making professional calls
| and expenses attending medical con
ventiOns.
A dentist car claim similar items.
except team or auto expense. which
are not necessary in his profession.
Expenses that are personal or con
nected in any way with the support or
we'll being of a person or family are
not allowable.
The costs Of machines, instruments.
vehicles or implements that are more
or less permanent in character are not
allowable as an expense. They are in
vestments.
Interest paid on a mortgage or other
personal indebtedness is allowable on
a personal return.
All taxes paid within the year can
| be taken out on a federal return, ex-
cept federal income taxes. inheritance
taxes and assessments for local i'm
provements.