The Alaska daily empire., 1918-03-11
INCOME TAX PRIMER FOR
 BUSY PEOPLE
(Continued)

l Cuit Ol a Dhoi CAOA0Ol III a DhiAuAA6 and loan association subject to in come tax?
 Any amount credited to a share holder when the title to such credit
 passes to the latter at the time of the credit has a taxable status for the normal and additional income tax and should be included in the return rendered for the year during which the credit is made.
 Where the amount of accumula- able to the shareholder until the maturity of a share it need not be reported as income, but upon matur- ity of the share the amount received in excess of the total amount actual 1 ly paid in by the shareholder is to 1 be returned.
 | 47. l hold stock in corporation which in 1917 increased its capital and gave me the right to subscribe for addition stock at par. If I sell returned for tax purposes?
 Yes; the entire proceeds from tie sale of right" to purchase addi- tional stock should be included in the return rendered for the year l during which the sale Is made anl will be subject to both the normal and additional tax.
 48. Are payments of alimony to be returned for tax purposes by their | recipient?
 | to the recipient, nor is it held to | be such an item as is allowable as | a deduction to the person paying the same
 49. Where service is rendered for | a stipulated price, wage, or salary and paid with something other than money shall consideration be given the transaction for income tax pur poses?
 Yes; the stipulated value of the value at which the thing taken in payment is to be considered, and the amount of that value is to be report cd as income.
 Where there is no stipulation as to the value of the service, and pay | ment therefor is made with some thing other than money, the fair mar ket value of the thing taken in pay ment is the amount to be returned as income.
 Dividends | 30. The net earnings of a corpora tion in which I held stock in the year 1916 amounted to $50,000, which | amount was carried to surplus ac count. It's net earnings from Jan uary to December 31, 1917. amount 1 cd to s70,o80, and on this latter date these last earnings were carried to surplus and cash dividend of 1 $5o.000 declared and soon thereafter l paid. What income taxes are to be assessed against this dividend? 1 Section 32 (b) of the Act of Sep. tember 8. 1916, as amended by the l war revenue act, provides. in part, as follows:
 Any distribution made to the share. | holders or members of corporation. l joint-stock company or association. or | insurance company. in the year 1917, | or subsequent tax years. shall be deemed to have been made from the most recently accumulated undivided | profits or surplus, and shall consti. ute a part of the annual income of the distributee at the rates pre- scribed by law for the years in which such profits or surplus were accumulated by the corporation, joint stock company or association, or in- surance company.
 Therefore, the dividend to which you refer is to be charged against the most recently accumulated earn. ings or surplus; that is. against the S70,000 earned during 1917 and car rted to surplus on the day the dtvi- dend was declared, and it will be sub iect to the additional tax at the rates prescribed by the act of Sep tember s. 1916. and also. at the rates prescribed by the war revenue act of October 3. 1917
 5l, Suppose that instead of de- claring a dividend of $50.000. this corporation had declared a dividend of S100.0O0?
 If such had been the case. the entire amount of net earnings car ried to surplus on December 31, 1917. would have been subject to addition al tax at the same rates as the divi- dend mentioned in your inquiry. next above, and the balance. or $30,000. would have been held to have been paid from the 1916 earnings and would have been subject to addition al tax only at the rates prescribed in the act of September 8. 1916. 1 52. Assuming that instead of pay ing this dividend, in cash corpora tion had capitalized the same amount of surplus as was distributed In cash, or $100.o00. and issued the aew stock to its shareholders as