The Leon reporter. (Leon, Iowa) 1887-1930, 1918-01-17
Interesting Points Concerning Com
DleX Income Tax Law.

The act of October 3 is retroactive
in SO far as the entire calendar veal
OF 1917 is concerned.
Every person paying $500 veal
or more to another must make a re
port of such payment to the interna
revenue collector.
Gross income must be scheduled
Gross income includes salaries
wages and gains from professions
\ vacations, business, trade, and com
mercial gains and profits from sales
in or growing out OF ownership q
compensation for personal services;
income from interest, rent, ,divi-
dends, securities, transactions OF any
business carried on for gain or
profit, gains, profits, and, in fact, In
come derived from any source what
ever.
Excluded in Gross Income.
Exclude in reporting gross in
Proceeds of life assurances paid
upon the death of the insured. /,
Premium returned to the insured
under life endowment, annuity con-
tracts.
beQuest, descent, but, the income
from such property shall be included
as income.
Interest on the obligations a state
and Of the United States, after Sept;
/, 1917, only if and to the. extent
provided in the act authorizing the
issue thereof. The first issue of
Liberty bonds carries only the in
heritance tax, and the. second Liber--
ty loan bonds carry the surtax and
up to the income on $4,000 bonds,
other laws then regulating the sur
tax.
Must Not be Scheduled:
Obligations of any possession OF
the United States must not be sched-
uled.
Farm loan securities issued under
the act of July II, 1896, are tax
free.
Income is to be reported on the
basis of actual receipts and disburse-
ments. A promissory note accepted
in payment of an obligation is treat
Easter offerings and fees received
by clergymen for funerals. mar
rfages, baptisms, masses, etc., are re-
garded as income.
Christmas gifts are not regarded
as income However, bonuses given
as stimulant to energetic, future
services have been held to be tax
able as income.
Based on Cost Price.
The act of Sept. 8, 1915, provides:
.For the purpose of ascertaining
other disposition Of property, real,
personal, or mixed. acquired before
March /, 1913 the fair market price
or value shall be based as ct March
/, 1913, and this value shall be the
basis for determining the amount of
such gain derived. After March l,
1913, on all propefty sold traded,
etr., gafHa to be based on cost
price"
: Where property that has been &C
auired by gift, descent, devise, or be-
quest is subsequently sold at price
greater than the appraised value at
the time the property was. acqulred,
the fair market value. at that date. is
the basis for computing the gain,
which is taxable.
No Account of Fluctuations.
No account is taken for the pur-
poses of the income tax OF tluctqa-
tons in market value or book valu-
es of securities or other property,
completed transaction on the basis
of price consideration.
In speculative operations one can
show losses on completed trades, but
not in excess of winnings.
The cost Of improvement made, by
b LcuduL do pal pay III " ~
to be added to rent as income OF the
landlord
Partnerships as such are not re-
quired to make income tax returns,
except when requested. but each
partner shall report his share OF the
profits therein. whether distributed
or not.
Same laws relate to nonreporting
Of interest on obligations held OF
any state or govern ment bonds other
than the second Liberty. As.
Mast Report Dividends.
The ISdla IT, snv ero fha from
a GrS md s earned by the partnership
under proper title on official blank.
1t is obligatory on the part OF the
individual to obtain forms for re-
turns of income tax.
If a taxpayers income is deter
mined at some tim e. during, the calen,
is to be rerorted in the individuals
return for the calendar year ending
Dec. 81 of the same year.
Answer these Questions.
Here are three questions which
each person should be able TO an
sswer:
Am / required to render.
personal income tax return for the
year 1917?
come for that year equals or exceeds
81 1000. If you are married no re-
turn is required unless your net in
come, including thai Of your hus-
band or wife, equals or exceeds
$1,000.
II you act as the guardian of a
minor or incompetent person, or as
the administrator, executor, or trus-
tee of an estate or trpst a return
behalf of your ward, or the estate or
trust for which you act, if the con-
ditions outlined under the head OF
"Fiduciaries" as requiring return,
are present in your case.
2.-When may my 1917 return
be filed with collector OF internal
3 on any day after Dec. 81, 1917,
but not later than March l. 1913.
3.-Will failure to file my return
within the time prescribed nv law
render me liable to any penalty?
Yes. You will be liable tt. q spe-
cific penalty of not less than $50 nor