New-York tribune., 1919-02-25

Information is withheld.
Write on one side of paper only
lnclose stamped addressed envelope
for reply in case questions are not an
swered in the column.
Address all correspondence to
Tax Service Department. Tribune
Business News Bureau, 154 Nassau
Street, New York City.
Question: am single man, living
in a boarding house. the sole support
of my mother, who resides with her
married sister.
Am l entitled to $4,000 exemption
as head of a family, since my mother
does not live in my househoid"?
Answer: Since your mother does not
live in your household you are not
entitled TO $4,000 exemption as head
of a family. This answer is based on
present Treasury regulations, which
are subject to change.
Question: We are a family Of nine,
two boys, myself and younger
brother, now in the army, and seven
sisters, all of us single. 3
The oldest sister takaa entire charge
of the household. She is without indie
pendent income. The earning members
of the family are: Myself and one
Of $1,000 a year; two other sisters,
neither OF whom earns that amount.
The brother in the army pays in $50
month toward the support of the house
hold.
ictn al
under age, two attending school, but the
other stiJl being under school age.
Will you be good enough to tell me
how our income tax return should be
figured out. Would TIE family income
be added altogether and $4,000 sub
stracted, as in the case OF married
man, and 5000 exemption be claimed
for each of the dependent children, or
would the sister, whose income is in
excess of $1,000 and myself each pay
on the excess over that sum, and if so
would there be. any allowance for the
minor children, who are entirely de-
pendent upon Us for support?
Answer: You are the head of a
family, and thus entitled to a personal
exemption of $4,000. You may also
for each sister under eighteen years
of age or incapable of self-support be-
cause mentally or physically defecti ;,
Your sister who earns an income in
excess of $1,000 should file a separate
return. No returns will be accessory
in the case of the sisters whose in
comes are less than $1,000. The amount
paid by the brother in the army toward
the support of the household would be
treated as a gift and hence not sub
Ject to income tax.
Question: Will you kindly inform
me through your paper or direct in
regard to Liberty bonds. I have some
Ct the second, third and fourth issues.
What amounts are exempt from the
normal taX also are they to be added
to surtax? Do I understand correctly
exempt flom all tax?
Answer: All interest received from
the flrst issue of Liberty bonds is en-
OF the fourth issue is exempt from
tax tor teriod ending two years after
the term nation of the war Also. il,
terest received after January l. 1913.
on an aggregate amount of the bonds
OF the first, second and third issues
cqua to one and one-half times d..
principal of the fourth issue originally
subscribed for and held at the date Of
the tax return, but not in excess of
700, is exempt from tax for pc
rlod ending two years after the end of
the war. In addition to the $4,000
exemption, as stated above, income
from an amount in the aggregate of
$4,000 of principal of the second. third
and fourth issues is exempt from tax
for the life of the bonds. 1t is also
possible to convert bonds of the first
issue to the amount of $4,000 into the
fourth issue, and hold such converted
bonds exempt from income tax for
period terminating two years after the
end of the war.
| presume you are aware that all
interest received from Liberty bonds
is exempt from the normal income
tax
Question: I sold ny stock during the
month of December, 1913, which I
bought twenty-five years ago and on
which | sustained q severe ;oss. Some
of these stocks purchased later at
higher figures. May I deduct such
loss which ! sustain ned from my income
tax account?
Answer: Losses sustained in stock
transactions under the circumstances
which you mention are allcwable de-
ductions.
For the purpose of determining the
amount of loss In such transactions
the basis shall be for property ac-
quired prior to March ], 1913, the fair
market value as Of that date.
Question: (a) | am in receipt month
~ from wealthy relative of a sum
which is purely a gift Is this tax-
able income? '''N
(b) | pay annually considerable
this deductible?
Answer: (a) Amounts received as
gifts do not constitute taxable income.
(b) No.