New-York tribune., 1919-01-20
Edwards Getting
Ready TO Collect
Huge Income Tax
Progress ON Bill in Congress
Sufficient to Warrant the
Printing of Forms for
This District, He Says

Without waiting for Congress to
pass the new revenue bill William Fl.
Edwards, Collector of Internal Revenue
II this district, said yesterday he was
gong ahead with preparation to
handle the largest income tax colec-
ton in the history of the country.
"The conferrees in Congress have
made sufficient progress on the BILL"
said Mr.. Edwards, "to warrant the
bureau in proceeding at once to print
and distribute the forms for the collec-
ton of the tax"
Mr.. Edwards issued statement for
information of taxpayers. He said:
Every unmarried person who earned
$1,000 or more during 1918 and every
married person who, together with
wife or husband, earned $4,000, should
sharpen his pencil and figure out how
he stands. He must ascertain ac-
curately his gross income from ell
sources There's his salary or wages,
including overtime pay and any bonus
received as additional compensation.
A married person having children un-
der eighteen who are working should
include the earnings of such children.
Gains Must Be Included
"1f he sold any property at a profit
the gain must be computed and in
cluded in gross income. If he rented
any property to other persons the
total rents received must be ascer-
tanned, and from that figure deduc-
ton may be taken for taxes paid, the
necessary minor repairs, fire insurance.
any interest he may have paid on mort
gage and a reasonable allowance for
annual wear and tear. The balance is
included in gross income for the year.
"lntercst on bank deposits, whether
withdrawn or added to his bank bal
ances, must be included in all calcula-
tions. Bond interest received during
the year must also be included, except
interest on municipal, county or state
bonds. Interest on United States
bonds need not be included by the
ordinary bond holders who purchased
small amounts. Holders of large
amounts of Liberty bonds, however,
my Office for the rule applying to tax
or such interest.
Everybody wants to know what in
come is exempt from tax. Very few
plums that fall to the average man
may be legally disregarded in figuring
up his 1918 income.
Gifts and Bequests Eliminated
Gifts and bequests can be elimi-
received by the beneficiary of an in
sured person. A person who cashed in
an endowment policy need report as
income only that portion which exceeds
the total of the premiums he paid in
all years on that policy. Dividends Of
policies must be considered income.
"Alimony is not income to the re-
cipient, nor is it an allowable deduc-
tion on the part of the person who
pays.
"From the total of all items of in
come there are certain deductions al
lowable by law. All interest paid on
personal Indebtedness and all taxes
paid during the year are deductible, ex-
cept Federal income and excess profits
taxes, inheritance taxes and assess
ments for local improvements, such as
sidewalks, sewers, etc. Losses incurred
in business or trade are allowable,
also losses arising from fires, storms,
shipwreck or other casualty, or from
theft, in cases where such losses are
not compensated for by insurance or
otherwise.
Losses incurred outside of a per-
sons regular business are allowable to
the extent of gains reported from
similar transactions within the year.
Debts due to the taxpayer actually as
certained to be worthless during the
year are deductible
"Depreciation on property used in
profession, in business, or in farming
is another item that may be claimed as
deduction. The theory of deprecia
tion in connection with the income
tax is that wear and tear caused by
use in earning income is real ex-
pense in the earning Of that income.
"Dividends on stock shares are in
i Lo al, IJoI
figures"