Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1919-01-23
TAX HITS
MANY THIS YEAR
Single Men Getting $1,000 Year.
ly and Married Men Getting
$4,000 Must Make Returns

Portsmouth. N. H., Jan. 1s.-"The big
income tax drive of 1919 is now under
way, and every preparation is being made
to handle the largest collection in the
history of the income tax" 1T am not
waiting for the final passage of the rev.
enue bill by Congress-" says Collector
Seth w. Jones'" nor for the new regua-
tions and blank forms to be issued To
get this tax in and get 1t accurate and
complete. / urge that we all begin now"
THE income tab obligations imposed by
the old laws. as well as the measure now
in Congress. consist of two distinct opera
tions. One is, to file return or statement
oil all items of income and items of de-
auctions allowable by law, and to do this
within the period in the law. The other
Is, to pay the tax, IL any Is due.
when the new bill is enacted Into law.
1 will have the proper forms distributed
throughout the district and everybody
will be informed of the date when sworn
return must be filed. 1t Is my plan
| to send my men out to central locations
and to have them travel through the dis
! trict, aiding taxpayers in the preparation
| of the returns and in deciding doubtful
| points.
"All signs indicate that the income tax
| this year will reach nearly every work.
! ing man and woman, and nearly every
merchant. shop-keeper and farmer. Not
| all will have to pay the tax. but nearly
! all will be obliged to make a sworn state
, ment of the years income. / am there
fore advising every person who earned
| $1,000 or over during the year 1913 to
sharpen out his pencil and figure out how
| he stands.
EARNINGS OF CHILDREN
"He must ascertain accurately his
| gross income from all sources. There Is
his salary or wages, including overtime
| pay and any bonus received as additional
compensation. A married person having
| children under 18 who are working
should include the earnings of such chill
| dren.
'If he sold any property at a profit,
| the gain must be computed and included
in gross income. If he rented any prop
erty to other persons. the total rents
| received in the year must be ascertained,
! and from the figure deduction may be
| taken for taxes paid on rented property.
the necessary minor repairs, fire insur-
ance. any interest he may have paid on
| mortgage, and a reasonable allowance
for annual wear and tear Of the rented
|
gross income for the year.
Interest on bank deposits. whether
withdrawn or added to his bank balances,
must be included in all calculations Of
income. Bond interest received during
the year must also be included, except
where interest on municipal, county or
State bonds. Interests on United States
bonds need not be included by the ordi-
nary bond holder who purchased small
amounts. Holders Of large amounts of
Liberty bonds, however, should ask their
bankers to write to my office for the
rule applying to tax on such interest.
Dividends on stock shares are income,
and must be included in the gross fig
ures. although the law does not impose
the normal tax on distributions made by
domestic corporations.
"a person buying and selling merchan
disc must find his profits for the year
on the following basis: First, ascertain
the gross sales or total cash receipts
Then add together the inventory at the
beginning of the year and the purchases
of goods for resale. From this latter sum
subtract the inventory Of goods on hand
at the years end, and the result is the
cost Of goods sold. This cost. plus neces.
sary expenses incurred solely through
conduct Of the business, Is to be deduct.
ed from the gross sales. and the result
is the net earnings of the business.
"A professional man arrives at his pro-
fessional income by ascertaining the tota
of fees for services and deducting there.
from all expenses connected directly ant
solely with his practice.
"A farmer must figure up all income
derived from the sale or exchange o.
products during the year, whether sucf
produce was raised on the farm or pur
chased and resold. He is allowed to de
duct from this total his expenses Of thu
year connected with the planting. cult
; walton. harvesting and marketing Of thu
crop, or the care, feeding and marketing
of livestock. He is not allowed to deduc
the amount expended In 1918 in purchas
ing stock for resale; but when sucl
! stock is sold it's cost is to be deducted
from sale price In ascertaining the gall
: to be included in his return Of income
The cost price of stock bought prior t,
> 1917 cannot be deducted as In the cas-
= just cited, II such cost was included II
the deduction made in the year of pur
= chase.
THE farmer is not required to includ
in his income tax computation the valu
, OF farm produce consumed by himself ant
. family. But In cases where he exchange
produce for merchandise. groceries, etc
the market value Of the articles receive
:, in exchange must be recorded.
"All other items of income arising dur
=. ing the year through personal service
= business or trade, through use Of prop
erty or money. should be added into tn
=. gains for 1913
q Everybody wants to know what in
come Is exempt from tax. Very fe,
4 plums that fall to the average man ma
be legally disregarded In figuring up hi
1918 income. Gifts and requests can b
J. eliminated; also proceeds Of life insur
~ ance received by the beneficiary of a
n insured person. person who cashe
ia In an endowment policy need report a
, income only that portion which exceed
r. the total of the premiums he paid in a
~ years on that policy. Annuities are nc
taxable, unless the person received
q the year payments which represent, whe
n added to all prior payments on the annu
ity. an amount greater than the origns
N cost or the annuity Dividends on unex
a. pired life insurance policies are not tar
10 able income; but dividends on paid-u
+ policies must be considered income. All
mony Is not income to the recipient, nc
N is 1t an allowable deduction on the PAL
4 OF the person who pays.
Ia From the total Of all items of In
a. come. there are certain deductions al
= lowable by law All interest paid O
a, personal indebtedness and all take
- paid during the year are deductible, ex
20 cept federal income and excess profit