The sun., 1919-02-23

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in fact income from all sources except
| that which is specifically exempt
| Proceeds of life insurance policies
paid to the beneficiarles on the death
| of the insured and the return premium,
the value of property acquired by gift
\ or bequest. the interest upon the obliga-
! lions Of State or political subdivision
thereof. that is, interest upon municipal
| or State bonds; the interest on Liberty
| bonds, that Is. for the 1040A without
any qualification. the Liberty bond In
terest up to $1,000, and the amount
received by an individual from State or
| municipalities, that Is, State and munic-
| ipal salary are free from tax.
Salaries received during the present
war by individuals In the military or
naval service of the United States up
to $500 are exempt. The bill states
| that the military or naval forces of the
United States shall include the Marine
| Corps. the Coast Guard, the army and
navy nurse corps. female as we'll as
| male, and the enumeration of these par
| ticular branches OF the army and navy
| forces shall not be deemed to exclude
| other units which may be included in
such. The only thing We can say at
| present is that the civilian employee OF
| the War Department will undoubtedly
| be excluded from that specific exemp-
ton.
| Taxes for local benefits. for improve
ments which the whole community does
| not share in, cannot be deducted.
| Worthless Debts Deducted.
Worthless debts may be deducted, but
\ In allowing them the department must
be convinced that they are worthless
and charged off the books. The mere
fact that they are charged or does not
make them liable to the deduction unless
the taxpayer can establish that they are
worthless.
Depreciation OF property IL arrived at
| by determining the length of life as near
as possible of a piece Of property and
| dividing 100 per cent by it's estimated
life and allowing the resulting figure as
| depreciation. The department has allowed
| In thousand of cases a certain deprecia-
| ton that is taken as an arbitrary rate,
For instance, the life of a brick build
ing. as there is nothing to the contrary.
may be estimated at fifty years, and 3
per cent,-10O divided by so. is the de-
probation allowed. Depreciation up to
per cent. will be allowed without Ques-
ton In making up the return. If a tax
payer claims more than per cent. de-
probation the onus Is upon him to show
| that the life of the building, because
Of peculiar conditions, is not fifty years.
| II the life of a building is 100 years
| ! per cent. is allowed.
Because of a comparatively recent STU
prenle Court decision the depreciation
! on property shall be based upon its value
as of March !. 1918, and II acquired
subsequent to March l. 1913, on its
cost This decision says that If the
property was acquired prior to March
l. the value on March ]. 1913, will be
! the initial cost Of the property, less de-
probation TO March ], 1918. unless sat
isfactory evidence is produced by the
| taxpayer to show that it is not correct.
on wooden tenements a maximum of
| per cent. is allowed On furniture and
| fixtures In no case Is more than 10 per
cent. allowed. On passenger automobiles
used for business 20 per cent. Is al
lowed-that liz to say, physicians car
or car used by n man in his business.
How to Figure Repairs.
Wherever repairs are of such ma
ture as to add to tine life OF a building
or of any property, il cannot be de-
Quoted as repairs, but should be capt.
talized and these improvements should
be deprecated. Wherever the repairs
are of an incidental nature and do not
add to the life or improve the property
rs a whole. these repairs can be taken
~ addition to degradation.
wish to inform the public again
that payments this year may be made In
four instruments. Where a man has
tax under SO he will avoid trouble to
himself and to the Government IL he
will pay this tax when he files his re-
turn before March 15. The taxpayer
will also greatly aid the Government and
himself II when he makes that return
on the first page the name and address
are legible. Where the taxpayer signs II
and his oath is taken on the back he can
put down what hieroglyphics he wants
Capitalize every single letter OF your
name and also the address. OF course,
Il 1t is typewriter it will be easier to
handle. The public can appreciate the
immense amount Of time and money
which Is lost because of an error at the
start. His correspondence goes astray,
IT is fled In the wrong place and the
taxpayer becomes incensed, even though
1t is his fault in writing his name in
distinctly.
II may take five or ten seconds or
half a minute to see that the front page
OF the return is made out in the man
ner indicated and every question an
swered, but that time may save work
and lots of time later when that return
gets into the mill and Is started through
the department
With the enormous percentage of re-
turns carrying a small amount OF tax on
the 1040A we can get that immense
flood OF returns in and out OF the way
before the smaller number. the returns
that carry the heavy tax. come In.
Place of Return.
As last year, the return should he |
made in the district In which the indi- |
vidual has his principal place of bust T,
ness or his legal residence. When maxi
ing sup his return the taxpayer has the !
option OF making It where his legal resi- |
dence Is or where he has his place OF |
business It will help greatly Il he files
his return in the same office as he filed ,
last year.
II man should file a return on
March Is and does not accompany II
with a payment he cannot take advan-
tage OF instalment payments, but must
pay the full amount OF the tax when he
receives his bill
The liability to make a return is gov
erned by the joint income OF husband
and wife II man should receive a |
salary OF $500 and his wife has a $3.50
or $500 income, there Is liability TO a
return-that is to say. after he has
taken the deduction and credits which
the bill allows him.