The Lynden tribune. [volume] (Lynden, Wash.) 1908-current, 1919-01-23
ASKS LYNDEN PEOPLE TO GET
INCOME STATEMENTS READY

is now under way. and every prepar-
alton is being made to handle the
largest collection in the history of
Income Tax. II am not waiting for
the final passage Of the new Reve-
nue. bill by Congress-" said Collector
David J. Williams today. nor for
the new regulation and blank forms
to be used. To get this big tax in
and get it accurate and complete, l
urge that we all begin now"
"The income tax obligations i'm
posed by the old laws, as we'll as the
measure now in Congress-, consist of
two distinct operations. One is, to
file return or statement of all items
of income and items of deductions
allowable by law, and TO do this with
in the period named in the law. The
other is. to pay the tax, IL any is due.
''Aii signs indicate that the income
tax this year will reach nearly every
working man and woman, and nearly
every merchant. shop keeper and far
mer. Not all will have to pay the tax,
but nearly all will be obliged to make
sworn statement Of the years in
come.
II am therefore advising every
n ioI vy1Vn pnod 000
or over during the year 1918, and
every married person, who together
with wife or husband, earned $4,000,
to sharpen his pencil and figure out
how he stands.
"A farmer must figure up all in
come derived from the sale or ex-
change Of products during the year,
whether such produce was raised on
the farm or purchased and resold.
He is allowed to deduct from this to-
tai his expense of the year connect
ed with the planting, cultivation,
harvesting and marketing of the crop,
or the care, feeding and marketing of
livestock. He is not allowed to de-
duet the amount expended in 1918 in
purchasing stock for resale; but
when such stock is sold its cost is to
be deducted from sale price in ascer-
tanning the gain to be included in
his return of income. The cost price
Of stock bought prior to 1917 can
not be deducted as in the case just
cited, If such cost was included In
the deduction made in the year of
purchase.
1.-THE farmer is not required to
include in his income tax cOmputa-
tion the value of farm produce con-
sumed by himself and family. But
in cases where he exchanges produce
for merchandise. groceries. ETC., the
market value of the articles received
in exchange must be included.
"All other items of income are ex-
empt from tax. Very few plums that
fall to the average man may be le-
gally disregarded in figuring up his
1918 income. Gifts and bequests
can be eliminated; also proceeds OF
life insurance received by the bene-
ficiary of an insured person. A per-
son 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. Annuities are not
taxable, unless the person received
in the year payments which repre-
sent, when added to all prior pay
ments on the annuity, an amount
greater than the original cost OF the
annuity. Dividends on unexpired life
insurance policies are not taxable in
come, but dividends on paid-up pol
icies must be considered income. AL
imony is not income to the recipient,
nor is it an allowable deduction on
the part of the person who pays.
From the total of all items OF in
come, there are certain deductions
allowable by law. All interest paid
on personal Indebtedness and all tax
es paid during the year are deduct
ible, except Federal Income and Elk
cess Profits taxes, inheritance taxes
! and assessments for local improve