New-York tribune., 1919-03-06
Morris F. Frev.

leading authority on tho subject, .oiH
0nsaoer questions submitted to him
through this department relating to IN
da0ldnab corporation or partnership in
come tares, or about aoar profits and
e1cess profits td1es.
loN may therefore tell uour tor
troubles to ThI Tribune acith tie nssur-
once that they riN receive expert corr
saderataon. Those questions sch,ch are
OF general interest aciU be ansaueTed in
thss column. Names qoiU rot DC used.
Au other questions aOiU be Gmswcred by
mail. All communications wiU be re-
garded as highly confidential.
You ViU fdvor as and expedite the
reply # you aciu please observe these
requests:
State your questions as concisely as
possible, but be sure that no essential
information is withheld
Write on one side of paper only.
nclose stamped addressed envelope
for reply in case questions are not an
s~ered in the colamn.
Address all correspondence 10
lax Service Department. Tribune
BUSINESS News Bureau, 154 Nassau
Street, New York City.
Question. paid s1,5OO last June
for 1917 taxes. Am I permitted to de-
Duct that amount as an expense of
1918.
2. Am [ allowed to deduct from 1918
moneys loaned in the past five years
which | know l will never get back
because one who borrowed died and
the other went in bankruptcy?
Answer. Assuming that you refer
to Federal income taxes, the amount
paid is not deductible.
Z. Such amounts are deductible as
bad debts, provided they are ascer-
tanned to be worthless in 1918.
Question am a married man with
two children under eighteen years Of
age. My salary during 1918 was $4,000.
My wife is teaching public school
and boarding with our two children in
another city from where am employed
and board Our Joint salaries are used
in paying our expenses. Must her sal
airy be added to my income or am T
entitled to S2,400 exemption without
her salary?
Should | include her salary as in
come and then claim exemption for
shat amount plus S2,4O0?
separated from your wife. Such being
the case, you are not subject to income
tax, since your wife's salary is not
taxable under the present law Your
wifc's salary is exempt from tax. If
you are not separated from your wife
you are entitled to a personal exemp-
ton of $4,000, and if you support your
two children to an additional exemp-
tion of $500 for each child.
Question: During the year 1918 at
intervals I speculated in stocks on the
New York Stock Exchange, making some
profits and some losses On January l,
1919, I owned stocks bought on specu-
laton in 1918. In making up my in
come statement for 1918, how shall I
treat those particular deals put
value on said stocks owned January !,
1919. and bought in 1918, at their clos
ing prices December 81, 1918, or how, if
otherwise
Answer: In the case of stocks and
bonds which have been purchased and
not sold, TO profits or losses should be
reported unless you are a dealer in Sc
curities.
Question: A friend of mine has S.
900 of the second AZ per cent Liberty
Loan. $4,000 of the third 4A per cent
Liberty Loan and $4,000 Of the fourth
4A Liberty Loan. Does he have to pay
tax on the above $4,000 in bonds
that is. the income received from them?
His salary, | know, is taxable.
Answer: / presume that your friend
was an original subscriber to the Lib
erty bonds of the fourth issue, which
he still holds. Such being the case, in
terest on all of the bonds above men
toned is exempt from tax.