Imperial Valley press., 1919-03-01
DETAILS ABOUT
INCOME TAX TOLD

Mr.. Bachelor, was your net income
for 1918 $1,000 or more?
Mr.. Bendict, was your net income
for 1918 $4,000 or more.
( If so, you are required to file an
| income tax return with the collec-
tor of internal revenue for the dis
trict in which you live on or before
1 March Is.
Congress has carefully differenti-
ated between the persons who "fails"
and the person who "wllfully refuses"
to make return and pay the tax
within the time specified by the new
revenue bill. Delinquents of the
first class are subject, to fine Of not
more than $1,000. Those of the sec
ond class are subject to a mine of
not more than $4,000, or imprison-
ing a fraudulent return the penalty
ment for one year, or both. For MAX
ing a false return the penalty
is a fine of not more than $4,000
Imprisonment for one year, or both,
and an additional assessment of so
per cent of the amount of tax exad-
ed.
For failing to make the return on
time. in addition to the $1,000 fine,
there is an assessment of 25 per cent
of the amount of tax due.
Taxes may be paid in full at the
time cf making the return, or in
four installments, the first of which
is due on or before March Is, the
second on or before June Is, the third
on or before September Is and the
fourth on or before December Is.
If any installment is not paid when
4 due, the entire amount becomes due
/ ten days after demand therefor by
the collector. For failing to pay the
B tax when due there is apenalty of
\ per cent of the amount unpaid, plus
4 interest at the rate of l per cent per
! month during the time which it re-
I mains unpaid.
The new revenue bill, as it affects
individuals, differs materially from
the War Revenue Act of October 3
1877, and preceding acts. Probably
I the most important change is the
rate, the exemptions of 81 900 for
single persons and $4,000 for married
Z persons and heads OF families remain
ing the same as under the 1917 act
The normal rate of tax under the
new act is 6 per cent on the first
$4,000 Of net income above the ex-
enptions, and II per cent on the re-
naming net income. This applies to
citizens and residents of the United
Staes. Income from property in the
United States owner by nonresident
aliens is subject to the full normal
tax of IL per cent. For 1919 and
subsequent years the rates are fixed
at and per cent respectively. The
4 surtax rates have been changed
ranging from 1 per cent of the
amount of the net income between
d $4,000 and $4,000 to 65 per cent OF
the amount by which the net in
come exceeds S1,000000.
The single man with net income
for 1918 of $4,000 will pay this year
tax of $50, the man with an in
come Of $4,000 will pay S12O, the
\ $4,000 man will pay $3.50 and the
1 $4,000 man will pay $240, all at the
rate of 6 per cent on his net income
above his personal exemption Of ST.,
600. The single man with an income
I for 1918 of $4,000 will pay $$370. He
is taxed at the rate of 6 per CEN
on his first $4,000 above the exemp
I tion and at II per cent on the re.
naming $1,000, total of $3.50. Ir
addition he pays a surtaX of $50, ]
i per cent of the amount of his income
between $4,000 and $4,000.
The married man will pay $50 on
net income of $1,000 in excess of
his personal exemption, $50 on a 3d.
600 income, $120 on $4,000 income,
$3.50 on a $4,000 income and $3.50 on
$4,000 income, which includes his
surtaX of $40.
These figures are based on the in
come of taxpayers without dependent,
other than husband or wife. The
taxpayer is allowed, in addition to his
personal exemption Of 5000 for each
person dependent upon for chief sup
port, if such person is under Is years
of age of incapable of self support.
nder the 1917 act the 5000 exemption
was allowed only for each depen-
dent Child" of the person making
the return, or, in the case of a head
of family, for each dependent child
of the family. A head of a family
one who supports one or more per-
sons closely connected with him by
blood relationship, relationship by
marriage or by adoption-is entitled
TO all the exemption granted mar
ried person.
In his return the taxpayer is re-
quired to state specifically each item
of gross income. Gross income is de-
fined as "gains, profits and income
derived from salaries, wages or
compensation for personal service of
whatever kind and in whatever form
paid, or from professions, vocations,
trade business, commerce or sales or
dealings in property, whether real
or personal, growing out of the own
ership or use of such property; also
from interest, rent, dividends, securi-
ties or the transaction of any busi-
ness carried on for gain or profit, or
gains or profits, and income derived
from any source whatever"
Net income, upon which the tax
is assessed, is gross income less cer-
tain deductions which are more lib