Cottonwood chronicle. [volume] (Cottonwood, Idaho) 1917-current, 1919-03-07
THIS TELLS HOW TO
FIGURE INCOME TAX
Squarely Up 70 Every Individual
to Get Busy by March IS
or Suffer Penalty.

"Dont wait until the final due date
March 18th, for paying your Income
Tax and making your return. Avoid
the last minute rush. Any person can
figure out his liability today as well as
| he can next week, and If there is any
! point on which he needs advice he can
now get in touch with a Revenue man"
This word of advice is from William
! G. Whaley, Collector of Internal Reve
nue., Helena, Mont, who is collecting
the Income Tax in Montana, Idaho and
| Utah. Collector Whaley Is giving with
| out charge every aid of his Office and
his enlarged field force to help the peO-
| pie get their payments and their re-
turns in by March 18th.
But the Income Tax men will not
| pull your door-bell or your cOat-tails,
| according to the Collectors announce
ment. 1t is, squarely up to every mdi-
| vidual to figure out his own case and
to get busy if he comes within the
scope of the new Revenue law.
Did You Earn This Much7
Every unmarried person who receiv-
ed income averaging 1925 a week
! during 1918 and every married couple
who Jointly received income averaging
$3.50 a week should secure at once
from the nearest Deputy Collector or
the nearest bank blank Form 1040 A.
That form contains the information he
will need to enable him to figure his
correct net income and any tax that he
owes the Government
The law requires that every unmar-
ried person who had net income of
$1,000 or over and every married per-
son whose net income was $1,000 or
over Gncluding the income Of husband.
or wife, and the earnings of minor
children, if any must make a return
on or before March 18th. And this re-
qulrement does not hinge on whether
the person owes tax.
Taxable Income.
An individual must include under
gross income all gains, profits and in
come derived from salaries, wages, or
compensation for personal service Of
whatever kind and in whatever form
paid, or from professions, vocations.
business, sales or dealings In property
of all kinds, interest, rent, dividends,
or profits derived from any source
whatever Very few items of income
are exempt.
Deductions Include ordinary and nee
essary business expenses, interest paid
or accrued on Indebtedness, taxes Of
all kinds except Federal income and
excess profits taxes and assessments
for local benefits, losses actually sus-
tanned, debts ascertained to be worth
less, and depreciation on buildings, ma
chinery, fixtures, etc, used in business.
further deduction Is allowed for con-
tributions to corporations operated for
religious, charitable, scientific or edu-
cational purposes or for the prevention
OF cruelty to children or animals to an
amount not exceeding 10 per cent of
the taxpayers net income as computed
without the benefit of the contribution
deduction
The taxpayer Is not allowed to de-
duct any personal, living or family ex-
pense, any amount spent for improving
property, or any expes6e of restoring
property or making good its exhaus-
ton for which an allowance Is claimed
under depreciation.
Figuring the Tax.
Before Fl, uring the normal tax the
dividends are deducted as credits from
net income, together with the personal
exemption. AS in previous years, divl-
dends of domestic corporations are ex-
empt from normal tax when received
by the stakeholder
The normal tax rates for citizens
and residents are as follows: On the
first $4,000 of net income in excess of
the credits the rate is per cent; on
any further taxable income the rate is
IL per cent
The surtax rates apply to net in
come OF each individual in excess of
$4,000. The personal exemption and
the dividends are not deductlble before
computing Surtax. In the case of re-
turns by husband and wife, the net
income of each Is considered separate
ly In computing any surtax that may
be due. Form 1910 should be used for
making returns of net income exceed
Ing $4,000, and the Instructions on that
form will show how to figure the sur
tax.
Business House Returns.
Employers and others who paid
wages, salaries, rents, Interest or sim
liar determinable gains in an amount
OF $1,000 or over during 1918 to any
person must file an information return
with the Government. Blanks may be
secured from the Collector.
Every partnership must file a return
showing its income and deductions and
the name and address of each partner
with his share of the profits or losses
during the past year. Personal service
corporations will file similar informa.
ton for 1913.
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