, 1919-03-06
HOW TO FIGURE INCOME TAX.
Continued from First page)

ed an income averaging $19.25 a weeE
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 a blank Form 1910 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 a net income of
$1,000 or over and every married per-
son whose net income was $1,000 or
over Cncluding the income of husband
or wife and the earnings of minor
children, II any must make a return
on or before March 18th. And this re-
'quirement does not hinge on whether
the person owes a 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, voc%ations,
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 a~scertained to be worth
less and depreciation on buildings. ma
chinery, fixtures, etc, used in business.
A 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 expense of restoring
property or making good its exhaus-
ton for which an allowance IL claimed
uhuer uepreciatioh
Figuring the Tax. .
Before figuring the normal tax the
dividends are deducted as credits from
net income. together with the personal
exemption. AS in previous years, divi-
dends of domestic corporations are ex-
'clnpt 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 6 per cent; on
Iny further taxable income the rate is
Il per cent. b
The surtax rates apply to net in
rome of each individual in excess of
$4,000. The personal exemption and
the dividends are not deductible before
computing surtax. In the case of re-
turns by husband and wife. the net in
:ome of each is considered separately
In computing any surtax that may be
due. Form 104O should be used for
making returns of net income exceed
lDg $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
Df $1,000 or over during 1918 to any
person must file an Information return
with h Government. Blanks may be
secured from the Collector. T,
Every partnership must file a return