The Punta Gorda herald. [volume] (Punta Gorda, Fla.) 1893-1958, 1920-03-04
FARMERS INCOME
SUBJECT TO TAX
Gains for 1919 Must Be Figured
Under U. S. LaW-ReturnS
Due March Is.
LAND SALE PROFITS TAXABLE.
Necessary Farm Expenses May Be
Deducted-SpeelaI Form for Farm
lncome-cash or Accrual
Basis for Computing.

income-CaSh or AccruaI
Basis for Computing.
A farmer, shopkeeper, or tradesmat.
must figure up his net income for 1910
and If the farm or business income
plus his other income was sufficient to
require an income tax return COM
plete return must be filed with the col
lector of internal revenue by March 10.
A farmer should ascertain the gross
income of his farm by computing all
gains derived from the sale or ex-
change of his products, whether pro-
duced on the farm or purchased and
resold.
Farm Expenses.
From his gross income q farmer is
allowed to charge off all of his neces-
sary expenses in the conduct of the
farm during the year. These include
costs of planting, cultivating, harvest
ing and marketing. In addition to
these costs he may deduct money spent
for ordinary farm tools of short life
bought during the year. such as shov-
els, rakes, etc. Also, the cost of feed
purchased for his live stock may be
treated as un expense In so far as this
cost represents actual outlay, but the
value of his own products fed to ami
mails is not a deductible item,
Other farm expenses allowable are
the cost of minor repairs on buildings
tb',t not the dwelling house), on fences,
wagons and farm machinery; also bills
paid for hOrseshoeing, stock powders,
rock salt, services of veterinary, insur-
ance Except on dwelling house,, gaso-
line for operating power and sundry
other expenses which were paid for in
cash.
AS to hired help, all the productive
labor is deductible expense; but the
wages of household servants, or help
hired to improve the farm, rs in tree
planting, ditching, etc, cannot be
claimed against earnings A farmer is
not allowed to claim salary for him
self or members of his family who
work on the farm.
Wear and Tear.
Purchase of farm machinery, wag-
ons work animals, etc, also the cost
of construction or extension Of build
ings, silos, fencing, etc, should be CON
sidered additional investments in the
farm and are not proper deductions
against income.
A reasonable allowance may be
claimed for wear and tear on farm
buildings Except the farmhouse),
fences, machinery, work animals, wag
ons, tanks, windmilIs and other farm
which is used in the con-
duct Of the farm.
As to autos and tractors, the cost of
these Is not an expense, although the
cost of their upkecp Is an allowable
deduction, if the machines are used ex-
for farm purposes and not
for pleasure. Also in such cases, a de-
ductiOn for wear and tear is allowed.
Farm Losses.
The loss Of Il growing crop is not
proper deduction from income, mas
much as the value of the crop had not
been taken into gross income. The
loss of a building or Of machinery
through storm, lightning, flood. etc, is
IN allowable deduction, but care should
De used to ascertain the correct loss
sustained, as restricted by income tax
No deduction is allowed in the case
" loss of animals raised on the farm,
but loss Is deductlble from gross in.
:ome II the animals had been pur.
,hased for draft or breeding purposes.
Shrinkage In weight or value Of farm
PRODUCTS held for favorable market
prices cannot be deducted as loss, for |
he reason that when such products !
ire sold the shrinkage will be reflected
n the selling price.
Sale Of Farms and Land.
The value OF agricultural lands has !
been jumping during the past few |
'ears, and during 1910 many owners
'old out part or all Of their lands al
zig profits. All such gains constitute
income and must be taken into the net
income for the year.
ANY person who sold part of n farm
n ranch. or part Of parcel of land
must also show any gains realized by
he sale
The method of figuring gains and
osses on such transact is pre-.
cribed in the Income Tax regulations
opies OF which may be secured from
Rternal Revenue Collectors.
Forms fer Returns
The Internal Revenue Bureau has
ssued an improved Form 1040F for
he use OF farmers. This form, to.
ether with Form 10i0A or 1910, will