The herald and news. [volume] (Newberry S.C.) 1903-1937, 1920-03-09

and if the farm or business income
plus his other income was sufficient TO
REQUIRE an income tax return a COM
pIete 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 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, cultirating, 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 US an expense in so far as this
cost represents; actual outlay, but the
value of his own products fed to ami
mails is not detluctible item.
Other farm expenses allowable are
the cost of minor repairs on buildings
(but not the dwelling house), on fences,
wagons ard 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 Ia hired holN. al the productive
labor is y ,le,iuctih!e expense; but the
WAGES OF Household servants. or help
hired 10 improve the farm, rs in tree
planning. di:chiEg. etc, cannot he
claimed against earnings y farmer is
not allowed to claim a salary Tor HIM
self or members Of his family who
work on the farm.
Wear and Tear.
Purchase Of farm machinery, waS-
ons. work animals, ETC.. also the cost
Of construction or extension of build
ingS, silos. fencing, etc, should be con-
sdered 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, windmills and other farm
equipment 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 upkeep is an allowable
deduction, if the machines are used ex-
clusively for farm purposes and not
for pleasure. Also, in such cases, de-
duction for wear and tear is allowed.
Farm Losses.
The loss of q growing crop Is not a
proper deduction from income, mas
much as the value of the crop had not
been taken ipto gross income. The
loss of 4 building or of machinery
through storm. lightning flood. etc, is
an allowable deduction. but care should
be used to ascertain the correct loss
sustained as restricted by income tax
regulations.
30 .lcdurtinn IS allowed in The case
OF less OF animals raised on tie farm,
but Il loss is daAuctible from cross in
come If the animals had been rur-
chased for draft or breeding purposes.
Shrinkage in weight or value Of farm
products held for favorable market
prices cannot be deducted as q loss. for
the reason that when such products
are sold the shrinkaSe will be reflected
in the selling price.
Sale of Farms and Land.
The value CT agricultural lands has
been jumDing during the past few
years, and during 1919 many owners
sold out part or all Of their lands at
big profits. All such gains constitute
income and must be taken into the net
income for the year.
Any person who sold part Of a farm
or ranch, or part Of parcel Of land,
must also show any gains realized by
the sale.
The method Of figuring gains and
losses on such transactions is pre-
scribed in the Income Tax regulations,
copies of which may be secured from
Internal Revenue Collectors.
Forms for Returns.
The Internal Revenue Bureau has
issued an improved Form 1040F for
the use Of farmers. This form, to-
gether with Form 1O40A or 1910, will
gether with Form 10i0A or 1040, will
give the farmer explicit information
as to how to properly figure his net
income for 1919.
There are two methods Of figuring a
farmers income tax return this year.
lie may make his return on the basis
oe fhe difference between the money
and goods received for his products
md the cash paid out for actual allow
r,,, within tbn