Evening journal., 1920-03-10
Income TAX
REFUND TO
DELAWAREANS
tconlInued From FIrst Page.l

CONTINUED From First Page,
stock paid by corporations In new
stock issues could not be construed as
taxable. caused quite a furry among
corporation officials and individuals
The individuals who already had illed
returns including In their taxable basis
the stock that they received in pay
ment OF dividends were the more con
cerned.
Collector OF Internal Revenue era
ham received a telegram from Com
missioner OF Internal Revenue Roper
yesterday which explained briefly the
Interpretation put on the ruling by
the Bureau. The telegram was as
follows:
Claims for credit against FIRST
installment March ~ on amount
of tax paid in prior years on stock
dividends may be accepted, but
must not be permitted 10 reduce
payment Of March ~ installment
unless claims on Form 4r-A is fled
dends received and taxes paid
therein, and a statement OF an de-
tails OF any subsequent sale Of
shares as a stock dividtnd, and un-
less claim is accompanied by a
statement from the corporation
which distributed dividends as TO
amount distributed 10 taxpayer
and years in which profits distrib-
uted are earned"
The first two big days OF the nnal
drive week for income tax payments
have been busy ones. Yesterday the
returns were large. Most Of the pay
ers were the little fellows" Many
OF the millionaires are yet to file re-
turns and pay their taxes,
There are only five more. working
days for every taxpayer TO pay his
tax, or a quarter Of 10.
1T IS not the hundreds Of thous-
ands that come I'm that help us clear
up our task" said Collector Graham
today, 'but IL is the number Of tax
payers who come in. 1t helps US just
as much for a man to come in and
pay $40 as it does for a millionaire 10
pay his thousands. 70 simply wipes
one customer of The sheet regard
less Of who he is
One important effect Of the Supreme
Courts decision locally will be 90 fix
the status Of the dupont Company com
mon stock. received when the present
company was formed to take over the
old company's business. At that time
each stockholder Of the +. 7. duP0n;
Powder Company received two shares
OF common stock in the new company
(E. ]. dupont de Nemours and Com
pany) for each share he held in the
old company, and also retained the lat
ter stock. ON the advice OF the COM
pany's legal counsel. many siockhold-
ers did not return this new stock as in
come, but the Internal Revenue Depart
ment a few months ago notified many
dupont Company stockholders that Il
regarded the new dupont stock as a
dividend and therefore income taxable
within the law. Now that the Sulyemt
Court has ruled stock dividends arr mol
taxable. it is believed it viii clear NJ
the situation over the dupont Com.
pany's new stock that is retained by
those who received &c when the new
company was organized.
Under the Supreme Court decision. II
IS now cOntended. such stock will moi
be subject to income tax, although the
profit from 70 when IL is sold may be
subject 20 income tax.
The question Of whether stock divi-
dends when such stock is sold are sub
iect TO income tax is one point thai
the Supreme Court has not made clear
in its decision, It is claimed by some
persons, but a view held by many per
sons in financial circles in Wilmington
seems to be that II a profit is made on
the sale OF the stock dividends and the
original stock on which such dividends
were declared, such profit is taxable.