The Brandon news. (Brandon, Miss.) 1892-1961, 1920-03-18
FARMERS INCOME
SUBJECT TO TAX
Gains for 1919 Must Be Figured
Under u. S. LaW-ReturnS
Due March 49,,
LAND SALE PROFITS TAXABLE.
Necessary Farm Expenses May Be De.
ARCHAEOLOGICAL Form for Farm
lncome-Cash or Accruai
Basis for Computing.

A farmer Shopkeeper or tradeSman
must figure up his net income for 1919;
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 Is.
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 a 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 SHOW
els, rakes, etc. Also, the cost Of feed
purchased for his live stock may be
treated as an expense, in so far as
this cost represents actual outlay but
the value of his own products fed to
animals is not deRuctible item.
Other farm expenses allowable are
the cost of MINOR repairs on buildings
(but 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, as in tree
planting, ditching, etc, cannot be
claimed against earnings. A farmer Is
not allowed to claim a salary for him.
self or members Of his family who
work on the farm.
Wear and Tear.
Purchases 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, 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-
c3usively 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 Q growing crop Is not a
much as the value Of the crop had aot
been taken into gross income. The
loss Of q building or Of machinery
through storm, lightning, food. ETC.. Is
an allowable deduction, but care should
| be used TO ascertain the correct loss
sustained, as restricted by income tax
| regulations
No deduction is allowed in the case
| C loss Of animals raised on the farm
bat loss Is deductibie from gross In.
come II the animals had been pur.
chased for draft or breeding purposes
Shrfnkage In weight or value Of farm
| products held for favorable market
prices cannot be deducted as loss, fol
| the reason that when such products
| ARD sold the shrinkage Will be reflected
In the selling price.
| eaie Of Farms and Land.
The value Of agricultural lands ha.
been jumping during the past few
years, and during 1919 many owners
sold out part or all Of their lands at BIZ
profits. All such gains constitute In
| come and must be taken into the ne
| income Tor the year
ANY person who soil part Of farm
Or ranch, or part Of parcel Of land
must also show any gains realized b,
the sale
The method Of fguring gains ant
| Losses On such transactions Is prescrib
= q he 1acons Iax zegglatlens