Metropolis weekly gazette. (Metropolis, Ill.) 1???-19??, 1920-07-09


piete return must be fled 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
d1ced gu the farm or purchased and
regold.
Farm Expenses.
From his gross income a farmer is
allowed TO charge of ali OF his neces-
Sary expenses in the conduc6 of the
farm during the year These include
costs Of Planting. culsivating. harvest
ing and marketing. To addition TO
these costs he may deduct money spent
for ordinary farm tools OF short life
bought during TIE year. such as show
els, rakes, etc. Also, the cost OF feed
purchased for his Use stock may be
treated as al expense In SO far as this
cost represents actual outlay. but the
value Of his own products FED 70 ami
mails is not q deductlhle Item.
Other farm expenses allowable are
she cost Of minor TepslFa on buildings
fhut moi the dwelling house1. on fences,
Wagons and farm machinery also bills
paid for horaeshoeing. stock powders.
rOck, salt, services OF veterinary, insar-
nnce texcepr on dwelling housed. gsso-
line for operating power and sundry
other expenses which were paid for IN
cash.
AS TO hired help, eli the productive
labor Is a deducfible expense: but the
wages OF household servants. or help
hired TO improve the farm as Ia tree
planting, difching. ETC. cannot be
claimed against earnings A farmer Is
not allowed so claim salary for him
self or members OF his family who
work on IKE farm. 49,
Wear and Tear.
Purchase Of farm snachlnery, sag
one. work animals, etc. also the cost
Of construction or extension OK build
iHga. slIos fencing. etc, should be con.
sldered additional Investments In the
farm and Ree-n noe proper deductions
against income.
A reasonable allowance may be
claimed for wear and tear on farm
buildings Except the 1armhouseD,
fences. machinery, work animals wag-
0ns, tanks. wlndinllis apd other farm
equipment which is used sn she con-
duct Of the farm.
As 10 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-
clusiveIy FOR farm purposes and not
for pleasure. Also IN such cases. a de-
duceion Tor Wear snd tear Is allowed.
Farm Leeses.
The loss Of growing crop Is not a
proper deduction from income. mas
much az The value OF The crop had not
been taken into gross income. The
loss 81 building or Of machinery
through storm. lightning. food etc, IL
an allowable deduction, bua care should
be used 10 ascertain tie correct loss
sustained. as restricted by income tax
regulations.
No deduction ig allowed IN the case
Of loss Of animals raised on the farm,
but loss Is deductible from gross in
come II the animals had been pur-
chased for draft or breeding purposes.
Shrinkage In weight or value OF farm
products held for favorable market
prices cannot be deducted as loss, for
the reason that when such products
sre sold the shrinkage win be reflected
in the selling price.
Sale Of Farms and Land.
The value OF agricultural lands mas
been jumping dGfihg the past few
years, and during 1919 many owners
sold out part or all OF their lands az
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 IL pre-
scribed 10 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 1O4oA or 1040, will
give the farmer explicit information
az to how TO properly figure his net
income for 1910. ~
There are two methqls Of figuring a
farmers income fax return this year
lie may make his return on the basis
OF the difference between the money
and goods received for his products
'and the cash paid out for actual allow
able farm expenses within the year.
Or he may make his return on the &C
cruaI basis. which means computing
the receipts and expenses that pertain
To the taxable year, excluding income
earned and expenses Incurred IN pre-
.tcus or succeeding years.