The Clay City times. [volume] (Clay City, Ky.) 1901-current, 1920-02-26
Gains for 9Must Be Fi1ured
Under U. S. Law--Returns
Due March IS.
LAND SALE PROFITS TAXABLE
Necessary Farm Expenses May Be
Oeducted--speclai Form for Farm
Income-cash or Accruai
Basis for Computing.


must figure up his net income for 1919;
and IL 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 OH the farm or purchased and
resold.
Farm Expenses.
From his gross income farmer Is
allowed to charge of 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 he
treated as an expense in so far MS his
cost represents actual outlay, but the
value of his own products fed to ami
mails Is not deductible item.
Other farm expenses allowable are
the cost of minor repairs on buildings
fbu' not The dwelling house), on fences,
wa"cns and farm Inachinery; also bills
paid for horseshoeing. stock powders,
rock salt. services of veterinary, insnr-
ance texcept on dwelling housed, gaso-
other expenses which were paid for In
cash
AS to hired help, all the productive
labor is a deductible expense; but the
win -es of housc''old servants, or help
hired to improve the farm, as in tree
planting. difching. 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-
OuS, NOih dHiltlulc, ttC., uiSO TIC toSt
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, windmils 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, II the machines are used ex-
clusively for farm purposes and not
for pleasure Also. In such cnses, a de-
duction for wear and tear Is allowed
Farm Losses.
The loss OF growing crop Is not
proper deduction from income mas
much as the value Of he crop had not
been taken into gross income. The
loss OF q 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
No deduction Is allowed in the case
Of loss OF animals raised on the farm.
hut loss Is deducilble from gross In
come II the animals had been pur
chased for draft or breeding purposes
Shrinkage I'm weight or value OF farm
products held for favorable market
prices cannot be deducted as loss. for
the reason that when such products
are sold the shrinkage will he reflected
In the sell'n" nr'ee