The daily Gate City and constitution-Democrat. (Keokuk, Iowa) 1916-1922, 1920-02-09
Government Has Sharp Eye Out to See
That Equitable Adjustments are
Made in All These
Cases.
RENTS AND SALES IN 1T
Certain Deductions Can be Made, Al.
lowing for Repairs, Property
Losses and the
Like.

eye tnlS spring, TO see tnat ruiz IN
come tax is paid on rents received
during 1919, is acknowledged by the
internal revenue officials.
Every income tax blank has
special space get apart for reporting
rents received And this space will
be watched as the returns come in,
to check up the rents of landlords
and landladies.
These are bonanza days for real
estate owners. Rents for all kinds
Of property ha;. advanced; in some
localities, to prices never dreamed
of. The keepers of lodging houses
and boarding houses have shared in
the general prosperity from rents.
And even the cottage and apartment
dweller has made little money on
the side by renting the rooms he
could spare.
The higher prices of 1919 induced
many landlords to sell all or part of
their property, and generally at sub
stantial gains. All such gains are
income, and must be figured out in
black and white on the annual return.
Persons who held leases on prop
ierty. and during 1919, sublet at
profit, must show such gains in their
income tax returns.
How to Report Rents.
The forms for personal income tax
are designed so that income from
rents and royalties shall be separated
from other income. The information
and figures should be carefully and
accurately entered in block ''E.'
The kind Of property rented should
be indicated. If it is building 1t
- III, ~,
struction is of wood, cement, brick
or stone. If a farm, or vehicles, ma
chinery, etc, it should be SO stated.
If the taxpayer received royalties,
the word royalties" should be used
to denote the source of income. And
for convenience in checking the re-
turn, the taxpayer should separate
the various kinds Of property, and
show separately the figures of rents,
. expenses, etc, incident to each class.
If any OF your tenante or lessees
paid you $1,000 or more in rents dur
ing 1919, you should show the names
of such tenants or lessees separately
=; in the second column of block "E,
together with the amount Of rent re-
ceived from each.
In column you should declare the
amount of income whether in cash OF
its equivalent during the year from
each class Of rented property.
Figuring the Deductions.
| Repairs.-Under this title the tax.
payer may claim only actual expen-
ditures for small repairs such as re-
placing broken glass, fixing water
pipes, papering, interior painting and
other small necessary repairs neces-
sary to keep the place in rentable
condition. You are not allowed to
include the purchase of new range,
a new boiler, or other requirements.
If the entire property is rented, ex-
terror painting may be included rcd"r
repairs, but new roof new cement
walks or steps, or other similar tx
penditure that adds to the value of
the property may not be included as
an expense.
Wear and tear-If the charges for
repairs are made strictly in accord
ance with the above, a reason tble
allowance may BIO claimed for wear
and tear Of the property caused by
it's use during the year. The basis
for computing such q charge is the
cost of the property, or. II owned
prior to March l, 1918, It's fair market
value at that time.
It is important here to- point out
that the cost or market value Of land
must be included in any computation
for wear and tear, for land is ordi-
narily not subject to wear and tear
and exhaustion. Where loan, gravel,
clay, sand, etc., is removed for sale,
there may be a deduction allowable
for depletion.
The other factor in computing the