Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-12-05
WILL BE MANY COME-BACKS
ON 1o17-18-19.2O TAX RETURNS
Reviewer Working on 1917 Reports, Which
Must Be Used by March 15-Testing
Farm Loan Bank.

BIT I. A. FLEMING.
Because you have paid your income
! taxes for 1917-20 is no reason why
you should feel chesty about it and
! consider that you are entirely square
with Uncle Sans fiscal department.
and that you may. in so far as your
income returns are concerned, rest
! easy and comfy. 1t is within the pos
sfbilitfeS, almost probabilities. that
you have a rude awakening coming to
! you. no matter how careful you were
or how high priced or capable the
expert who prepared your schedule.
Some local corporations have been
I badly 5olted during the last few days
by the comeback from the internal
revenue bureau division of review.
where the experts of the bureau are
making frantic efforts to complete
: their revision of the 1917 returns.
Under the law the income tax re-
turns Of 1917 are renewable only up
to March Is. 1921. three years from
maturity. hence the efforts to complete
+ revision or at least get as far as pos
sible before the statute of limitations
runs against additional taxation for
that year.
On all later returns, 1918 and later.
the law gives the reviewers five years
for research. and they VIII PROBABLY
need the time limit. as those OF 1919
(; have not been scratched. 1919 returns
have not been given any consideration
. and 1920 returns will be due three
months hence.
May he Several J0lts.
From, this plain statement of the
case it will be seen that there is q
chance for corporations and even for
individuals being caught and given
!, additional penalties on each years
return.
One corporation, one of the leading
local companies. has been hit very
seriously by the reviewer and the re-
duction of capital invested, through
alleged depreciation Of property OF
the company, materially increases the
excess tax. But the victim in this
case declares that there has been no
| depreciation. that the property is
, more valuable today than even the
book values show. hence the invest
! ment is not less. 1t seems an in5us-
tice in this case and probably viii be
ners are lacking in the letters of the
! law. not we'll grounded: indee, the
law itself is so complicated that law
yers differ. The United States Su-
| preme Court will probably decide the
big local case in question.
/ On the other hand one OF our ma
tional banks has been called for a
1 deficiency in it's 1917 taxes amount
Ing to $64. and payment requested and
l made.
| A number of 1917 individual ac-
| counts. involving 500 and under have
|! also been called to the attention of
| local people, and payment requested.
1t is not a pleasant thought, and
yet It is a fact that any one or any
corporation is liable to receive mott.
dcatiOn of an alleged shortage to be
made up.
Columbia GrapAcphone.
Washington shareholders are VII
tally interested in Columbia GRAPHIC
phone shares. both common and pre-
ferred. A year ago, or rather In the
early months of 1919. they acquired
considerable common stock and made.
II they sold their investments, good
money. Unfortunately or otherwise.
there are thousands Of shares being
carried in the city today.
The rush of financing done by the
company in connection with its new
factories. etc. and the various meth
! DDS involved have seriously impaired
the value of the preferred shareS as
well as the common. Perhaps short
sightedne5s in business acumen
might be charged in enlarging plans
4 The preferred stock was put out
here at IS, and with no bonds ahead
Of it was considered high-gfade in
/ ycSlIutnt. but u way W9S fIOuH0 ~
get notes, etc.. ahead Of the preferred
stock and weakened its position.
Probably the company has suffered
In common with all other purveyors
to the general public by reason Of
the silent strike.
The preferred shares have not
moved on this market for some time.
and it is small satisfaction to fnd
/ them selling at 81 on the New York
market and the common not far
above the low point of the hquida-
ton period.
Friends of the company and in
1 vestors carrying their securities in
this city urge that the directors
place the stock on a cash dividend
basis and stop the stock dividend
given with each quarterly distribu-
ton. They argue that it would have
an especially good effect on the stock.
Many large investors are still carry
ing their stock and will go with it.
but will not add to their holdings.
and when the dividend Is paid there
is an immediate liquidation Of the
stock dividend-a great block Of
stock pressing on the market.
n 1t IL believed that with a 2 per
4 cent cash dividend the stock will
readily sell around re to 80 instead Of
the 13A OF this noon.
An InDsrtant Case.
W. B. Hibbs & Co. have this to say
on the case now pending in the
/ United States Supreme Court, and
! upon which ruling may be handed
down tomorrow:
The case is that Of Charles e. Smith
/ VS.. the Kansas City Title and
Trust Company. appealed from the
United States Court Of the western
district of Missouri and Is An
agreed case to bring before the Su-
preme Court the constitutional power
of Congress to charter farm loan
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