The Filer record. (Filer, Idaho) 1919-1930, 1920-03-04
Gains for 1919 Must Be Figured
Under U. S. LaW-Returns
Due March IS.
LAND SALE PROFITS TAXABLE.
Necessary farm Expenses May Be
Deducted-epeciai Form for Farm
Income-cash or |ccrual
Basis for Computing.


plus his other Income was sufficient
require an income tax return d con
pIete return must be filed with the 60
lector or Internal revenue by March 4
A farmer should ascertain the gros
income OF his farm by computing II
gains derived from the sale or ea
change OF his products, whether pre-
duced on the farm or purchased an
resold.
Farm Expenses.
From his gross income farmer 4
allowed 10 charge on all OF his neces
ssry expenses In the conduct OF IN,
farm during the year. These include
costs OF planting. cultiyatlng. harvest
Ing and marketing In addition 10
these costs he may deduct money spent
for ordinary farm tools OF short life
bought during the year. such as shoy-
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 10 ami
mails Is not deductlble item.
Other farm expenses allowable are
the cost OF minor repairs on buildings
fbut not the dwelling house,, on fences,
wagons and farm machinery; also bills
paid for horseshoeing, stock powders.
rock salt. services OF veterinary, insur-
snce Except on dwelling housed, gaso.
line for operating power and sundry
other expenses which were paid for In
cash.
As 10 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. dltchlng. etc. cannot be
claimed against earnings. A farmer Is
not allowed 10 claim salary for him
self or members OF his family who
work on the farm.
Wear and Tear.
Purchase 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. windmllls and other farm
equipment which Is used In the con
duet 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 en-
elusively for farm purposes and not
for pleasure Also. In such cases, n de-
duction for wear and tear Is allowed
Farm Losses.
The loss OF growing crop Is not a
proper deduction from Income. mas
much MS the value OF the crop had not
been taken into gross income. The
loss Of . building or OF machinery
through storm. lightning. food. etc. IL
IN allowable deduction. but care should
DO used TO ascertain the correct loss
sustained. rs restricted by income tax
regulations
No deduction Is allowed In the case
n loss Of animals raised on the farm.
but loss Is deductible from gross In
'ome II the animals had been pur-
'hssed for draft or breeding purposes
Shrinkage In weight or value OF farm
PRODUCTS held for favorable market
'rices cannot be deducted rs n loss. for
he reason that when such products
re sold the shrlnkage viii be reflected
u the selling price.
sale Of Farms and Land.
The value OF agricultural lands has
'een jumping during the past few
ears. and during 1919 many owners
old out part or all Of their lands al
10 profits All such gains constitute
ncome and must be taken into the nett
aecme for the year.
Any person who sold part OF farm
2 ranch. or part Of a parcel OF land
,ust also show any gains realized by
he sale.
The method OF figuring gains and
'sses on such transactions IL pre-
,rihed In the Income Tax regulations.
,piss Of which may be secured frvm
,ternal Revenue Collectors
Forms for Heturns
The Internal Revenue Bureau has
sued an improved Form t0sOF for
70 use Of farmers This form. to-
,thcr with Form losoA or 1910. will
We the farmer explicit information
J 10 how TO properly figure his net
Gene for 1919.
There are tive methods Of figuring q
fmss's income tar return this year
: may make his return on the basis
the difference between the money
Il gceds received fer bis products
ID the cash paid out fer actual allow
'& farm expenses within the year
! he may make his return on the &C
mai basis, which means computing
: receipts and expenses that pertain
the taxable year, excluding income
Ifasd and expenses incurred IN pre-
pus Or succeeding years
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