The Washington herald., 1921-12-04
CITES ADVANTAGES
UNDER INCOME TAX
BILL FOR INVESTOR.
Says Amendment Will
Aid and Encourage
Building Activities.
SPECTATORS HIT
Will Stimulate Employment
In Erection Field; Hard
ships Relieved.

c Clinton James. president of
the Building and Loan Association
Council of the District of Columbia.
is bringing to the attention of the
local building ad loan associations
the provision contained in the new
income tax bill. which exempts the
first $500 income derived from divi-
dends in a building and loan asso
citation from the income tax.
This means that an investing
member of a building and loan as
ISOLATION can invest between $1,000
and $4,000 in building and loan
stock and will not have to pay any
income taxes on that account. The
provision OF law reads as follows:
so much Of the amount received
by an individual as dividends or m
terest from domestic building and
loan associations. organized and
operated exclusively for the actual
benefit OF their members, as does
not exceed 5000
The purpose of this mendment to
the new income tax bill is to en-
courage greater investments in the
shares of local building and loan
societies in the country, in order
that these institutions may be en-
abled to more adequately meet the
demands made upon them by MEM
bers desiring to build or purchase
dwelling houses; and thus, while
promoting systematical thrift, to
relieve the hardships caused by the
housing scarcity. and stimulate the
greater employment of labor in the
building industries.
The chief and fttest agencies
that exist for financing small house
construction and purchase are the
domestic building and loan associa-
tions Of the country. There are
5000 of them and they are scat
tered from coast to coast The ag-
Eregate membership exceeds 5000
900 men, women and children, al
most Invariably of small or mod
crate means. They deal exclusive
ly with the small home seeker who
Is most affected by the housing
scarcity.
The United States league REPORTS
collected from every section Of the
country, show that the loans made
to home seekers last year by these
institutions aggregated more than
$500. 900, 900. The reports are in
vartably at the present time show
Of adequate loaning funds, are
Obliged to disappoint thousands Of
families seeking ownership Of their
homes through this system Of self
help This exemption is not likely
to reduce public revenues to any
appreciate extent. but even II such
was the case the law would Justify
itself for the reasons stated. Loss
OF revenue is. by no means. to be
assumed Rich spectators can not
profit by the exemption, since not
more than 5000 incomes during any
one year is affected.
On the other hand II is quite pos
sible that IL will produce a con-
siderable increase of investment in
building and loan societies, and the
indirect effect would be an increase
OF public revenue, municipal, State
and national, through the greater
stimulation OF the building indus
tries throughout the country. This
stimulation will be felt by manu-
facturers Of all sorts of materials
used in the construction and op-
Grafton of dwelling houses. RamI-
fications of the building Industry
are so many and divers that the
benefit to capital and labor that
would come from a general resump-
ton OF building OF new houses
would be very great indeed. Eng
land undertook government sup
ported agencies to provide housing,
which resulted disastrously in
waste and extravaganza, along
with the generalization Of the nor
NAL activities of private initiative
and enterprise.
The building and loan asoscia-
tons throughout the country have
the machinery already set up. and
by this exemption Congress has pro-
vided a way of helping the people
10 help themselves, by increasing
the incentives for Individual thrift
and industry and removing the PEN
alties that unwise taxation poll
cies now impose upon savings funds
that are employed in the creation
Of homes Credit for this legisla-
ton is due largely to the Legisla-
tive Committee of the United States
League OF Local Building and Loan
Associations, Of which Mr.. Charles
O'Connor Hennessy, of New York, is
chairman and Mr.. Herman F. Cell
larius. OF Cincinnati is secretary.