Yorkville enquirer. [volume] (Yorkville, S.C.) 1855-2006, 1921-03-25
TO SUFFER PENALTY J.
Government viii Get 'H1ml8ss s'sho.
Failed ID. .'.Pay: !! N. ! s.
ARE fes;'TAlKE lHliIiIEDiilTE t'AG1it6t4E
Washington Has: Already Given Orders
+ to Get Out and Aftss5S; 7IbeT-:Ms;lnYs
Who Are Liable Failed Z, Pays, i5s,:i5 i
The following is from the New York

Who Are Liable F allied Il, Psy.,:, 4 ~ y
The following is from the New York
Times; :. :. j.. :, !. +. ,G..sSs
Local collectors Of internal revenue,
under orders from, Washing ton. were
preparing yesterday. while their for,
ces were still trying to, clean UP the:
final batch OF income tax returns, and
payments that arrived by mall Ito
proceed against, taxpayers who, IN
preparing their returns. omitted, from
gross income all gains from the sale,
Of capital assets. .-;!:..,E B:
The taxpayers, In: omittlng these
items fl ON their returns. based their
action on the decision Of; the district
court Of the United: States, for !; the,
District Of Connecticut In the case.of
Brewster against Walsh. The court
in this case. held that gains; from the,
sale Of capital assets were not taIa-:
Bile. rThe Bureau ;ofSInt ernsl ReVeSi
nue. has not ;acquiesced IN the decision
and the United States II Attorney for
Connections has appealed to the United
States Supreme Court: -, .E ,,iS.,; a!
Hundreds perhaps thousands, Of tar;
payers, On the advice Of Lawyers, SSdis,,
not include. in gross income gains from,
the sale of capital assets, 8 s; (, ! ~ -
Three different courses were taken!
by taxpayers, with regard toSitema, AT af:is
fected by the Brewster decision" a Dr.
Joseph j. Klein, an authority on the I'M;
come tax, said last night" First; many
of them paid the tax. under: protest;
They of course, are not affected rbys the'
commissioners !, order. The second
class did not include gains; from the.
sale Of capital assets In: gross, ineoms,;
but attached an explanation that they
were ondtting such gains as AirssuitS S6f1
the Brewster decision. a third ..AtepS
that many took was to forget 81 ahoaE:
such items entirely and not mention;
them In the returns. I ~ y: "
MANY lawyers advlsed. their clients:
that in their opinion taxpayers mtshtt
take :advantase.ofs the decision at once:
The Bureau Of Internal Rsvsspy I, ,s:h9ss q
ever, has alwaya:N taken !! the HoA sh9t.
that decisions by, minor courts ido: o:not,
affect the administrationso OF tile taxss
but that the point 8: :m4Hs be- sctdsdSbyy::
the United States sabfams Court !; ssS,s: 8:
f-r1Ei6f Pifoessd sAsifSSe $yS5sss s
An. order dated MafSh1 di Endr rsishsd
by Commissioner William N. Wllllalhss
Of the Bureau Of Internal Revenue haa,,
been sent to all Colledtorssot Internal;
Revenue for. the ,inattpett6n hi nFp:
ceeding against. taxpay sfssa who 5 f!eds esl
their returns in accordance Wfth: the;
Brewster decision. The order Sajs:: 4, y
This office has been Advised that
many taxpayers In preparing their ins:
come and profits tax returns for, 1920
have omittedEor intended 70 omit from.
gross income all gains from the sal. .ot
capital assets. The taxpayers In tax
ing this action are evidently relying
upon the decision OF. the, District Court
of the United States for tie District
Of Connecticut in the case:of Brewster
VS.. Walsh. 26S Fed POI 4. 4 -
1.-THE bureau has not :acauiesced: in
the decision Of the District! !Cou Z in the
case of Brewster vs., Walsh The,
United States Attorney;fori Connecticut
has been authorized to perfect an: ap-
peal to the Supreme Court sof the Unit
ed States for a review; ofi the decision.
The bureau will continue. to collect the
tax upon the gain from the sale OF
capital assets unless the Supreme
Court should hold !. Unconstitutional
those provisions Of the law taxing such,
gains. ~ - t::..,G
If the, taxpayer in preparing his in:
come tax return, omits, from gross In.
come the gain from sale Of capital
assets, Fand fails to make a full dis.
closure of the facts. he Will be>subject
to the additional tax plus interest, on
this gain, and in addition thereto will
be liable to the penalties for: negligence
or fraud. s.J,.: -
1.-THE collector should examine the
returns as filed to discover those cases
in which the taxpayer has :, omitted
from gross income the gain from the
sale of capital assets and! has made a
full disclosure. In such cases the col.
lector should Immediately serve, upon
Form II, notice and demand for the ad-
ditional tax due. and after the ter. day
period proceed to collect THE tax. plug
interest and the penalty for delinquent.
cy, by distraint. IL necessary .';..ss
AS a result of Commissioner VIII,
iiams's instruction, collectors are. pre-;
pairing to take action in the cases OF:
those who have made q full disclosure
of the facts" This means those. tax
payers who have reported gains from
.he sale of capital assets but,who have
not paid the tax. The disclosures JUS
ually have been in the form OF fjder
attached to the return in which the exS-:
PLANTATION is made that the gain, is: not
reported as gross income. -; :. -:
Taxpayers who have made. e. tlil
disclosure" may escape penalties II they
pay the additional sums due before the
expiration of the ten-day period; After