The daily banner. (Cambridge, Md.) 1897-2008, 1921-01-13

I, ON / per cent 10 % psl
/ eat on net income over
| ~ 00o.
1921 income Tax Facts You Should
know
Thousands OF letters passed in cor
rC5pondcnce last year between the
Bureau of Internal Revenue and per-
sons claiming an exemption OF S2.-
0o0 as head Of family. Circum-
stances surrounding each individual
:ase determine largely whether a
person is entitled to such exemption.
The fixing of his status decides, in
many instances, whether his income
is taxable or nontaXable. In either
event. if his net income for 1920
was $1,000 or more if single. and
50 900 or more if married. he must
lie return.
A head of a family defined by
treasury regulations as "a person
,,ho actually supports and maintains
II one household one or more lndtl
1iduals who are closely connected
With him by lhood relationship, re-
ationship by marriage or by adop-
ion or whose right to exercise fam
.iy control and provide for these de-
.pendents is based upon some moral
son living with husband or wife. in
0r legal obligation" A married per-
addition to the $1,000 exemption al
owed such persons, can not claim a
50 600 exemption as the head or a
FAMILY, irrespective of the question
If the support of others of the
household.
Single Persons
\ single person-the term in
luding widows, widowers, and per-
,ons not living with wife or husband
is the head of a family II he is
he sole support of one or more re-
atives living in the same house with
nm, and if he exercises control OF
.ousehold affairs. The 1000 addi-
ional exemption allowed a single
Derson as the head of a family can
,ot be divided between two mem-
,ers of a household. A division OF
esponsibilily for control Of house
IOld affairs" excludes both parties
rom the claim. Whether person
tho does not continuously live in
ne same house with dependent re-
atives is entitled o the So 900 ex-
mpton depends upon the character
If the separation. Ir a parent alb
,ent on business part OF the year, or
child or other dependent away at
chool or on visit. the common
ONE being maintained, the c$emp-
ION applies.
If a parent is compelled 10 main
ain his dependent children with re-
aUives or III Doardina house, ~
xemption may still apply. II, how
yer the dependent continuously
md without necessity makes his
lome elsewhere than with his
Jenefactor the latter is not the head
If family, irrespective OF the ques-
ion of support.
y taxpayer may not be the head
If 4 family and still be allowed an
xemption of $500 for each person
.ependent upon him for chief sup
)ort if such person Is under IS years
If age or incapable of selr-support
lecause mentally or physically de-
ectiye The words physically de-
-eCtive" refer not only to cripples,
Jut to persons defective because OF
I'D age or i'll health. Neither resi-
.ence, relationship. nor legal de-
5endency are factors in determining
he right Of the taxpayer to such ex-
mptiOn. To establish his claim,
he taxpayer must have contributed
.uring the year more than one halt
If the sum needed for the depen-
Ient's support.
Allowable Exemption
fnl1
)les of circumstances which govern
he exemptions allowed the head OF
family and for dependents:
\ son who has left home sends his
Mother more than half the sum re-
luired for her support. He is al
owed an exemption Of $500, unless
he mother is able TO support ger
elf, in which case the contribution
S regarded as It gift.
A son living at home supports an
nvalid mother in the same house
old. He is allowed a deduction OF
2,Q00 as the head OF n family, plus
n additional 5000 for his depen-
tents. who is PHYSICALLY ineapacitat-
d 1T should be noted that the
5000 additional exemption for de-
'filNSA'H uOtS LIol upPlS ~ uuSudho
il wife. even though either one has
ec0me q total burden upon the
jtherD.
\ single mau lives with and sup
ports 4 mother so years of age and
wo sisters l 9and 81 years OF age,
II in good health. His exemption
81 600 as the head of fimily. Since
lis mother and sisters are neither
Inder Is years Of age nor mentally
or physically incapacitated be can
OF claim an additional exemption
for dependents.
= widoWer !: the entire support
# q cLild under Is years OF aga, out
otherwise neglects it. HIS eXemp-
ion IS 1,200. He is not the head
Il a family, an dis entitled only 10
he 5000 for 4 dependent.