The Brunswick news., 1921-12-18
Married Men With $4,000 Net
Earnings and Two Depen=
dents VIII Pay sos.
IT'S A DROP FROM LAST
YEARS FIGURES OF SIO4
Exemption For Head of Family
of So, With $4oo For
Each Child or Other Helpless
Person is AIIowed.-Many
Changes Are Noted.

The enactment of the Revenue act
has resulted in a flood Of letters to
collectors of internal revenue con.
cerning the workings of the income
tax under the new law. These deal
largely with questions of exemptions
and deductions under the Revenue act
of 1921 compared with the act of 1918.
David Fl. Blair, Commissioner of
Internal Revenue. has ordered Sc
ries of Informative articles telling the
taxpayers in detail how to make his
returns for this year, which are due
March Is.
Probably the most important
change affecting the man of moder-
ate means" said statement yester-
day is in the exemptions. Under
the 1921 act married man with net
income Of $4,000 and less is entitled
to an exemption Of s2,500 Under
the Revenue act Of 1918 this exemp-
tion was limited to $4,000. The Reve-
nue. act Of 1921 also provides for each
person dependent upon the taxpayer
iii such person is under is years Of
age or incapable of self-support be-
cause mentally or physically defective
IAN exemption Of s4OO. The exemp-
tion under the Revenue act Of 1918
was $500 for each such dependent.
Thus. a married man with two depen-
dents whose net income for 1921, was
$4,000 will pay this year a, tax Of $6S.
compared with sl0f on tie same IN
cofne for 40
"A head of family, as defined by
present Treasury regulations, IS a per
son who actually supports and main
talns IN one household one or more in
dividuals who are closely connected
with him by blood relationship. rela-
tionship by marriage or by adoption
or whose right to exercise family con
troll and provide for those dependents
is based upon some moral or legal
obligation.
"The normal rate of taxi per cent
on the first $4,000 OF net income above
the exemptions and per cent on the
remaining net Income remains un.
changed This applies to citizens and
residents OF the United states. Alien
non,residents are taxed 70 the full S
per cent on income received from
sources within the United States
Nonresident aliens are allowed only
single personal exemption OF 81 600
TO overcome the disparity In the
amount Of normal tax In the case OF
! two taxpayers. one OF whlm is just
within the lower $4,000 exemption. the
other being Just within the higher
/ ss500 exemption. the act provides
that the reduction OF the personal ex
emptIon from S2,500 to $4,000 shai
] not operate TO increase the tax which
would be payable II the exemption
were $4,000 by more than the net IN
come in excess of $4,000. For exam
pie. a married man or head Ct a fam
ily has net income for 1921 OF 5000
Assuming that he has no dependents
| his tax, II ne We're allowed only the
$4,000 exemption would be $1,000
Under the Blair provision. however
with two dependents on the amount
Of his taxable income of $4,000. oi
lander at the head. The new owners
/ slo0 plus the amount ny which his ne
income exceeds $1,000
MANY Inquiries are received rpla
tive to the surtaS rates. Taxpayers II
the preparation 81 their retnrni
should be careful to note that the sur
tax rates for the calendar year 1872
remain unchanged. The surtax rate
Il on incomes for ls2t RANCE from I pc
cent on the amount ot net income be
tween $4,000 and 5000 GO SIS per cen
on the amount OF net income ia eS
4 cess of 81. 600 GOO. For the ealeuda
+ year 1929 and each calendar yea
J thereafter the surtax ranges from
+ per cent on the amcunt ol net incom
between $4,000 and sIeo00 to 50 pe
!. cent by which the amount of net IN
come exceeds $500 coo.
4 Returns are required og every sin
u gle person whose net income for t92
i was 81 600 or over. every married PEI
son not living with husband or VII
whose ret income was 81 ooo. and -