The Washington herald., 1921-01-12
Income Tax
Facts You
Should Know,
CHAPTER iii.

Thousands OF letters passed in cor
respondence last year between the
Bureau of Internal Revenue and
persons claiming an exemption OF
$4,000 as head of a family. Cir
cumstances surrounding each indi-
vidual case determine largely wheth-
er person is entitled to such ex-
emption. The fixing of his status
decides, in many instances, whether
mis- income is taxable or nontaxable.
In either event. II his net income
for 1920 was $1,000 or more IL sin
gle, and $4,000 or more IL married,
he must file a return.
A head of family is defined by
Treasury regulations as "a person
who actually supports and maintains
in one household one or more indi-
viduals who are closely connected
with him by, blood relationship, by
marriage or by adoption, or whose
right to exercise family control and
provide Tor these dependents is based
upon some moral or legal obliga-
ton" A married person living with
husband or wife, in addition to the
$4,000 exemption allowed such per
sons, can not claim a $4,000 exemp.
ton as the~head of a family, ire
spective' of. the question of the sup
port Of others of the household.
Single Persons.
A single person-the term in
Guiding, widows widowers, and per-
sons nof living with wife or husband
is the head of a family II he is the
sole support of one or more rela-
tives living in the same house with
him, and IL he exercises control of
household affairs. The $1,000 addi-
tonal exemption allowed a single
person as the head of a family can
not be divided between two mem
bers of a household. A division
of responsibility for control of
household affairs" excludes both
parties from the claim. Whether a
person who does not continuously
live in the same house with depen-
dent relatives. is entitled to the So
600 exemption depends upon the
character of the separation. II a
parent is absent on business part
of the year. or a child or other
dependent away at school or on a
visit, the common home being main
tanned, the exemption applies.
A taxpayer may not be the head
of family and still be allowed an
exemption of 5000 for each person
dependent upon, him for chief sup
port IL such; person is under IS years
of age or incapable of self-support
because mentally. .or physically de-
fective. The words physically de-
fective'", refer not only to cripplcs,
but to persons defective because of
old age or i'll health. Neither resi-
dence, relationship, nor legal de-
tendency are, factors in determining
the. right OF the taxpayer to such
exemption. To, establish his claim,
the taxpayer must have contributed
during the; year more than one-haIf
Of the sum needed for the depend
ent's support. '..,.-y 49,.
Allowable Exemptions.
The following are concrete exam
Piles of circumstances which govern
the exemptions allowed the head of
family and for dependents:
A son who has left home sands
his mother more than half the sum
required for her support. He is
allowed an exemption of 5000, unless
the mother is able to- support her
self, in which case the contribution
is regarded as a gift.
SON living at home supports an
invalid mother in the same house
-hold. He is allowed a deduction of
5000 as the head of a family. plus
an additional $500 for his dependent,
who is physically incapacitated. Gt
should be noted that the 5000 addi-
tional exemption for dependents
does not apply to husband or wife,
even though either one has become
total burden upon the other.) Pc
A single man lives with and sup
ports mother SO years of age ana
two sisters 10 and 81 years of age,
all in good health. His exemption
is s2.oo0 as the head of family. Since
his mother and sisters are neither
under 1S.years of age nor mentally
or physically incapacitated, he can
not claim an additional exemption
for dependents.
A widower Is the entire support of
a child under Is years of age, bu,
otherwise neglects IL. His exemp.
tion is $1,000. He is not the head
Of a family, and is entitled only to
the szo0Sfora q dependent.
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