The Barre daily times. (Barre, Vt.) 1897-1959, 1921-01-24
INSTRUCTION ABOUT
INCOME TAX RETURNS
Each Single Person Receiving $1,000 or
More and Married Persons Re-
ceiving $1,000 or More
Must File Re-
turns.

Must File Re-
turns.
Due in the majority Of cases, to mis-
understanding of exemptions, NOR
than 10000 persons last year were as
sessed nominal penalty of from s
to $40 for failure to file an income ia,
return for 1919, although their in
come for that year was not taxable.
Note These Points!
The revenue act provides a persona
exemption of $1,000 for single persons
So, 600 for married persons and heads o.
families, and an additional exemption
of $500 for each person dependent upor
the taxpayer for chief support, if sucf
person is under Is years of age or in
capable of self support, The delin
quents last year were persons whose
incomes exactly equalled the amount Of
the allowable exemptions, and who con.
sidered it unnecessary to file return
and others whose income, because OF
dependents, was non, taxable, but who
nevertheless were required by law to
make returns.
| The bureau of internal revenue
therefore, this year is emphasizing the
fact that the requirements to file a re-
turn are based solely on a person s
marital status or the amount Of his or
her income for 1920 Single persons
with an income for 1920 of 81 900 or
more and married persons with net in
comes of $1,000 or more must file a
return regardless of whether their in
comes are non taxable.
Returns of Married Persons.
The exemption of $1,000 allowed mar
ried persons applied to the combined
income Of husband and wife, to which
must be added the income of depend
ent minor children. A common error is
for both husband and wife to claim
exemption which is designed to cover
essential living expenses. This exemp-
ton may be claimed by either or may
be apportioned between them as they
may elect.
If the income of either husband or
wife for the year, 1920, was more than
$1,000, each should file separate re-
turn. This is for the purpose of com
putting correctly the surtax on income
in excess of $1,000, which applies sep
arately to the net income of husband
and wife, and not to the combined net
income.
The surtax rates, which apply only
to net income in excess Of $1,000, are
combined income of $4,000 the tax is
sonal exemptions. Many taxpayers
make the mistake OF computing tax on
the combined net income of husband
and wife, to their own disadvantage. As
illustration, in the case Of a husband
whose net income was 1900 and that
OF his wife $4,000, the total normal
and surtax, if the incomes were com
bned would amount to $3.50, whereas
if computed on the income of each
would amount to only $3.50.
Computed Separately.
In the first instance, deducting the
exemption of $1,000 from the
combined income og $1,000. the tax is
on the remaining $1,000. At the rate
of four per cent on the first 81 900 and
eight per cent on income in excess Of
that amount the normal tax amounts
to S400. The surtax, which is .comput-
ed without the benefit Of the personal /
exemption, amounts 10 $50, which is 1
one per cent on the amount of income
between So ,0O00 and $4,000. two per
rent ON the amount of income between /
SO 900 and $1,000, and three per cent on 1
The amount of income between So 900 \
and $4,000.
If computed separately, the husband /
may deduct the personal exemption OF \
b. 900 from his income of 81 900 and +
IN the remainder pay a normal tax Of I
$40, being four per cent on the first
81 900 and eight per cent on the excess.
His surtax amounts to $780, being one
ser cent on the amount of his income !
between $4,000 and 81 600 The wife re
elves no personal exemption, and her
,ntire income of $1,000 is taxed at the
ate of four per cent, being less than
1900. The husbands tax is $40 and
he wife's $50.
Exemptions Not for ALL
Not every married person is entitled
o the $1,000 exemption. The claim is
dependent upon whether man and wife
ire living together within the meaning
Il the revenue act. In the absence Of
continuous residence together, whether
man or woman is living with wife or
husband depends upon the character OF
he separation.
II occasionally and temporarily the
wife is away on a visit or the husband
5 away on business, the joint home be-
ng maintained, the 81 1000 exemption
.pplies. Unavoidable absence Of wife
r husband at a sanatorium on account
i illness does not preclude a claim for
he exemption. II. however, the hus
and voluntarily and continually makes
= home At one place and the wife at
mother. they are not living together
within the meaning Of the income tax
avs regardless of their personal re a
ions In case Of separation BY mutual
greement each must make a return II
ncome Of 81 600 or more The same
ule applies in case Of divorce or legal
eparation. A maid or widow not the
cad Of a family and without depend
nts is entitled only to a 81 900 exemp-
ion.
The status Of a taxpayer on the last
Az Of the taxable year determines the
mount Of his exemptions If on Dec
Z Tng0 he Has married and fiyf-e