The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1921-01-27

~ been made by the treasury de-
u partment upon a phase of the
income tax that will not only
save thousands of dollars to residents
OF Idaho in the payment of future
taxes, but will also entitle them to a
refund of other thousands already
paid, assuming that the department
decides that the ruling is applicable
under the Idaho law. and it is impos-
sible to see how it could be held
otherwise. The ruling was made on a
case from Texas and is based upon
the community property law of that
STATE under which husband and wife
have equal rights to the income earn
cd or derived from. any source by
either. 1t has therefore been held
that the earnings of husband and
wife and the revenues from their
community property and separate per-
sonal property are community in
come; that the husband and wife in
rendering separate income tax re-
turns may each report as gross in
come half the total, (a) earnings
of the husband and wife; 90 income
come from community property"
Idaho has the community property
law to which this ruling refers. and
families in which the taxable in
come is more than $1,000 will save
money by having returns made by
husband and wife. each for ne-half
of the income and those who have
made single returns for former years
on incomes above $4,000 may submit
individual returns and the party maxi
ing the first return may apply for a
refund of the difference
Practical Operation
TO illustrate the operation of the
treasury ruling in Idaho and other
states having the community prop
erty and income tax law, suppose that
husband and wife have a taxable in
come of $4,000 and the husband
makes the return for the full amount
he would pay the following amounts:
Normal tax on $1,000 at per
cent ..... ....-...........................
Normal tax on $4,000 at s per
cent - - 10000
Surtax on $1,000 per cent on
first $1,000, . per cent on next
$4,000, per cent next $1,000 1000
Total tax .............. $4,000
Now. take the same income and let
he return be made by both husband
md wife, each accounting for half I'M
Ter the community income law:
Formal tax on $4,000 at per
Normal tax on $1,000 at per
cent ........ -.-.............-.-........ 5000
Total tax for husband $4,000
same amount for wife m $4,000
Total for family $4,000
The difference between this
mount and the tax paid on a single
eturn is $40 and a husband or wife
f Idaho who has made a single re-
urn on a corresponding income or
ny income above $4,000 will probably
e able to recover a refund upon maxi
lg returns by both husband and
life and making the application for
he difference.
Ruling on Idaho Law.
Upon hearing of the ruling i'm the
exas case regarding community in
ONE, a resident of Wallace request
4 Lewis Williams, collector of in
,rnal revenue for Idaho to send him
)rms for application for rebate I'M
er the Texas decision. Mr. williams
splied that under orders from the
apartment he could not receive such
publications., but added: "The Idaho
w is under immediate consideration
y the bureau and decision will I'M
lestionably be reached in the near
Iture when of course it will be per-
issible for you to file the amended
turn and claim. should the decision
the honorable commissioner be
-vorable to the taxpayers of Idaho"
The Texas Decision.
Following is the decision of the sec
,tary of the treasury in the Texas
Use: "The following procedure has
zen approved with regard to amend
returns and claims for refund.
edit or abatement under the ruling
'ntained in the preceding para
aph with regard to community in