The Madison daily leader. [volume] (Madison, S.D.) 1890-current, 1922-03-01
HOW To FIGURE
UP INCOME TAX
COLLECTOR JENSEN TELL S
WHAT CONSTITUTES INCOME"
UNDER MEANING OF LAW.

Aberdeen, March Leslie Jen-
sen, collector of internal revenue for
South Dakota, today issued the fol-
lowing statement:
In filling their income tax returns
for the year 1921, taxpayers must
remember that taxable income is not
necessarily cash. Where services are
paid for with something other than
money, the fair market value of the
thing taken in payment is the
amount to be included in income.
For example, the value of merchan
disc received by clerk of a grocery
store as part payment for his services
must be reported as income. Com
pensation paid an employe of a cor
poration in shares of stock is to be
treated as If the corporation sold the
stock at its market value and paid
the employe in cash.
Promissory notes received in pay
ment for services and not merely as
security for such payment constitute
income to the AMOUNT of their fair
market value. Living quarters and
meals furnished as compensation for
services are to be reported as In
come. A hotel clerk given a room
and his meals as part payment for
his services is required to report as
income the amount he would have
to pay for board and lodging else
where.
The value of quarters, light and
heat furnished army officers, wheth-
er stationed at an army post or paid
from funds allowed for such purpos-
es when officers are stationed else
where is taxable income in an
amount equal to the cost to the gov
ernment of furnishing such quarters,
etc. Where an officer or enlisted
man is allowed certain communication
in lieu of quarters, light and heat,
the entire amount received for such
purposes for the taxable year must
be included in gross income.
Where living quarters, food,
clothing, etc., are provided for an
employe solely for the convenience
of an employer, the value thereof
need not be included in the income
of the employe. For example, where
because of the location and nature of
the work, it is necessary that en-
ployes engaged in fishing and can
ming be furnished board and lodging
by the employer, the value OF such
board and lodging may be consider
ed as contributed for the convenience
of the employer. Board and lodging
furnished seamen in addition to their
other compensation is held to be
furnished for the convenience of the
employer and the value thereof need
not be reported in the returns OF
such employees. Uniforms, rations
and medical or hospital service af-
| forded enlisted men or seamen need
not be reported as income. These
are furnished by the government foi
| its own purposes. and are not com
pensation for services.
| The value of board and lodging
furnished employees of hospitals al
part compensation for services is te
be reported as income. If, however
i du GuQlOyC vi q hOoPhtoi 40 oopJN~'
/ t oimmediate service on demand al
any time during the "a hours of the
daily, and on that account is Obliged
to accept quarters and meals at thu
hospital, the value of such need no
be reported as income. If the EN-
ploye is on duty a certain number o
hours, and could, ii desired, Obtain
meals and lodging elsewhere than a
the hospital and at the same tim'
perform the duties required of him
the ratab'e value of the board AM
lodging furnished him Is consideret
additional compensation.
The value of quarters, subsist
ence, laundry, heat and light furnish
ed officers and employees of the pub
lie health service constitutes incom
and must be included in their re
turns for the year.
To avoid penalty, returns must b
filed on or before midnight of Marc
15.