Evening star., 1924-01-12
.UNEARNED INCOME
PLEAS ARE VOICED
Pathetic Stories From Help
less Persons Who Live on
Investments Received.
BY DAVID LAWRENCE.

Congress is beginning to hear from
the country on the subject of earned
incomes as contrasted with unearned
incomes.
Widows, orphans, invalids, pension
ers and others whose main source OF
! income is derived from investments
are asking that they be given the
same 35 per cent reduction as would
be granted under the Mellon plan TO
the wage-earner and salaried indi-
! vidual.
Senator Smoot, chairman of the
Senate finance committee, feels sure
that before the tax bill Is finally
adopted some amendment to take care
of those who would be affected by the
unearned income question will have to
be inserted.
Letter From Woman of Eighty.
The viewpoint of the unearned in
come class Is expressed to some ex-
tent by letters like the following.
which came from a woman eighty
years old
II am eighty years old l can do
several kinds OF work quite we'll. but
nobody will hire me-and l don't
blame them. ! inherited some money,
the income from which enables me
to live In a modest way. / began to
earn my own living at the age of
fifteen and continued until l was past
fifty. Since that time my income has
been an uncertain amount, sometimes
so small that I have been obliged to
use my principal for current expenses,
which. of course, permanently reduced
my income. Right now I am wonder
ing il ! shall have any income this
month, the money due January / not
! having materialiZed.
AT dinner tonight l shall meet q
vigorous young woman who earns
her living as principal of a grammar
school and whose income is more
than mine ever was and who can re-
tire on pension (Which is sure
!thing), when she is sixty. Just why
should she be excused by twenty
five per cent on the payment of her
income tax?
THE government seems to give so
much attention to various classes OF
lpeople-farmers, merchants, children,
labor unions, etc. Does 1t ever con-
/? They are singularly helpless and
may be wholly useless and therefore
not worth considering"
Affects Large Class
The complaints from others who
are in the unearned income class
range from the widows who have
families to support out of the In
come of life insurance bequests to
invalids and other dependents who
live on funds either accumulated by
them when they are able to earn
their own living or invested for them
by others.
The situation can be cured in large
part by the adoption of an amend
ment which would place all persons of
the unearned income group who re-
ceive amounts up to five or seven
thousand dollars a year in the same
category as the earned income group
namely. making the 25 per cent re-
duction apply to both. This. OF course.
might have to be limited only to those
whose income tax returns show that
this income is their only means OF
support, because otherwise II might
operate as a 25 per cent reduction on
the first five or seven thousand dol
lars received from investments by
those who are we'll able to pay a
sources of income.
Some talk Is being heard about
limiting the 25 per cent reduction on
earned incomes only up to and includ-
is not. of course. predicated on the
idea that 1t is just for one class of
earned income to be distinguished
from another, but simply on the the
ory that persons above $4,000. even
though they use physical or mental
energy instead of money capital. can
afford to pay the higher tax. The OBJ
jections to this will be numerous, no
doubt, as it will be called a tax on
brains and a destroyer Of incentive
The Treasury has given no indication
as yet that 1t will approve any of the
amendments suggested either for the
earned or unearned income groups
but some modification will surely be
made in either the Senate or House.
Downright 1924