Evening star., 1924-11-02
BY /. A. FLEMING.


to last years income tax and to all
future income taxes will stand until
the law is repealed or amended
further.
Those paying their 1928 income
taxes on installments will be relieved
entirely of the fourth quarter. this
representing the cut of 25 per cent
IN taxes. Those who paid in full on
March Is of this year will receive
refund of - per cent.
In the new schedules there is moth
ing that will give anything IN the
way of real satisfaction to the single
man or woman or to the married
man or woman not sufficiently con-
genial TO live together in harmony
or ot therWiSe other than the reduc-
tiou in taxes.
Th" exemption of the man or wife
living together is increased from
$1,000 to $2500. while for each child
under Is years of age or dependent,
an additional exemption of S40O Is
permitted.
The single person, or the man or
wife separated. pays on income after
the $1,000 exemption. on the first
81 600 he or she will be called upon
to pay . per cent, which will be a
reduction from the per cent normal
tax heretofore on the first $4,000 of
taxable income.
Married or Head of Family.
The married person living with his
partner in life will claim his $500
exemption. plus other exemptions for
children or dependents related by
blood or marriage" and then both
married and single are treated nearly
alike.
on all additional income, great or
small. there will he an additional
tax: that is. after exemptions and in
th. ease of those entitled to it on
the first $4,000 of net income. the
taxpayer will be called upon to pay
= normal tax of per cent. instead
OF the S per cent obligatory under
the old law.
Surtaxes do not begin until the
taxpayer has S10.500 of taxable net
income. so that the average rank and
file of workers find no bugaboo in
the surtaX.
side Issues introduced.
There are a number of side issues
introduced in the new revenue act.
in endeavoring to get" the possessor
of "unearned" income, the law diff
ferentiates between earned and un-
earned. but this provision is rally
without much effect way the
other.
\ worker with a $4,000 taxable net
credit of $3.50 on his payment of
normal tax. on $4,000 net the credit
will be $50 and from $1,000 net tax
able income up to $l,000000 the
credit for the taxpayer will be but
$3.50. This applies to all taxpayers.
The maximum credit is but S75, SO
that it really cuts but little figure.
All income was earned some time
the principal that produces the inter-
est or dividend money or the cash
that was received for the sale Of
property. This feature of the new
tax law may be passed upon as of
small Importance.
SurtaN Start at $1O,5OO.
The surtaNes. stated before
start on S10.500 of net taxable in
come. The former sch hedule of sur
taxes started at $4,000 net taxable
income. reaching 40 per cent at $500
600. Now the new rates are 1 per cent
on amounts in excess of $4,000 net
income, and increase l per cent in
brackets of $4,000 and $4,000 up to
100000 and there after in brackets of
100000, $500. 900 and 100000 up to
IS per cent for s250.0O0 and to 40
per cent for sl,0OO,OO0. And the mill
ION dollar taxpayer gets a credit of
Sl2.50 for his earned income Just the
same.
When you have completed your
computation on your taxes on this
basis there are a few side issues that
Will make some difference to you.
issues which VIII not make so very
much in the aggregate for Uncle
Sam.
Some New Proyixions.
A single person, in the meaning of the
law. is entitled to an exemption of
$3.50 when his taxable net income
Reaches $40 Ha n
when his net taxable income is between
SAo0o and $4,000 and add per cent ad-
dltional. He may deduct $50 80 when it
i between $500 and 50, coo: also credit
S22oO plus per cent when il is be-
tween $1,000 and $500, and $22 so when
between $500 and $1,000; also l1a per
cent OF the amount by which the net
taxable income is in excess of $1,000
and between $1,000 and $4,000.
Nor is this all OF the troublesome
variation in the general law of which
many taxpayers will never take ad-
vantage and which will not yield much
return to the Government, where the
advantage is on it's side Of the balance
sheet.
Where there are dependents other
than husband and wife or children, as
defined by law, there is reduction of
al in the tax on a net income of more
than sS. 600; of Sic where the tax Is on
less than $4,000, but not under $4,000,
and IS, where the income is less than
$1,000.
In the Matter of Dividends.
Income from dividends is exempt from
the normal tax entirely and becomes
taxable only in the surtax brackets.
When it comes to selling and buying
back stocks or bonds as an almost
identical operation for the purpose of
showing "A loss an interval of 30 dayS
is required to legalze the operation in
stead of the simultaneous movements
as formerly.
Corporations received scant con-
Sideration. They still pay II per cent;
are not -ntitIed to retroactive fea-
lures; have been given heavier
penalty on profits accumulated to
avoid surtaxes. They are subject to
capital stock tax and to all the statu-
tory provisions of the act.
The entire tax measure is full of
"specialties." Debts allowed must be
contracted by expenditure of money
or moneys worth; deduction may be
made for gifts to fraternal societies
or organizations, subject to the new
gift tax law. when made within five
years prior to the death of the giver
Charitable beduests are deductable as
before.
Tax Law on Gifts.
II you are an American citizen and
give away $4,000. you need not worry
about the tax thereon. but if you, in
your generous moods, get gay and in
crease the donation to $51 900 or to
100000 you will be called upon to
give the Government per cent of the
amount so shifted from income tax
provisions. If you give away $1,000,000
you will have to give the Government