Evening star., 1926-02-26
TAX BILL IS SIGNED;
MOST REDUCTIONS
IN EFFECT AT ONCE
Only Automobile and Theater
Ticket Cuts Are Delayed
for 80 Days.
EXTENSIONS PERMITTED
, FOR FILING OF RETURNS
Every One Must Make Tentative
Statement, However. on or
Before March Is.


A. the 1926 tax reduction bill be
came law today with the signature of
President Coolidge, the Treasury
granted a number of extensions Of
time for filing tax returns.
The reductions afforded by the bill
became effective Immediately on all
provisions except the automobile and
:heater admission taxes, which be-
come effective in 80 days. The income
tax provision applies to last years
earnings.
Under the new regulations citizens
Gnd residents of the United States
whose net incomes exceeds $1,000 and
domestic corporations We're given
until May 10, or two months extern
sion. in which to file complete returns.
They must make tentative returns
however, on or before March 10, to-
Eether with one-fourth of the esti-
mated amount of tax.
If the estimated tax is less than
shown to be due on the completed re-
fnrn, the difference will bear interest
at per cent a year until paid back
American citizens residing or trav-
Wing abroad, including those in the
military and naval service, and all
other persons outside the United
states were given until June Is, or
Shree months extension, to file their
returns on the same conditions This
order applies to taxpayers in Alaska,
Hawaii, and other United States pos
sessions. and tentative returns will
rot be required in them
Must Have Affidavit.
However, tho return must he ac-
~ i01 Nv,
the cause of delay, and interest will
be charged at the rate of per cent
q year from the due date of the tax
until paid.
The Treasury said 1t was not con-
sidered necessary to grant an extern
sion to nonresident alien individuals
and foreign corporations having no Of
fice or place of business in the United
states, since such returns are not due
until June 10, if filed on the calendar
> year basis and not until the 18th day
of the sixth month following the clos
ing of the taxable year, If filed on
fiscal year basis.
All other returns, under the order.
must be filed on their respective due
dates unless g. specific request for an
extension is made to the local collector
Of internal revenue.
Telegraphic and printed Instructions
were In the hands of substantially all
Df the 65 collectors of internal rev
enue and their numerous branch Of
fees throughout the country today
and there was every indication that
the full benefit of the S3s7,s11 900
tax slash would he carried directly and
completely to the American people.
Response From Public.
Preliminary response from the tax
payers showed that the substantial
relief afforded Is being welcomed with
spirit, indicating. some observers said,
that the pocketbook would yawn with
more willingness for Uncle Sam
throughout the country this year than
ar any time since the World War laid
,ts heavy hand upon the resources OF
the United States.
More than half of those who have
been paying taxes to the Federal Gov
ernment will be relieved from paying
anything at all, according to latest es-
tirnates. Slightly more than 100000
persons paid taxes to the Government
during the year 1924. records show,
while under the 1926 bill this year
10000 who formerly paid will be
entirely exempt.
At the local Office of the deputy col
Yector Of internal revenue, 1922 Penn
sylvania avenue, all forms were on
hand and up to noon a number of per-
turns, 1t was reported.
Banks Will Help.
Washington banks We're making ar
rangementS to assist clients in the
making out Of returns, and the small
army of accountants and tax advisers
who have their headquarters here
were precipitated into their busiest
sea son.
Individuals and the treasurers of
countless firms throughout the coun-
try We're believed engroSsed in the
preliminary details, at least Of making
their accounting to Uncle Sam for the
past years prosperity. Many had al
ready computed the necessary figures
on income and profits, and there re-
manned only the fixing Of the tax.
Instructions went out by telegraph
supplemented by mail, to collectors Of
internal revenue last night releasing
the last two tax blanks, Forms 1040
and 1920. These are for persons with
earned net income Of more than 5000
and corporation returns, respectively.
Forms Will Be Mailed.
Forms will be mailed by the collec-
tors to all taxpayers who filed similar
returns last year. but it was empha-
sized that failure to receive a tax
blank from the Government does not
relieve the taxpayer from RESPONSE
bility of making return on time.
Explaining the slips attached to
form 1040. which was used last year.
a statement from the Bureau of In
fernal Revenue said these slips con-
tained instructions relative to the pre-
paration of returns for the calendar
year 1925, showing the normal and
, surtax rates, exemptions of $1,000 for
single persons, $500 for married per-
sons living together, $4,000 for head
OF a family. etc. The amount Of net
income which may be claimed has
been increased from $4,000 to $40, 900.
Beneath the instructions" said the
statement, space is provided for the
computation of taX'-the insertion of
figures showing earned net income,
amount of income taxable under the
normal tax and surtax rates-normal
tax, 11z per cent on the first $4,000 in
excess OF personal exemption and
credit for dependents, 3 per cent on
tho next $4,000 and : per cent on the
balance-surtax, a graduated tax Of
from per cent on net income between
$4,000 and $4,000 to 20 per cent on
net income in excess of s100, 900.
This computation of tax and the
instruction sheet should be retained
bv the taxpayer. with a duplicate copy
1.,.~ T.,