Milford chronicle., 1926-12-24
SUGGEST CHANGES In
STATE INCOME TAX TO
GREATLY CLARITY LAW
continued from hrst page)


clear that income derived from prop |
erty acquired by gift, beQuest, devise
or descent is taxable.
Exemption, according to the new
nrovisions, could be divided by hus-
hand and wife in any manner they
cboose. The words head of family,
are defined to mean one who main
tains a dwelling house or apartment
for the use of himself or herself ana
another or others who pay no rent CT
comnensations for their accommoda-
tiOn. Joint returns by husband ana
wife would be definitely prohibited
Inv the revision of the law, which al
so holds that federal import duties
are held to be a tax paid to the Uni
ted States and therefore, deuuctlDle'
A new provision allows deductlon
of contributions to Delaware chaIle
ties I'D to the limit of 10 per cent Oh
the +axnayer's net income. 1t follows
Federai practice in part. An allow
ance for depreciation in property
value is made.
Tosses incurred in the operation Oh
forms are made deductible in the
changes but from the profits derived
from such operations only Deprecla-
+ion of farm buildings may be IN
cluded in charges against tarm op-
erations. No household or personal
evnenses of the owner or manager
wouId be allowed to be charSeu
against operations. -
In the draft a taxable Is nnaue II
able for penalties whether MS le-
turn was filed personally OF ny an
other on his behalf.
A new provision eXempts perSonS
nartlv dependent for support ana IN
canable of earning a livelihood. SOL
diers of the United States Army sta-
toned in Delaware, are not taXaDIei
the draft points out.
It is provided that all persons eA-
empted from the payment OF TAX VI
fiIing fee shall make a report on Ol
before February Is, or shall be Il
obIe to pavment of tax or ming zee
inmates of prisons, ETC., are not ol
that account exempted from pay
ment of filing fee or tax.
It is pointed out in the proposes
CHANGES that the proper wordlng 0
tbe Corporation Invested Capltd
Tax law is one which requires mucI
thought. The revenue from 1ncorpor
ating companies in Delaware Is sup
stanfial. it is explained, and shouI'
he safeguarded. On this account COZ
oora+ions not engaged in active Dus
mess in Delaware have been prop
erlv EXEMPTED in the changes.
Attention is paid to the corpora
- I-,,o,,-,, nc "family companies.
In regard to these it is stated ina
securities owned by Delaware col
norations and kept in the State ar
not classed as capital USED anu ~ ~
vested in the State. Practlcally &
Of the remaining corporations d
those that are using capital IN Dela
ware for the purpose of making Pre-
fits and it is this capital that IN
Invested capital" tax seeks, ID
draft says. 81, oo
Tn defining taxable capital, goo
will natents, processes and Lrao
,norks are included specifically an
the wording of the paragraph Nc
heen changed to make it more clea
new provision makes plain tn'
debts of corporations deducted Il
determining taxable capital are I'm
tied to obligations maturing wltnl
the tax year and do not include ca
loans and reissues of obligation
The object of this provision Is
nrevent offsetting capital useu
and invested in Delaware with Don
ed or other debts which are Feal
part of the capital structure. -
The corporations exempted ITO
taxation are required to make a.
nual returns and pay the hllng Il Il
of SO. This provision will enable u
tax officers to complete registrat'
of corporations and require a stat
ment of cause of non-taXibllIty i
every corporation before eXemptl'
is granted. The filing fee is require
of all persons and corporations e
cepting those specifically exempte
Returns must be signed by the pc
son making the return or by tho
acting for him. The signature mu
he the full name or names ana
married woman should give her oV
name and that of her husband ais
Failure to file a return or pay a u
shall be deemed a fraud and the pc
alties provided for fraudulent T