Evening star., 1932-03-01

| Is years are as follows: Total interna
915. 5.744. .44O %; total additional assess.
ments and collections resulting from
office audits and field investigations
| S5. .8O9, 81 9, $50 90: amount refunded, 81
| 345,846, 1850. This sum does not in.
clude the amount allowed as credits
i and abatements.
Q-Perhaps you would like to tell US
Just how these refund cases are
handled.
A-Small sums are refunded only
after consideration by four skilled en-
ployes; refunds of from $4,000 to $780,
600 are considered by at least five en-
ployes: from 900 to $4,000 by not
less than six employees; while cases in
volved in allowances in excess of S75,-
900 will have the attention Of not less
than eight employees, all skilled in tax
law and accounting.
The persons who pass upon these re-
funds do not all work in the same Of
fee. They are not all under one di-
rect supervision. They do not have
immediate contact one with the other.
Some of them are employees attached
to field offices: others in auditing
section of our income tax unit; still
others In the income tax unit, under
separate supervision. review the work
of the auditors attached to the section
If the amount to be paid exceeds $20,-
900. the whole record must be reviewed
in the Office of the general counsel of
the bureau.
Q.-Are these refunds scrutinized by
any authority outside the Bureau of
Internal Revenue?
A.-At this point 1t seems particu-
larly appropriate to call attention to
the further procedure in force with re-
spect to cases involving the larger
overpayments. 1t is provided by law
that no refund or credit of any income,
war profits, excess profits. estate or
gift tax, in excess of $4,000 shall be
made until after it has been submitted
to the Joint Committee on Internal
Revenue Taxation. with an accom-
panying decision of the Commissioner
Of Internal Revenue. This procedure
is, of course, in addition to the care
full examination to which the case is
subjected in the bureau. The Joint
Congressional Committee consists of
five Senators and five members of the
House of Representatives. 1t Is en-
powered not only to investigate re-
funds, but to investigate the admin
istration of internal revenue taxes.
The Commissioner of Internal Rev.
enue is required by law to make re-
port to the Congress at the beginning
of each regular session showing the re-
funds paid in excess of $500. Although
the decisions in individual cases are
made public from time, to time. the
grouping of refunds in the report sub
mitted at the beginning of each reg
ular session of Congress usually
attracts more attention and gives
rise to many of the inquiries on
refunds In considering this report it
should be kept in mind that it in
cludes refunds based on final judg-
ments of the courts and OF the Board
of Tax Appeals as well as those grow
ing out of the application OF these de-
cisions to other cases.
Q.-Mr. Commissioner, the Bureau OF
Internal Revenue has done big job
during the last year in Chicago. Now
that some of the leading characters
are temporarily removed from the lime
light, can you give us an insight OF the
inner workings Of the bureau in such
cases? For example. would you OF
your bureau direct that agents be sent
to Chicago to get Al Capone?
A-Certainly not, if you mean in the
sense of getting your man, or making
a case, regardless OF circumstances.
The agents were directed in this case.
as in all other cares, to conduct a
careful investigation to determine
whether the taxpayer had taxable in
come and whether the proper taxes had
been paid. If it had been determined
that taxes had not been evaded. the
investigation would have been promptly
closed.
Q.-Mr. Burnet, the press has re-
ferred to an armys of Government
agents being engaged in Chicago. Did
you send an army to secure evidence
against a single taxpayer?
Al cannot speak for other branch
es of the Government. In so far as
the Bureau of Internal Revenue Is con-
cerned, it was believed that the case
was fragrant violation of law and that
unusual obstacles would have to be
overcome because OF the business meth
ods Of Capone. So the investigation
was referred to experienced agents
familiar with the tactics of this class.
The major part of the investigation
was handled by seven agents and COW
cred a period of about year and
half The seven agents during that
period not only investigated the case
against AL Capone, but also made in
vestigations relating to other gangsters
which resulted in several convictions
and pleas of guilty.
Odd the Government receive any
indirect benefit or additional revenue
in the form of taxes as result Of
these Investigations, other than the
taxes collected from the persons actually
investigated?
Am one collection district, where
this phase Of the situation was looked