The Sauk Centre herald. (Sauk Centre, Stearns County, Minn.) 1886-current, 1934-02-01
Minnesota's New Income
Tax Law Effective Now
Single Persons Earning Over
$1,000 Per Year Will
Be Affected

Citizens of Minnesota are realiz-
ing that they face within the next
go days, a new expense-the state
income tax.
With it's enforcement this year
for the first time, Mr.. Citizen will
meet a set of complex difficulties
such as he meats each year in con-
nection with the federal income
tax. The difficulties on the state
income tax, however, are not ex-
actly the same as those on the fed
eral levy.
And the chief difference is that
in the case Of the state income tax,
there is no provision to send him to
Jail as there is under federal laws,
for violation of the measure.
On his taxable income, Mr.. Cit
izen will now pay the state a grad
uated percentage, ranging from 1
per cent on the first 81 900 up to 5
per cent on all over $4,000. Tax
able income, however, Is computed
after exemptions which in case of
the state act are considerably more
liberal than those allowed in the
federal laws.
Returns must be made on the
state income tax by March Is to
the office of the Income Tax divis-
ion, State Tax commission.
The tax is payable in two INSTALL
ments, the first at the time the re-
turn is made and the second six
months later.
Each single person is allowed an
outright exemption of $1,000. Each
married person or head Of a house
hold is allowed exemption of $4,000
and $3.50 more for each additional
dependent.
Where both husband and wife
have an income, either may file a
return for both, and claim the ST.
600 exemption, or each may file a
separate return. In the latter case,
the $1,000 exemption may be claim
ed by one or the other, or it may
be divided between them, but each
may not claim the $1,000 exemption
of single persons.
The return must show as gross
income, all salaries, wages, COM
mission, fees, or income from bust
ness received; rent received from
porperty in Minnesota; royalties
from patents and copyrights, pro-
fits from sale of securities, per-
sonal property or Minnesota real
estate; distribute share of partner
ship profits. merchandise taken
from stock for family use; income
from estates, trusts or other fidu-
Charles, and any other income re-
ceived.
From this total of gross income,
Mr.. Citizen may then calculate his
net income by making allowable de-
auctions. He may deduct all taxes
paid except income taxes, local ben
efits, and inheritance and estate
taxes.
He may also deduct all interest
paid, on any type of obligation, but
must itemize these payments in his
return. He also may deduct four
types of losses suffered during the
year. These include losses on sale
of securities, personal property or
Minnesota real estate; losses from
business or profession; losses from
rental Of Minnesota property, and
losses from distributive share of a
partnership.
The next deduction allowable is
"other ordinary and necessary ex-
penses." This gives Mr.. Citizen the
best break of any in the act. I'm
der it he may deduct his rent, any
salaries he pays out, payments to
unemployment insurance and PEN
sion funds, and also payments Of
the necessary expenses of sickness
and accidents.
On the other hand, payments to
him of insurance compensation or
damages for sickness and accidents
are exempt, as are payments of life
insurance policies or others.
If Mr.. Citizen is in business, he
may deduct bad debts charged off
during the year and a reasonable
amount for depreciation of prop
erty used in his business. If he
owns mine, standing timber, or
similar natural resource, he may
deduct a reasonable amount for it's
depletion.
He may not, however, deduct
family or personal living expense,
capital improvements, requirements
on property, premiums paid on life
insurance, or shrinkage in market
value Of property.
If Mr.. Citizen Is in charge Of a
corporation, partnership, or Of an
estate, trust or other fiduciary, he
must make out returns for these as
well as his personal returns.
Failure to make proper returns
or to pay state income taxes sub
jects taxpayers to various cash pen
alties and legal actions, including
seizure Of property, but does not
involve criminal prosecution.-Park
Region Echo, Alexandria.
READ TIL HERALD FOR NEWS