The Wrangell sentinel., 1943-01-15
WHAT -Is INCOME TAX?

week until completed.
 WHAT IS INCOME TAX?
 The federal income tax is, as the name implies a tax levied upon in comes, and it is payable in relation to the amount of income. Income. for Federal income tax purposes, means in general any compensation for ones services, whether the compensation be in money or in goods or other services; it includes also the net value received for the product of ones labor, as farm produce in the case of a farmer' income from investments; profit from business operations; and other gains from sales and exchanges of goods and property Certain limited categories of income are, however, tax exempt, and to the extent of such exemptions are excluded in computing the tax. Because of exemptions from the tax given to persons having less than certain stated amounts of in come, as well as because of Yari- ous deductions and credits allow able. only a small proportion of the number of persons receiving in- come have until recently been sub ject to the tax. Thus, of the estimat- cd 5 million persons in the country whO receive income in one form or another during the calendar year 1Jt1. only some 26 million persons were required to file Federal in come tax returns for that year, while of these same 26 million. more than million were not tax d la due to credits and deductions allowable
 As a result of the lowering of exemptions many more persons are now subject to the Federal income tax than before, and for the calen- dar year 1942 it is estimated that more than 3 , million persons will file Federal income tax returns. To the large number of persons now subject to the Federal income tax, who have never reported income be- fore for Federal tax purposes, an understanding of the law and ap- plicable regulations is of prime i'm portance
 An income tax return is de- elaration on the part of the taxpay- CT of his total taxable income for the year, together with the various deductions, exemptions, and credits to which he is entitled It is in re- liance upon voluntary disclosure, and the integrity of taxpayers gen. orally, that the cost of administra- tion of the income tax can be kept at a minimum though the return is a voluntary statement, any per son who willfully makes a return which he does not believe to be true and correct in every material matter is subject to the penalties provided by law.
 The first requirement of the law is the filing of an appropriate re- turn. For individuals generally, this must be done by March Is fol- lowing the end of the calendar year. The return must be filed with the appropriate Collector of Intern al Revenue for the district in which is located the legal residence or principal place of business of the person making the return.
 Under the present law every single person, and every married person not living with husband oI wife, having a total income learn ings, together with other income of $500 or more, and married p%'' sons living with husband or wife throughout the taxable year, who have an aggregate income (tota earnings of both husband and wife together with other income) oi $12O0 or more, regardless of tht amount of net income, must file z return.
 FORM OF RETURN
 Persons subject to the Fedora income tax must report their in come to the Government on forms or blanks, prescribed by regula lions. These forms are obtainabl from any Collector of Internal Rev 6nue, and generally from any bank Special forms are designated fo corporations, for partnerships, fo trusts and fiduciaries, and for non resident aliens. Farmers who keel no books of account on the accrua method must attach a special sched nle to their return (Form 1040Fsl For individuals two forms ar