The Waterbury Democrat. [volume] (Waterbury, Conn.) 1917-1946, 1944-03-01
BY S, BURTON HEATH


ny s. BURTON HEATH
NEA star Correspondent
In computations which I have
worked out to demonstrate the
effect of special provisions for serv-
Ice men and women, Mr.. and Mrs,
Johnny Doughboy can make con-
siderable saving on their income
taxes this year by filing individual
returns.
Let's say that when Johnny was
drafted early in l943, he was work.
ing for $50 q week. His employer
gave Mary Doughboy q $35 Job.
She began work March 20, and
Johnny reported for induction April
While Johnny was working, his
employer deducted $29.40 In Victory
tax, and from Mary's pay he de-
Quoted SASS in Victory and $40
In withholding taxes.
The Doughboy have l2-year old
son, and Mary has q savings ac-
count which earned $l0,4l interest
during 1913.
Before he was drafted, Johnny
spent $32.l4 on deductible business
expenses; and after she went to
work, Mary spent $l8:03. During
the year, Johnny paid 1924 in de-
ductible taxes and Mary $33 90;
Johnny gave $1,000 to church and
charities and Mary 500.
PAID JOINTLY LAST YEAR
Last year, on 1912 income, the
Doughboys' Joint return showed
liability for $26653, Of which they
actually paid $l33,27. In September,
Mary estimated their liability on
Joint basis, and paid $50 against
the tax she thought they would
owe at the end OF the year.
Space does not permit complete
reproduction of the three returns
"a Joint form, done experiment.
ally to see what It would show,
and individual forms which john
ny and Mary will file to save
money.
But II you like puzzles, you can
get some forms and work It out.
You will find that on a joint re-
turn, Johnny and Mary must pay
Uncle Sam $35,07 on top Of what
they already have paid. At least
$500 has to be paid March IS,
which Mary may have TO take out
OF savings.
But on individual returns, Mary
can claim q refund Of $78.5l and
Johnny can claim refund OF $24,76,
Instead OF paying the Treasury
$35.07, they can collect o total OF
$l03.27. The difference, saved by
using individual returns, amounts
to $l38.34.
SHE USES EXEMPTIONS
Here Is how 1t works:
Mary's Income Tax net income
Item ls) Is $l,SSs45, and her VIC
tory Tax net income utem l9) Is
| $l394.38.
She claims credit for the de-
pendent son, whose support came
from her during most Of the year,
and she takes $988,45 out OF the
81, 200 personal exemption. This,
with $3.50 for q dependent, wipes
out her taxable income down aS FAR
as Line 10, Victory Tax. That
amounts to $22,34.
But the $40s6 deducted by her
employer and the 500 she mis-
takenly paid September IS total
$l0085, which pays the Victory Tax
and leaves her claim for refund
Of $78.5l.
Johnny's Income Tax net income
(Item i8) Is $78s,l2, and his Vic
tory Tax net income Qtem lO is
$s0786. He has no dependency
credit, but Mary has left him
$2ll.55 out Of their personal exemp-
ton. This brings his surtax net In
come Cline ~ down to $676.57 and
his Normal Tax net income after
deducting earned income credit
Cline y down TO $497,76.
Johnny's normal tax is $2987'
his surtax $74.95 and his Victory
tax $56l-a total Of $ll0,3S.
Thus far we have done little
more than split up the figures IN
two directions. Now We can begin
to have for Johnny and Mary.
On the joint return, the l942
tax--$266.53-was bigger than the
l943 tax-$l28.25. Three-fourths OF
the smaller l943) tax was forgiven.
The remainder, $s2.O6, had to be
added to the l942 tax, $266.53.
But on Johnny's return, because
he Is In the service, the l942 tax
Is recomputed, eliminating his en-
tire l942 salary, and that reduces
the 1912 tax to TO-"
Therefore the unforgiven tax
($27.58 for the individual return)
Is added, for Johnny, to the l943
tax instead of the 1912 tax, max
ing his liability only $l37.9l.
Already Johnny has had $29,40
deducted and has paid $l33.27
against his 1912 tax, which now
has been eliminated.
The Treasury owes him the dif-
ference between the $l62.67 they
have collected from him and the
$l37.9l he actually owes.
Therefore Johnny claims q re-
fund of $2476.
The same forgiveness could leg
ally be achieved on joint return.
But strong men, on friendly terms
with income tax blanks, turn pale
when they try to imagine the COM
plications that use OF @ joint re-
| turn would involve, They advise