The midland journal. (Rising Sun, Md.) 1885-1947, 1946-01-11
TAX CUTS IN 1a4e

will get their first taste of new lower
income taxes.
Tax cuts under the new law apply
January /. That means smaller
amounts will be withheld from pay
received on and after that date, even
If the pay is for work done before
| the new year.
About 100000 low-income per-
sons who have paid taxes on 1916 in
come will pay no tax ON 1916 income.
The remaining 35,000,000 will
carry lighter tax load For many
who support families of two or more
dependents the tax saving will mean
additional money for food, clothing
and other necessities.
The amount of income tax with
held from wages depends upon the
number of exemptions the taxpayer
can claim as well as the wages he
earns. A taxpayer gets an exemption
of $500 each for himself, his wife
and his dependents. These exemp-
tions are included in the Government
tax table used by an employer in find
| ing the amount to be taken from a
workers pay.
Exemptions are listed on certifi-
Gates filed by employees with otter
employers. New exemption certif-
| Gates are not required unless there
has been change in the number of
an employees exemptions.
An nrfon nj 10 ~
is that the reduced taxes have moth
| ing to do with your 1916 income.
They apply to income received in
1916.
For 1915 income, every civilian
| who received $500 or more in 1916
must file return on it before mid
| night of March Is, 1916. That in
cludes persons who do not owe any
/ tax for 1916 and also those who pay
| up their tax in full during 1915.
Some taxpayers will get refunds ON
| their 1915 tax. Others will still owe
some tax.
The Government requires employ
ers to furnish employees on or before
January 81 with Withholding receipts
| (Form WIZ for 1915. These re-
ceipts list your gross pay and the
amount of tax withheld from that
pay Most wage earners are allowed
to use their Withholding receipts as
1915 income-tax returns.
The receipt is an "extra-simplified"
return, so it will pay most taxpayers
not to lose or mislay it. Otherwise
| they will have to get another from
| their employer or make out more
complicated return ON Form 1040.
If your wages in 1916 amount to
$4,000 or more, or if your income
other than wages, totals more than
500, you can't use the Withholding
receipt as return.
Long And Short Forms
You must use the long Form 1040
if your income was $1,000 or more,
or if you claim deductions (taxes, in
terest, large medical expenses, etc.
amounting to more than ten pc recent
of your income.
You may use the short Form 104O
if your income was less than $4,000
regardless of source. If the return is
made on the short Form 1040 or on
a Withholding receipt, the tax is fig
ured from table which automatical-
ly allows about ten per cent of the
total income for deductions. Taxpay-
ers with allowable deducti n
amounting to more than ten per cent
save money using the long Form
1910.
Provisions For Service Men
Men and women veterans of the
United States military and naval
forces below the grade of commits
stoned officer have no tax liability for
service pay The new law says they
do not even have to file returns with
respect to service pay.
Commissioned officers get a special
tax exemption of 500 of service
pay This is in addition to the regu-
lar $500 exemption each, allowed ev-
cry person (civilian or military for
himself, wife and dependents.