The journal. (Caldwell, Ohio) 1934-1961, 1959-02-19
INCOME TAX HINTS

.A uV -
associations and federal savings
ard loan associations are not ex-
cluded. Dividends from these or
gdnizations on deposits and
W thdraWable accounts are in
terest and must be reported on
page 3, schedule B of the tax re-
turn.
Dividends from regulated in
vestment companies do not
count except to the extent that
the company designates that the
payments received by you are
dividends.
Dividends from foreign cor
porations and from foreign trad
irg corporations do not count.
Where a joint return is filed
and both, spouses have dividend
income, then each may exclude
up to the first $50 of dividend
income received.
Dividends IN excess OF sou are
subject to a credit of 4To which
is computed on page 4, Schedule
j, and then is deducted directly
from the tax on line 13(a) page
one of the tax return.
The credit is actually 4@o of
the dividend income, less the
exclusion of the first $50 or 500,
as the case may be, or your total
income tax or, 4%o of your tax
able income, whichever is the
smaller.
Taxpayers who pay for the
care of their children and other
dependents may be able to de-
duct a part or all of the cost on
their Federal income tax return
Form 1040 for 1858, Nathaniel
Locker, director of Internal Re-
venue for the Columbus district,
said today.
He explained:
"A deduction is allowed for
expenses paid for the care of
one or more dependents if such
care is to enable the taxpayer to
| be gainfully employed or to
actively seek gainful employ
ment.
This deduction may be claim
ed by any woman or by any man
who is a Widower, divorced, OF
legally separated under court
| decree.
'The dependent Cor depend.
ents) cared for must be a child
under II years of age or a per
son who is physically or mentally
incapable of caring for himself
regardless of age.
"There are certain other re.
quirementS to be met in order
to claim this deduction. These
are:
81. Deductions must be itemiz
ed on page 2 of Form l040.
-. The deduction may not eX.
ceed 5000, and must be reduced
in some cases.
"3. Married women must file
joint return with their hus
bands and reduce the deduction
by the amount their combined
gross income exceeds $4,500
For example, if $700 wa
spent, and the combined income
OF husband and wife was $4,700
the deduction would be $40l
($600 minus 5000. If only $50J
was spent and the combined in
come was $4,700, the deduction
would be only $500 ($500 minu
$1,000. This rule does not apply
l however, if the husband is in
capable of self-support due t.
!. mental or physical cause.
"4. You may not deduct pay
e ments made to anyone you ar
n entitled to claim as a dependen
i On your return.
S IS. If the person receiving TIL
payments performs duties othe
r than caring for your dependent
4 The total amount paid must b
I apportioned and only the par
S paid for care may be deducted.
: Mr.. LOCKER added that tax
G payers claiming this deductio
o should attach a statement t
y their return, showing the amour
I paid and the person to whom
6 was paid. Those who wish ma
obtain a copy of Form 2441 fror
e his office for this purpose.
r Taxpayers who have any que.
n tons on this subject may &c
o Document No. 5052, Child Car
is and Disabled Dependent Care,
by calling CA l-64ll, Ext. 432 c
IL 431, or by writing to 10 Wes
a Long Street, Columbus Is, Ohi'
Mr. -Ata.