Jasper County Democrat, Volume 21, Number 96, Rensselaer, Jasper County, 1 March 1919 — THIS TELLS HOW TO FIGURE INCOME TAX [ARTICLE]

THIS TELLS HOW TO FIGURE INCOME TAX

Squarely Up to Every Individual to Get Busy by March 15 or Suffer Penalty. , .. * ” “Don't wait until the final doe date, March 15, for paying your Income Tax and making your return. Avoid the last minute rush. Any person can figure out his liability today as well as he can nexf week, and If there Is any point on which he needs advice he can now get in touch with a Revenue man." This word of advice is being given out by Internal Revenue men. Returns and payments are being collected In Indiana by the following Collectors of Internal Revenue: Peter J. Kruyer. 3 Isaac It. Strouse. Every aid of their offices and field forces is being given freely to the public. But the Income Tax men will not pull your door bell or your coat-tails, according to the Collector's announcement. It is squarely up to every individual to figure out his own case and to get busy if he comes within the scopo of the new Revenue law. Did You Earn This Much? Every unmarried person who received income averaging $19.25 a week during 1918 and every married couple who jointly received income averaging $38.50 a week should secure at once from the nearest Deputy Collector or the nearest bank a blank Form 1040 A. That form contains the information he will need to enable him to figure his correct net Income and any tax that he owes the government. The law requires that every unmarried person who had a net income of SI,OOO or over and every married person whose net income was $2,000 or over (including the income of husband or wife and the earnings of minor children, if any) must make a return On or before March 15th. And this requirement does not hinge on whether the person owes a tax.

Taxable Income. An Individual must Include under gross income all gains, profits and income derived from salaries, wages or compensation for personal service of whatever kind and in whatever form paid oj from professions, vocations, business, sales or dealings in property of all kinds, Interest, rent, dividends or profits derived from any source whatever. Very few Items of income are exempt. Deductions include ordinary and necessary business expenses, interest paid or accrued on indebtedness, taxes of all kinds except Federal income and excess profits taxes and assessments for local benefits, losses actually sustained! debts ascertained to be worthless and depreciation on buildings, machinery, fixtures, etc., used in business. A further deduction is allowed for contributions to corporations operated for religious, charitable, scientific or educational purposes or for the prevention of cruelty to children or animals to an amount not exceeding 15 per cent of the taxpayer’s net income as computed without the benefit of the contribution deduction. The taxpayer is not allowed to deduct any personal, living or family expense, any amount spent top Improving property or any expense of restoring property or making goo<L its exhaustion for which an allowance Is claimed under depreciation. Figuring the Tax. Before figuring the normal tax the dividends are deducted as credits from net Income, together with the personal exemption. As in previous years, dividends of domestic corporations are exempt from normal tax when received by the stockholder. . ■> The normal tax rates for citizens and 'residents are as follows; On the first,js4j)oo of net Income In excess of the credits the rate is 6 per cent; on any further taxable Income the rate is 12 per cent. The surtax rates apply to net income of each individual in excess of $5,000. The personal exemption and the dividends are not deductible before computing surtax. In the case of returns by husband and wife, the net income of each is considered separately In computing any surtax that may be due. Form 1040 should be used for making returns of net income exceeding $5,000, and the instructions on that form will show how to figure the surtax. Business House Returns. Employers and others who paid wages, salaries, rents, interest or similar determinable gains in an amount of SI,OOO or over during 1918 to any person must file an Information return with the Government. Blanks may be secured from the Collector. Every partnership must file a return showing its income and deductions and the name and address of each partner, with his share of the profits or losses during the past year. Personal service corporations will file similar Information for 1918.