Kankakee Valley Post, Volume 13, Number 11, DeMotte, Jasper County, 22 January 1943 — FEDERAL INCOME TAX PERSONAL EXEMPTION [ARTICLE]

FEDERAL INCOME TAX PERSONAL EXEMPTION

Every individual is allowed a credit against his net income which varies with his domestic status, that is, whether he is (a) a single person, (b) a married person living with husband or wife, or (c) a head of family. This credit is konwn as personal exemption, and is shown on line 21 of the return Form 1040. The amount of the personal exemption also varies depending upon the period during which the taxpayer occupied the particular exemption status. The personal exemption for a single person is SSOO for the year; for a married person living with husband or wife, $1200; and for a “head of family, SI2OO. (Personal exemption as head of a family has no effect on liability to file a return.) For Federal income tax purposes, widows, widowers, divorcees, and married persons separated by mutual consent, as well as persons who have never been married, are classified as single persons. A head of family is defined as “an individual who actually supports and maintains in one household one or more individuals who are closely connected with him by blood relationship, relationship by marriage or by adoption, ad whose right to exercise family control and provide for those dependent individuals is based upon some moral or legal obligation.” A single person, or a married person not living with husband or wife, may, therefore, enjoy a head of family exemption under certain conditions. Taxpayers using a simplified return (which is permitted of the gross income for the year is S3OOO or less and devived solely from earning from employment and or from dividends, interest and annuities) obtain personal exemption based on their status as of July 1 of the year. Thus, a taxpayer married and living with husband or wife on July 1 is entitled to SI2OO personal exemption on Form 1040 A; if he were a widower on July 1, his exemption would be SSOO, irrespective of the date on which he became a widower. The amount of the exemption is not deductible from the income but is reflected in the amount of tax shown in the table on the reverse side of the form. Taxpayers using Form 1040 obtain personal exemption proportionate with the number of months during which the particular status is held. Thus, for a person who married on July 1, (who was not a head of family prior to his marriage) the personal exemption would be SBSO ($250 for the 6 months as a single man, plus S6OO for the six months as a married man), jin this example it is assumed that the wife has no income. Married persons may, however, file joint returns, even though one has no income, and by filing a joint return a couple married during the year may obtain an exemption amounting to the exemption to which they would be entitled for the period of married status plus the amount of their indi vidual exemptions prior to their marriage. In the example given the total exemption in

a joint return would be $llOO ($250 for each spouse for six months plus S6OO for 6 months married status). If a husband and wife living together both have income and file separate returns on Form 1040, the personal exemption applicable to a married person may be taken in the return of either or divided between them in any way as they may agree, but the total personal exemption taken in the two separate returns may not exceed SI2OO.