personal pro by gift or in Certain salaries upon been collected not to be included. in the purchase or production of said stock or produce, and not including any part thereof consumed directly by the family; money and the value of all money and personal property acquired by gift or inheri- perty acquired tance; all other gains, profits, and income heritance. derived from any source whatever, except that portion of the salary, compensation, or pay received for services in the civil, military, naval, or which tax has other service of the United States, including Senators, Representatives, and Delegates in Congress, from which the tax has been deducted, and except that portion of any salary upon which the employer is required by law to withhold, and does withhold, the tax and pays the same to the officer authorized to receive it. In computing incomes, the necessary expenses actually incurred in carrying Deductions: on any business, occupation, or profession business; shall be deducted, and also all interest due or paid within the year by such person on existing interest due indebtedness. And all national, State, county, school, and municipal taxes, not including those assessed against local benefits, paid within the year, shall be deducted from the gains, profits, or income of the person who has actually paid the same, whether such person be owner, tenant, or mortgagor; also losses actually sustained during the year, incurred in trade or arising from fires, storms, expenses of or paid; taxes; losses; Estimated de or shipwreck, and not compensated for by insurance or otherwise, and debts ascertained to be worth- worthless less, but excluding all estimated depreciation debts. of values and losses within the year on sales of real estate purchased within two years previous to the year for which income is estimated: Provided, That no deduction shall be made for cluded. preciation exLosses on sales of real estate. Proviso as to ments. Only one exemption of $4,000 to each family. dians and wards. Salaries of persons in United in certain cases any amount paid out for new buildings, permanent improvements, or betterments, made to increase improvements the value of any property or estate: Provided further, That only one deduction of four thousand dollars shall be made from the aggregate income of all the members of any family composed of one or both parents and one or more minor children, or husband and wife; that guardians shall be allowed to make a deduction in favor Case of guar- of each and every ward, except that in case where two or more wards are comprised in one family, and have joint property interests, the aggregate deduction in their favor shall not exceed four thousand dollars: And provided further, That in cases where the salary or other compensation paid States service to any person in the employment or service of to be included. the United States shall not exceed the rate of four thousand dollars per annum, or shall be by fees, or uncertain or irregular in the amount or in the time during which the same shall have accrued or been earned, such salary or other compensation shall be included in estimating the annual gains, profits, or income of the person to whom the same shall have been paid, and shall include that portion of any income or salary upon which a tax has not been paid by the employer, where the employer is required by law to pay on the excess over four thousand dollars: Provided also, That in computing the income of any person, corporation, company, or association there shall not be included the amount received from any corporation, company, or aswhich tax has Sociation as dividends upon the stock of such corporation, company, or association if the tax of two per centum has been paid upon its net profits by Salary on which tax is not paid by employer to be included in certain cases. Dividends received on been paid to be excluded. said corporation, company, or association as required by this act. Compare this section with Sec. 117, act June 30, 1864, as amended, infra. See, also, amendment in Appendix. Act Aug. 28, 1894. Persons of lawful age with an income of more than 83,500 for the year to make return to the collector. trustees, etc., turns for SEC. 29. That it shall be the duty of all persons of lawful age having an income of more than three thousand five hundred dollars for the taxable year, computed on the basis herein prescribed, to make and render a list or return, on or before the day provided by law, in such form and manner as may be directed by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, to the collector or a deputy collector of the district in which they reside, of the amount of their income, gains, and profits, as aforesaid; and all guardians and trustees, executors, administrators, agents, receivers, Guardians, and all persons or corporations acting in any to make refiduciary capacity, shall make and render a minors, etc. list or return, as aforesaid, to the collector or a deputy collector of the district in which such person or corporation acting in a fiduciary capacity resides or does business, of the amount of income, gains, and profits of any minor or person for whom they act, but persons having less than three thousand five hundred dollars income are not required to make such report; and the collector or deputy collector shall require Returns to every list or return to be verified by the oath or by oath. affirmation of the party rendering it, and may the amount of any list or return if he has reason to believe that the same is under- increase the stated; and in case any a taxable income shall neglect or refuse to make and render such list and return, or shall render such person having be verified increase Collector may amount of return in case of understatement. Neglect or re fusal to make a willfully false or fraudulent list or return, it shall be the duty of the collector or deputy collector to make such list, according to the best information he can obtain, by the examination of such person, or any other evidence, and to add fifty per centum as a penalty to the amount of the tax due on such list in all cases of will return, or making will fully false re turn; duty of lect or refusal. ful neglect or refusal to make and render a list or return; and in all cases of a willfully false or fraudulent list or return having been ren One hundred per cent pen willfully false return. to be assessed Declaration alty in case of dered, to add one hundred per centum as a penalty to the amount of tax ascertained to be due, the tax and the additions thereto as a penalty How penalties to be assessed and collected in the manner and collected. provided for in other cases of willful neglect or refusal to render a list or return, or of rendering a false or fraudulent return: Provided, That any person, or corporation in his, her, or its own behalf, or as such fiduciary, shall be permitted to declare, under oath or affirmation, the form and manner of which shall be prescribed by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, that he, she, or his or her, or its ward or beneficiary, was not possessed of an income of four thousand dollars, liable to be assessed according to the provisions of this act; or may declare that he, she, or it, or his, her, or its ward or beneficiary, has been assessed and has paid an income tax elsewhere in the same year, under authority of the United States, upon all his, her, or its income, gains, or profits, and upon all the income, gains, or profits for which he, she, or it is liable as such fiduciary, as prescribed by law; and if the collector or deputy collector shall be satisfied of the truth of the increase of re turn by collecparties may tor or deputy, be permitted to prove the amount of income. Appeal from decision of collector. declaration, such person or corporation shall thereupon be exempt from income tax in the said district for that year; or if the list or return of any person In case of the or corporation, company or association, shall have been increased by the collector or deputy collector, such person or corporation, company or association, may be permitted to prove the amount of income liable to be assessed; but such proof shall not be considered as conclusive of the facts, and no deductions claimed in such cases shall be made or allowed until approved by the collector or deputy collector. Any person or company, corporation or association, feeling aggrieved by the decision of the deputy collector, in such cases may deputy to appeal to the collector of the district, and his decision thereon, unless reversed by the Commissioner of Internal Revenue, shall be final. If dissatisfied with the decision of the collector, such person or corporation, company or association, may submit the case, with all the papers, to the Commissioner of Internal Revenue for his decision, and may furnish the testimony of witnesses to prove any relevant facts, having served notice to that effect upon the Commissioner of Internal Revenue, as herein prescribed. Such notice shall state the time and place at which, and missioner. the officer before whom, the testimony will be taken; the name, age, residence, and business of the proposed witness, with the questions to be propounded to the witness, or a brief statement of the substance of the testimony he is expected to give: Provided, That the government may at the same time and place take testimony upon like notice to rebut the testimony of the witnesses examined by the person taxed. Appeal from decision of colmissioner of lector to Com Internal Revenue. Notice of appeal to com Witnesses. |