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Show ''fl-y.w.- , Serials Order Dept. University of Utah SLC,Utah 84112 VOLUME 1. NUMBER 35 To An End Utah's affluence of the past few sources would have only $2.7 million years is coming to an end, and the remaining to cover state building State win incounter considerable needs, nd pay for any new or difficulty in balancing its expanded programs, from present tax sources budget Among the possible options open in the ahead. to the 1975 Utah Legislature are period Among the factors contributing (1) reduce costs and cut back on to Utah's rapidly deteriorating programs by restricting state apiinanciai condition are (1) a mis- - propriations, (2) restore the use of e state property tax levy to help calculation in the effect of 1973 the uniform school fund, valance income tax law changes. (2) risingO . .. .!1-' ' raise state individual income uuutuun ana ine fact that state (3) salaries are tied to changes in the tax rates to make up the loss from the 1973 miscalcuindex, (3) rapidly lations, (4) increase the state sales growing retirement costs for state tax levy, and (5) raise other state and school employees, (4) the phase-oof the state property tax this tax rates such as the cigarette tax. year, and (5) other revenue collections that are falling short of expectations. When it became apparent that the State was going to face some serThis column of questions and ious financial problems, the Goveranswers on federal tax matters is nor ordered a 3 cut in general provided by the local office of the fund and uniform school fund apU.S. Internal Revenue Service and propriation allocations for the 1974-7- 5 is published as a public service to fiscal year. It is expected that taxpayers. The column answers these cuts will result in total savquestions most frequently asked by ings of $5,135,000 for the year. taxpayers. It is expected that the general Q. I wixk as an auto mechanic fund will conclude the present busibut I plan to start a part-tim- e (1974-75- ) fiscal year with a surplus ness building hot rods from Model of $23.:4 million, but that the uniA's. Although I expect to make a form school fund will have an endprofit from this business eventually, ing deficit of $10.0 million unless there will be losses in the beginning some additional action is taken by due to the large investments I'll the 1975 Legislature. make in equipment and advertising. The fiscal outlook for 1975-7- 6 Can I deduct these losses even is much less optimistic If expendithough my business won't show ture increases were limited to much income? state changes, 1975-7- 6 A. Yes, you can. An activity is fund school reand general fund, considered a business if it is entered into and carried on in good faith for the purpose of making a profit Two characteristic elements of a business are regularity of activities and transactions and the production of income. In a given year, if no income or a small amount of income Utah Power & Light Co. said is coupled with expenditures that Friday it will spend $192.3 million produce a loss, there may be a for a new construction durin? 1975 Question whether a business was the largest construction budget in carried on in that year. However, the company's history. This year absence of income in itself does not UP&L spent $102 million. prevent you from deducting the E. A. Hunter, president of the ordinary and necessary expenses connected with your business, Salt Lake City-base-d utility, said Q. 1 just finished doing jury planned 1975 construction outlays are for generation, transmission, long case. duty on a distribution and pollution control Will I have to pay tax on the fee I received for serving on the jury? equipment "These expenditures," Hunter said, "are necessary so that we can meet the requirements of our customers, and meet our responsibility as an electric utility for reliable service." Major generation outlays will be EMPLOYMENT The civilian labor force continued spent for the company's 415 megawatt, second unit at the coal-fire- d its upward climb as it soared to a Huntington Plant now under con- new high of 64,964, up 2,665 workstruction and scheduled for com- ers above the November 1973 pletion in 1977; figure. This represents an annual -- for work on a new 415 megagrowth of 4.3 percent Additionally, watt unit at UP&L's new Emery it indicates the growth occurring Plant in central Utah and scheduled in the county since about forty for operation in 1978; percent of the population increase -- for work on the company's proenters the labor force. Total employment in the area posed 415 megawatt fourth unit at the Naughton Plant located in for November 74 was estimated at southwestern Wyoming which is 61,271, up 2,203 above November scheduled for operation in 1979. 1973. Fortunately, the number of Utah Power & Light operates in new jobs created by employers has most of Utah, southeastern Idaho almost kept pace with the increase and the extreme southwestern cor- in labor force, thus avoiding inner of Wyoming. creased unemployment Xl ng ut UP&L Const Budget Largest In Co. - two-mon- th Area Employment Remains Stable W.tj.jJ MONDAY, DECEMBER 9, 1974 RecoircS Consiirafl ction Valuation Housing Starts Still Ming by Carol Forsey Research Analyst The value of construction in Utah for the first nine months of 1974 hit an all-tihigh again, but the percentage increase between 1973 and 1974 was not as great as the percentage increase in the two previous years. Total valuation for the period in 1974 was over $370 million, an increase of 9.4 percent over permit-authoriz- ed nine-mon- th Taxpayers Ask I.R.S. cost-of-livi-ng " w; t CAM SALT LAKE CITY, UTAH Utah's Affluence Coming cost-of-livi- mm mil -' A. Yes, jury duty fees represent earned income and they are taxable. Q. My great uncle died recently and left me some trust income in the form of some dividends. How do I report this on my tax return? A. Each item of income retains the same character in your hands as it had in the hands of the trust So, if items of income distributed to you include, for example, dividends of domestic corporations, interest or capital gains, they will retain the same character in your hands for the purposes of tax treatment You should report your dividends on line 10a of Form 1040, U.S. Individual Income Tax Return. Q. I rent a large safe deposit box for keeping some small pieces of art and important papers. Is the rent on the box tax deductible? A. Safe deposit box rent is deductible if the box is used for the g storage of taxable, investment-related bonds and stocks, papers and documents. The ' rent is not deductible if the box is used for personal effects or securities. tax-exem- pt income-producin- tax-exem- In This Issue Births 2 3 3 3 4 5 5 5 Building Permits 6 Business Licenses Business Telephones Bountiful Power Water Service Third District Court Supreme Court Decisions Bankruptcies South Salt Lake Building Permits Trust Deeds Warranty Deeds Quit Claim Deeds Mortgages Tax Liens Murray Power Murray City Court New Corporations 6 6 6 6 7 7 8 Legals ProbateCourt Confirmation of Sale Probate Suits Small Claims Marriages Divorces Liens Uniform Commercial Code Filings ... 8 8 8 9 9 10 10&16 10&16 10 11 3&11 West Jordan Building Permits . 12 pt the comparable period in 1973. The increase for the third quarter of 1974 was only 3.8 perecent over the same quarter in 1973. The type of construction showing the largest gain through September was additionas and alterations. The value of additions and alterations was over $44 million, an increase of 51.9 percent over 1973. Residential Construction New dwelling units authorized in Utah continued to decline through the first quarter of 1974 and were 15.9 percent fewer than for the comparable period in 1973. The decrease during the third quarter was even greater - 29.3 percent less than 1973. d The value of residential construction for the period dropped for the first time since 1966. The decrease was only 1.1 percent from 1973, however, and was still well above the permit-authorize- . nine-mon- th average. The third quarter valuation in 1974 was 92 percent below the same quarter in 1973. Nonresidential Construction The value of nonresidential construction through September of this year hit a record High of over $127 million, 17.4 percent higher than 1973. Like total construction, however, this percent increase was as great as the 42.8 percent increase for the same period between 1972 and 1973. During the third quarter of 1974, nonresidential construction showed a gain of 2.9 percent over 1973 end was 71.1 percent higher than the average of the test decade. The value of over $49 million for 1974 was not a record for the quarter. It fell below the third quarter of 1971, the quarter when the ZCMI shopping center permit was issued - still the largest permit on record - $30 million. ten-ye- ar permit-authorize- d Forecasters Predict Hard Times Ahead for 1975 County budgets are now being prepared throughout Utah. Commissioners in 29 counties are considering record requests that will determine next year's levels of ' sparing. If spending goes up, so will taxes. What is the outlook for the year ahead. Grim, if past trends foretell the future. Counties take a huge bite of the total state property tax take - 20.3 this year to be exact. Of an estimated $179,559,000 total property taxes charged this year, about $36,485,000 will go for county purposes. In addition to property taxes, sizeable amounts are poured into county coffers from State liquor profits, B & C Road Funds, and local tax. On top of this, they receive large sums from miscellaneous fees and fines, and from Federal Revenue-Sharin-g and other Federal grants. County levies are inching up every year. They will average 15.86 mills this year as compared with 12.50 mills levied in 1964. This increase amounts to 27. Valuations in the same have jumped 56 period. Individual levies vary considerably even between counties with similar population and assessment characteristics. More important than total levies in measuring county tax burdens would be property taxes charged per capita. Here the state average is $31.53, up from $29.89 last year. Tax outlook for 75 is not bright if commissioners bend to the pressures of county bureaucrats, organized labor, and big spenders. Property tax rates and per capita burdens are bound to balloon if re- straints is not exercised now in budget preparation. To aid county i officials to "hold the line in 75", we recommend: 1. A moratorium on hiring of new employees. 2. A moritorium on initiating expensive new programs or projects. 3. A moritorium on initiating new Federal programs. Salaries. Some county workers have had no increase for two years. Others have gotten only small adjustments. It is unfair for these county employees to be the scapegoats of inflation control. Nor is it fair that taxpayers should shoulder higher salary costs through steeper rates. We would suggest that wages and salaries be increased only if other budget items are cut accordingly. Hard times ahead. This is the prediction of most economic forecasters for 1975. Continued double digit inflation. Higher unemployment More labor unrest Still higher prices. All hitting hard at the pocketbook of the taxpayer. This is not a time for higher taxes. Governor Rampton says, "No state tax increases next year". We agree. What is good for the state should be good for the counties. Supreme Court Decisions See Details Page 7 |