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Show j INCOME TAX FACTS 1 4- Your Income tax soon, will be due. DonT fret about "it read these articles by K. A. Conkoy, tax consultant for tho Central National Nation-al Bank Savings and Trust company, com-pany, Cleveland. They teJl you everything you want to know in I mguago you can understand. Mnis is Con key's third article. By EL A. CONKI.y Question 19 Wih at amount of Lib-eity Lib-eity bonds can be held free from sur- tax? Answer ill Five thousand dollars i of principal of bonds of the second, third and fourth Liberty Joans and all certificates of indebtedness and wai innvliigs certificates. (2) Thirty thousand dollars of I first 3 1-2 per cent bonds converted it nine of Issue of the fourth Liberty I loan. j (3; One hundred and twenty-five ; thousand dollars of 4 per cent and j 1 1 4 per cent Liberty bonds The first 3 1-2 per cent and Victory 3 3-4 per cent bonds are. exempt from all normal and sur-tax. There is no I exemption from sur-tax in c.ase of the , Victory 5 3-4 per cent bonds. I Q, 30 Are- dividends lrom domestic domes-tic corporations subject to both nor-i nor-i mal und sur-tax? j A. No. they aro only subject to sur-tax, as the corporation paying the Idlvidenel pays a normal tax on its earnings which are later distrlbuteel u-s i dividends. I y. jj When can one claim exemption exemp-tion as head of a family? A. If you actually support and maintain in one household one or more persons who are closely connected to you by blood relation, marriage or : adoption. j2 What dale governs ihe personal per-sonal exemption? A,- Yout marital status on the last da-, of the year, or tho taxable pc-i pc-i rlod. governs the exemption Cj. zZ Arc gains from gambling taxable ' A. Yes, all gambling gains and illegal il-legal profits in violation ,.,( criminal ! luw or public regulations are tax-!able. tax-!able. Losses from such sources are not allowable deductions. Q. ;M Does a taxpayer have to rc-I rc-I port to the government amounts of income paid to lndlvidauls? A. Yea, if yeu pay to any person during the vear salary, rent, interest, commission or other Income amounting amount-ing to $1000 or more you are reouireel lo file a return of information showing the amount and the name and address ,,t tin Jul -on to horn p. ild i'roper forms tor this return can bo secured from the collector for your district. q What rate of depreciation can bo claimed on buildings? A. The rate of depreciation now generally recognized by the govern-' govern-' ment Is 2 per cent on urlck buildings and 3 per cent on framu buildings. This Is an annual allowance bated on tho cost of the building only. This deduction can only bo claimed on business or rented property and is not allowed on a residence in which tho taxpayer lives. It is allowable however, on a resielence which he rents to another person. q. 20 John Smith conducts a harel-irare harel-irare store. On December 31, 1920, his Inventory was $15,OU0. During the year ho purchased ?3G,000 worth of goods and his sales for the year were $75,000. On December 31, 1921, his inventory vvai $17,000. How do these items enter into Smith's income tax return? A. Tho inventory at the beginning of the year. $16,000. is added to the purchase, $35,o0u. making $50,000. from which the inventor1- at the end of the year. $17,000. is deducte-d, leaving leav-ing $33,000, which representee tho I pst of goods sold " This, deducted from tho sales. $75,000. leaves $42,000, which is tho "rtoss profit" from the business. In addition, he can deduct his general expenses, losses, depreciation, deprecia-tion, etc., to determine his net income. q. 27 An individual owns an apartment apart-ment house anil lives In one of the apartments with his family. Tho entire en-tire building Is healed by one furnace and owner furnishes heat, light, wa-lor wa-lor and Janitor for tho entire block. How should tho apartment figure in the owner's return? A. The owner must determine how-much how-much of tho cost of heating, lighting, etc., is attributable to his own apartment, apart-ment, and tho balance of such costs may be deducted from rross income as an expense. Lepreciatlon should be apportioned in the same manner. The rental value of hLs own apartment I sad nor bo included In the gross Income In-come but tho entire amount of rent received from the other apartments must be returned. Q. 28 An attorney supporting a family owns an automobile used both ; for business and pleasure. He em-i. em-i. ... j sin assistant and a stenographer Jin his office. He pays club elues and 'subscribes to legal publications and books anel donates to charitable organizations. or-ganizations. How should these items be treatod is his return? A. The part of the automobile ex- pense apportioned to tho time it is i ' used for business Is an allowable ex- ! pense The salaries of the assistant! and stenographer are a business expense. ex-pense. Club dues are not allowable lieductlons unless a strictly business club such as a. chamber of commerce. I Iegal publication and business I books as well as donations are allow - I able deduction". (.More spwJmen casr" will bo rle-scribod rle-scribod in Cpnkey's fourth article In tomorrow's Standard-Exsmlncr. j |