Show many deductions allowed by treasury on income tax every worker can claim credits under the new levy by ALFRED released by western newspaper union although wartime necessity demands that uncle sam collect the highest income taxes in history there is nothing unpatriotic in taking advantage of legitimate ways to lower your payments as provided by law tax laws are carefully written instruments in writing them congress included a list of deductions which taxpayers may claim these deductions were included for excellent reasons and with the expectation that all taxpayers who could honestly claim them would do so the big taxpayer usually finds it advantageous to hire an expert who is familiar with each permissible deduction the smaller taxpayer is not so likely to secure outside assistance the latter would do well to determine for himself the deductions he can make legitimately i for the person who makes not more than 2000 of taxable income which means a single man earning not more than 2500 or a married man or head of a family earning not more than every of deductions claimed will mean an 1840 reduction in income taxes paid where larger incomes are involved savings are proportionately greater the following are important deductions duct ions which will aid the average taxpayer you can deduct license pee fees business Bu sinet expenses expense contributions interest taxes all contributions for public purposes made to the united states any state city or town are deductible as are contributions to a domestic nonprofit organization operated exclusively for religious charitable literary educational or scientific purposes or for prevention of cruelty to children and animals church contributions include pew rent assessments etc organizations such as USO army and navy relief red cross community chests etc come under the charitable heading literary and educational organizations include such institutions as nonprofit colleges and schools the boy scouts voters leagues and study groups the scientific heading includes all nonpartisan scientific societies it is not permissible to deduct contributions made to a bar association a medical association a prohibition hibi tion association political campaign committees volunteer fire companies social fraternities athletic clubs or gifts to needy friends or relatives generally speaking the taxpayer may deduct any interest paid on borrowings including business personal and family debts because interest paid on behalf of a relative or friend is not a legal obligation on the taxpayer such interest is not deductible As a broad general rule the individual can deduct all taxes he personally pays to the tax collector except federal income estate and gift taxes and state and local benefit inheritance I 1 estate legacy or gift taxes federal taxes which are deductible include those on admissions dues telephone telegraph transportation auto use safety deposit boxes etc admission adm is P sion taxes collected at theaters and other places of amusement during 1942 amounted to 10 per cent A 50 cent theater ticket which cost the customer 55 cents represents a 5 cent deduction automobile owners are entitled to deduct state and local license fees the federal use stamps which cost in 1942 drivers license fee and state gasoline tax automobile owners may not deduct the federal gasoline tax because it is constituted as a tax on the manufacturer and not on the consumer even though it was passed along to him it is the general rule that the taxpayer gets credit only for those taxes levied directly upon him for that reason state and federal taxes on cigarettes and liquor are not deductible they are stamp taxes levied on the e manufacturer or dealer the transportation taxes paid on railroad airline and other personal transportation last year is deductible the rate was 5 per cent of the fare for the first 10 months 10 per cent for the last two months the tax on transportation of goods amounting to 3 per cent on all freight and express bills is deductible taxes imposed by the federal government on jewelry furs and toilet goods are not deductible they are excise taxes levied on the m maker aker or dealer and are not collection taxes levied on the taxpayer also deductible are traveling expenses required by ones employer when such expenses are not reimbursed by anything over salary wages or commissions when your car is used partly for business and partly for private purposes deduction is allowed only for the portion used for business and then only when the driver is s not reimbursed the loss on the sale of a car used partly for business and partly for private purposes is divided similarly but only when actually sold and not when used as a trade in in addition to deducting the three cent state tax on all gasoline used in your car you can also deduct the cost of the gasoline and other supplies for business use of the machine dues to labor unions assessments by unions for out of work benefits but not for sick accident or death benefits cost of indemnity of fidelity bonds required by your employment and cost of tools and patterns necessitated by the type of work are deductible but only if their life is less than one year it if their life is longer than one year the owner can discount depreciation only no deduction is permitted for medical and dental expenses including accident and health insurance pre unless they exceed 5 per cent of your income any expense over 5 per cent of income and up to a maximum of 1250 for d a single person or 2500 for a family may be deducted this includes hospital bills treatment diagnosis and everything ery thing connected with medical and dental care farmer deductions wages seed repairs tools toola fertilizers Fertilize rc depreciation in general a farmer who operates a farm for profit is entitled to deduct from gross income as necessary expenses all amounts actually expended in carrying on the business of farming the wages paid for hired labor are deductible the value of products furnished by the farm and used in the board of hired labor is not a deductible expense but food purchased and furnished to hired hands is deductible farmers may deduct the cost ol of grain and hay amounts paid for grinding and processing feed amount paid for hire of machinery cost of farm supplies gasoline for farming repairs and upkeep of cars amounts expended for repairs and maintenance of farm buildings except the dwelling fences drains and other farm improvements and for repairs and maintenance of farm machinery and equipment are deductible amounts expended for replacement of or additions to farm machinery farm buildings or other farm equipment of a permanent nature are not deductible as such expenditures tures are regarded as investment of capital which is returned to the owner through depreciation allowances during the useful life of the property the cost of small tools of short life may be deducted the cost of commercial fertilizers and lime the benefit of which is of short duration is deductible as an expense the amount expended in the restoration of soil fertility preparatory to actual production of crops and the cost of liming soil to increase productiveness over a period of years are capital capita expenditures and thus are not deductible fees paid for advertising farm products expenditures for stamps stationery account books and other office supplies purchased for farm use expenditures for travel in connection with the farm business and other similar miscellaneous expenditures are deductible an allowance for depreciation oi of buildings improvements machinery or other farm equipment of a permanent nature is deductible the amount claimed on account of depreciation should not exceed the original cost of the property repairs on depreciation on the dwelling occupied by the farmer or on his personal or household equipment are not deductible it is not permissible to claim as a separate item depreciation on livestock or ann an other property included in the farm ers inventory as such depreciation is taken care of in the reduced amount of the inventory at the clos of the year however depreciation may be claimed on livestock ac quiren for work breeding or dair dairy purposes which are not included in the inventory of livestock purchased or raised for sale |