Form 1040a - Individual Income Tax Return - 1918 (Page 5 of 6) in pdf

Page 1 of Instructions

INSTRUCTIONS FOR FILLING INDIVIDUAL INCOME TAX RETURN FOR NET INCOMES OF NOT MORE THAN $5,000

VI. PERSONAL AND FAMILY EXEMPTION.

I. HOW TO DECIDE WHETHER TO MAKE A RETURN.

1. If you were married and lived with your wife (or husband) or were head of a

1. Calculate your net income by filling in page 2 of the worksheet according to

family in 1918, you may subtract from your net income, before calculating your tax,

page 2 of the instructions.

a family exemption of $2,000 plus $200 for each person under 18 (or mentally or

2. Add the net income of your wife (or husband) and dependent minor children, if

physically defective) who received his chief support from you. If husband and wife

any, except as provided in paragraph 4.

make separate returns, this exemption may be claimed by either (but not by both) or

3. The total family income, calculated in accordance with paragraphs 1 and 2, must

may be divided between them.

be reported, either in your return or in a separate return by wife (or husband), if it

2. If you were not married or did not live with wife (or husband) and were not head

equals or exceeds—

of a family in 1918, you are entitled to a personal exemption of $1,000 plus $200 for

(a) $2,000 if you are married and live with your wife (or husband).

each dependent person under 18 (or mentally or physically defective) who received his

(b) $1,000 if you are not married or do not live with your wife (or husband).

chief support from you.

4. Income of a minor or incompetent, if derived from a separate estate under control

3. If you were entitled to any of the foregoing exemptions during a part of the year

of a guardian, trustee, or other fiduciary, must be reported by his guardian or other

only, you may claim as many twelfths of the exemptions stated as there were months

legal representative.

in such part of the year. Any part of a month may be counted as a month.

4. The personal or family exemption must be reported on line N, page 1, of the

II. ACCRUED OR RECEIVED INCOME.

return, and must be supported by answers to questions 5, 6, 7, and 8.

5. A “head of family” is a person who is the chief support of one or more persons

1. If you keep books showing income accrued and expenses incurred during the

living in his household, who are closely related to him (or her) by blood, marriage, or

year, make your return from your books, but do not fail to include all your income

adoption.

even if it is not entered in your books.

2. If you do not keep books showing income accrued and expenses incurred, report

income received and expenses paid.

VII. WHEN TO USE FORM 1040 INSTEAD OF THIS FORM.

3. If you report income accrued, you must include all income that accrued in 1917

You must make your return on Form 1040—

but was not received until 1918, unless it was reported in last year’s return.

(a) If your net income is over $5,000.

4. If you report income received, you must include all income constructively

(b) If the net income reported in this return exceeds $4,000 and the entire family

received, as bank interest credited to your account.

exemption has been claimed in a separate return made by wife (or husband).

III. RECEIPTS EXEMPT FROM TAX.

example, if you receive income from a partnership or personal service corporation

with a fiscal year falling partly in 1917 and partly in 1918).

The following classes of receipts are exempt from income tax, and need not be

reported on page 2 of the return.

1. Pay, not exceeding $3,500, for active services in the military and naval forces

VIII. AFFIDAVIT.

of the United States.

1. The affidavit must be executed by the person whose income is reported unless

2. Gifts (not made as a consideration for services rendered) and money and property

he is a minor or incompetent or unless he is ill, absent from the country, or otherwise

acquired under a will or by inheritance (but the income derived from money or property

incapacitated, in which case the legal representative or agent may execute the affidavit.

received by gift, will, or inheritance is taxable and must be reported).

2. The oath will be administered without charge by any collector or deputy collector

3. Interest on bonds and other obligations of the United States issued before

of internal revenue, or (if you are in the military or naval service of the United States)

September 1, 1917, and on such bonds and other obligations issued since that date,

by any military or naval officer who is authorized to administer oaths for purposes of

provided your holdings do not exceed the exemptions allowed by law.

military or naval justice and administration. If an internal revenue officer is not available,

4. Interest on bonds and other obligations of United States possessions (Philippines,

the return should be sworn to before a notary public, justice of the peace, or other

Porto Rico, etc.).

person authorized to administer oaths.

5. Interest on bonds and other obligations of States, territories, political subdivisions

thereof (such as cities, counties, and townships) and the District of Columbia.

IX. WHEN AND WHERE THE RETURN SHOULD BE SENT.

6. Interest on Federal Farm Loan bonds.

7. Proceeds of life insurance policies paid on the death of the insured.

Send your return to the collector of internal revenue for the district in which you

live or have your place of business so that it will reach him on or before March 15,

8. Amounts received by the insured under life insurance, endowment, and annuity

1919. If the address of the collector is not printed on the return and you do not know

contracts, provided such payments do not exceed the premiums paid in. The amount

it, ask at the post office or bank.

by which the total payments that have been received exceed the total premiums paid

in is income and must be reported in Schedule G.

9. Amounts received from accident and health insurance and under workman’s

X. WHEN AND TO WHOM THE TAX MUST BE PAID.

compensation acts plus the amount of any damages received by suit or agreement on

1. The tax should be paid, if possible, by sending or bringing with the return a

account of injuries or sickness.

check or money order drawn to the order of “Collector of Internal Revenue at [insert

name of city and State].”

IV. FARMER’S INCOME SCHEDULE.

2. Do not send cash through the mail, or pay it in person except at the office of

If you are a farmer, get from the collector and fill out a “Schedule of Farm Income

the collector or a regularly established internal revenue stamp office.

and Expenses.” Transfer the net farm income to line 21 of Schedule A of the return.

3. At least one-fourth of the tax is due at the same time that this return is due.

Report income from salaries, rents, interest, sales of property, etc., in Schedules B to

4. An additional amount sufficient to bring the total payments up to one-half of the

G of the return. Send your Schedule of Farm Income and Expenses with the return to

tax is due on or before June 15, 1919.

the collector.

5. An additional amount sufficient to bring the total payments up to three-fourths

of the tax is due on or before September 15, 1919.

6. The entire remainder of the tax is due on or before December 15, 1919.

V. PERIOD TO BE COVERED BY RETURN.

7. If any payment is not made when due, a penalty of 5 per cent of the amount due

1. You must report your net income for the calendar year 1918, except under the

but unpaid will be incurred. The entire unpaid balance of the tax will also become due

conditions stated in paragraph 2.

10 days after demand therefor by the collector.

2. If you are engaged in business and keep books of account which are regularly

8. If you pay in cash, do not fail to get a receipt at the time of payment. If you

closed each year at the end of some month other than December to determine your

pay by check or money order, your canceled check or your money order receipt will

annual profit or loss, you may, after obtaining the collector’s approval, make a return

serve as a receipt.

covering the period from January 1, 1918, to the date on which you closed your books,

and thereafter for each period of 12 months.

XI. PENALTIES.

3. If you make a return for a part of the calendar year 1918, your personal exemption

shall be as many twelfths of the amount that would be allowed for a full year as there

For making False or Fraudulent Return.

are months in the period covered by the return.

4. The dates on which the period covered by the return begins and ends, if other

Not exceeding $10,000 or not exceeding one year’s imprisonment, or both, in the

than the calendar year 1918, must be plainly stated at the head of the return; answers

discretion of the court, and, in addition, 50 per cent of the tax evaded.

to questions 5, 6, and 7 must be given for that period; and the affidavit must be changed

accordingly.

For Failing to Make Return on Time.

Not more than $1,000, and, in addition, 25 per cent of the amount of tax due.

For Failing to Pay Tax When Due.

Five per cent of the amount unpaid, plus 1 percent interest for each full month

during which it remains unpaid.

Form 1040a - Individual Income Tax Return - 1918 Page 5

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