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APPENDIX

ILLUSTRATIONS OF RETURNS

On the following pages are shown illustrations of returns under varying conditions.

Pages

1040-1041

1942–1044 1045-1048 1049-1052

Individual:
Married man (citizen), i child (under 18), no surtax. Calen-

dar year-cash basis...............
Unmarried (citizen), subject to surtax. Calendar year-

cash basis......................................... Retired manufacturer (citizen), married, no normal tax,

subject to surtax. Stock dividends received direct.. Merchant (citizen), married, subject to surtax. Liberty bond interest ........

...... Married man (citizen), 2 children (under 18 years), subject

to surtax, having one-half interest in partnership. In-
come from stock dividends taxable at 1913-1915, 1916,
1917, 1919 rates. Income from partnership taxable at

1918-1919 rates (fiscal year ending September 30, 1919) Married (citizen), no children, subject to surtax. Cash

dividends received from domestic and foreign corpora-
tions. Tax paid to foreign country. Fiscal year ended

October 31, 1919. .................................
Married (citizen), I child under 18 years, normal tax only.

All income from "tax-free" bond interest.........
Illustration showing income from Liberty bond interest re-

ceived through partnership and calculation of exemp-
tions-partner with one-fourth interest in profits......

1053–1055

1056-1057

1058

1059–1060

1061-1062

Corporation:
Schedule A, Form 1120. Taxable net income. Calendar

year 1919......
Schedule M (old form, Schedule B), Form 1120. Recon-

ciliation of taxable income with books of account.

Calendar year 1919............................... Schedule A, Form 1126. Taxable net income, three com

panies, consolidated. Calendar year 1919........... Schedule M (old form, Schedule B), Form 1120. Recon

ciliation of taxable net income with books of account,

three companies, consolidated. Calendar year 1919... Calculation of income tax for fiscal year ended March 31, 1919...................

: Schedule showing reconcilement of book net income with

net income subject to income and excess profits ta’es.

1063-1064 1065-1067

1068–1069

1070

1071-1072

SUGGESTED DRAFT STATEMENT TO BE PREPARED BY INDIVIDUAL TAXPAYER BEFORE

FILLING IN FORM 1040 A
MARRIED MAN (CITIZEN), 1 CHILD (UNDER 18 ). No surTAX. CALENDAR YEAR-CASH BASIS.
SchedulE DETAILS OP INCOME:
& ITEM
Gift from father......

0.00 Do not report
B - Col. 4 Salary......

$2,500.00
I-5
Deduction for business expenses.....

300.00 $2,300.00
Profit on sales of stocks .....

$ 200.00
Losses on sales of stocks. ....

800.00
Deductible..

600.00

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Rents. ...
Deduction for real estate expenses ......
Deduction for depreciation of buildings.........
Deduction for interest on mortgage. .......
Deduction for real and personal property taxes....

$150.00
350.00
500.00
100.00

1,100.00

500.00

Interest on First Liberty Bonds, 33%.......

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Interest on Second Liberty Bonds, 4% (principal $15,000)....
Interest on Third Liberty Bonds, 44% (principal 82,500)...
Interest on Fourth Liberty Bonds, 4%% (principal $10,000)....

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Interest on corporate bonds containing "tax-free" provision.....
Interest on corporate bonds containing no "tax-free" provision....
Cash dividends received. ........
Income as partner, net distributive share .....

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Total Income..:::..!
Deduction for interest paid on money borrowed to purchase or carry Second,

Third and Fourth Liberty Bonda
Interest paid on money borrowed to carry First Liberty Bond......

.54.00

100.00 Do not report

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Deduction for State Income Tax..
Deduction for Bad Debt (loan to friend in 1917, considered good January 1,
1919).........

Net Income before deducting contributions .....
Total amount contributed to charities during 1919 (give details)........

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Amount allowable is 15% of net taxable income, viz., income as above......

15% thereof..

I-4

729.00

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Net Income subject to Normal Tax..
Exemption $2,000 plus $200.

$3.531.00
1,200.00

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$53.34

8.00

Normal Tax at 4%...
Credit tax paid at source on "tax-free" bonds“ .....

Net Tax due........
Note: Inasmuch as net income did not exceed 85,000 no surtax is payable.

$45.24

Exempt from all Federal income tax. 'Interest is exempt owing to $10,000 Fourth Liberty Bonds being originally subscribed for and still hold. 'Interest to extent of $5,000 of principal any issue, exempt. No Fifth Victory Bonds originally subscribed for. Not included as income, as required by Art. 31, Reg. 45. See Page 414.

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