When Taxes Were Simple

Excerpts from the March 1, 1919 edition of THE MOHAVE COUNTY MINER AND OUR MINERAL WEALTH. Daniel C. Roper, Commissioner of Internal Revenue at the time, basically describes the whole tax code in a couple paragraphs:

The normal rate of tax under the new act is 6 per cent of the first $4,000 of net income above the exemptions, and 12 per cent of the net income in excess of $4,000. Incomes in excess of $5,000 are subject also to a surtax ranging from 1 per cent of the amount of the net income between $5,000 and $6,000 to 5 per cent of the net income above $1,000,000.

In addition to the $1,000 and $2,000 personal exemptions, taxpayers are allowed an exemption of $200 for each person dependent upon them for chief support if such person is under eighteen years of age and incapable of self-support. Under the 1917 act, this exemption was allowed only for each dependent “child.” The head of a family who supports one or more persons closely connected with him by blood relationship, relationship by marriage, or by adoption is entitled to all exemptions allowed a married person.

Payment of the tax may be made in full at the time of filing return or in four installments, on or before March 15, on or before June 15, on or before September 15, and on or before December 15. Revenue officers will visit every county in the United States to aid taxpayers in making out their returns. The date of their arrival and the location of their offices may be ascertained by inquiring at offices of collectors of internal revenue, post-offices and banks. Failure to see these officers, however, does not remove the taxpayer of his obligation to file his return and pay his tax within the time specified by law. In this case taxpayers must seek the government, not the government the taxpayer.

Then he describes what the penalties were for failing to pay:

Any person who deliberately conceals tax liability, or who falsified a return in order to reduce or evade any internal revenue tax, or who deliberately abets such concealment or fraud finds arrayed against him the entire strength of this bureau, pressing for the full civil and criminal penalties. That is the attitude toward the tax-evader, expressed in one sentence. Whether he is a moonshiner, a stealthy trafficker in habit-forming drugs, a juggler of income figures, a delinquent in making the sworn return the law requires, or a revenue violator of any kind, the bureau is charged with the duty of hunting him out and exacting the full punishment provided in the law.

Here is what will happen to them if they don’t for failure to file a return on time, a fine of not more than $1,000 and an additional assessment of 25 per cent of the amount of tax due. For “willfully refusing” to make a return on time, a fine not exceeding $10,000, or not exceeding one year’s imprisonment, or both. For making a false or fraudulent return, a fine of not more than $10,000, or imprisonment for not more than one year, or both, together with an additional assessment of 50 per cent of the amount of tax evaded. For failure to pay the tax on time, a fine of not more than $1,000 and an additional assessment of 5 per cent of the amount of tax unpaid, plus 1 per cent interest for each full month during which it remains unpaid.

See the full article here.

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