New Britain Herald Newspaper, December 17, 1927, Page 14

Let No Income Tax Sharks Take™ You for Your Share of 1928’s Billions be something just a wee bit shady about the proposition, he at any rate agreed to Uncle Sam Says: O ¢ LR AR 77 L e TR i 2 » FITYPITERNS P EF P ST ETINT S 207 . 559 ¥ B o T TTTERT = S 2ty ; b i i - ! i F 4 k A T OO AT I T 0 T ritomsyes o 0m0 78 R RN R T 50 AR S0 M, % g i it > How Fake ' Fixers Prey on Persons Who Fear a Check on Their Returns EARNS HER WAY. Anita Loos (Mrs. John Emerson) Doesn’t Have to Ask Her Husband for Money. Wh She Has So Much, t with Royalties from Her Successful Book, “Gentlemen Prefer Blondes,” Her Plays and Movie Scenarios, That Uncle Sam Receives Mrs. Vincent Astor, is One of the Outstanding omen Contributors on Uncle Sam’s Income Tax List. ERE is another of the series of articles giving “inside” pictures of the workings of the United States Government, written exclusively for Through personal contacts with before made public. Today he sets ing wheels within wheels. Also OOR old, rich Uncle Sam! He has as they have theirs in paying it. porations against paying too muc sharks within his own ranks, it’s a wonder for him when you know that in the course collected $2,219,952,443. What sweet lection of approximately two billion iron this newspaper by the famous Wash- ington correspondent, Hardie Meakin. higher officials Meakin is given access to files and records never before you the drama of the income tax, its humor, thrills and astonish- some startling statistics. By HARDIE MEAKIN. P his troubles garnering the income tax from his faithful subjects—just What with battalions of clever lawyers trying to ‘“‘protect” wealthy men and cor- the necessity of an “Intelligence Uni stamp out the dishonesty of income tax the old gentleman can sleep at nights. But perhaps you won't feel so sorry of time he has managed to collect thirty one billion dollars, and that last year he sums! This year he will make another col- men, as the boys around the Department of Justice phrase it. a Good Slice of It in Tax. When you consider the monumental task of collecting the tax, checking the returns and straightening out the moun- tains of data it's amazing that the process goes off as well as it does and with so few cases of flagrant dishonesty. Because, by and large, rge and small, and taking everything into con- sideration, Americans do pay. They may pay with the ardent enthusiasm of a cow with a ring through its nose follow- ing a rope, but they PAY. Your Uncle Sam has the figures (and the cash) to prove it. Income tax returns fit into three classes at the collectors’ offices—those that are properly prepared and indicate that no further audit is nece ; returns that can be adjusted by an office audit; and returns that require an investigation of the books and records of the taxpayers. These of the third group are the stickers, they are the ones that force the Income Tax Bureau to watch the honesty of its own workers. The most prevalent form of “taking" the innocent or dodging taxpayer from within is accomplished by the dishonest Government auditor, who makes a ‘““tie-up”” with an outside man. The out- side man then goes to a rich and perhaps delinquent taxpayer and tries to ‘‘shake him down” by virtue of possessing inside information. The Department of Justice co-operates with the Income Tax Bureau on fraud cases. Recently one of the Department operators visited a large corporation in New York City and asked one of its offi- cials for certain information and help on 2 tax case. The official was indignant. “Why should we help the Government?” he asked, virtuously. “when in the next room one of the Government’s representatives is at this moment trying to shake us down?” The Government representative “in the next room’" is no longer on the pay- Another such instance involved a re- tired busin man in Florida. He re- ceived a letter informing him that the Bureau of Internal Revenue would soon assess him an additional $250,000. The signature of the man ‘“engaged in tax work,” as he styled himself. showed that he was not connected with the bureau. What to do? The information in the letter disclosed that the writer knew hing of the retired business man's and apparently had something m. A week later another letter arrived “It” or Studied Beauty Girls at Middlesex, England, in an Exhibition of High Spirits. Contr. Their Impulsive Wav Fas Hands with the Studied Esthetic Arm Movements of the German Girle at Right. “PAID BY INDIVIDUALS, (% 91,939,91) This Big Bag Shows the Divisions in Last Year's Income Tax, as Paid by Corporations and Individuals. Analyzed by an Expert from U. S. Treasury Statements, informing the e would come to else the same A financier that if ngton or arrang with the man tax work” (with all expenses pa therc would be a plan unfolded whereby the trifle of $250,000 might be er—adjusted The Washington meeting was ar- ranged, but it merely led to more bad news. There the *‘tax expert” revealed that three bus £ iates of the Florida man were also involved in the Government’s plan of assessment, and that the four would be taxed in ex of $1,250,000. However, the “expert” reassured the frightened Floridan. With an airy wave of his expensive gift-cigar he satd there from SUCCESSFUL. Ma Rinehart, Whose Mystery Storis a Best Seller and An Outstanding Income Tax Payer. Robert: , Plays and Novels Have Made Her BEAUTY TO DOLLARS. Neysa McMein, the Artist, Has Made a Fortune Creating Beautiful Girls for Magazine Covers, but Uncle Sam Has Taken Dollars in Tax Payments. HEADS THE LIST. John D. Rockefeller, Jr., Uncle Sam’s Leading He Contributes Annually a Sum Well Over Six Million Dollars. Payer of Income Taxes. was no need to worry, that he had a friend in the Income Tax unit who was handling those particular cases, and that if the proper approach was made there migflt be an er—adjust- ment—unofficial, of course—where- by the whole matter could be closed for $160,000. If the Florida man had an ink- ling at this point that there might Which Really Counts? T the right are German girls waving their hands rhythmically in a dance. At the left 2 Sngl 3 L Is make a beautiful effect. English of seeking an effect, are attractive, too. without They have “it.” it. There were other confer- ences and the returns filed by the four rich men were smug- gled from the Treasury De- partment, juggled by the “ex- pert,” and returned. At this point a member of Uncle Sam’s Intelligence Unit took the trail. He brought the “expert’” and his friend, the bureau employee, together for a questioning. When cornered the ‘‘ex- pert” confessed s liciting a bribe. The bureau em- loyee said he oaned the papers to a friend who was studying in- come tax proced- ures. Both these bright boys are now serving prison terms. The Flori- da man is appar- ently still in Flor- ida. It was a case similar to this, but on a much larger scale, that led to the formation of t h e Intelligence Unit, and gave it its first assignment in 1918. The Unit uncovered in New York City a firm of ac- countants who had assisted taxpayers in making 200 fraudulent returns. In con- sequence these taxpayers were assessed more than $1,000,000. However, Uncle Sam does not want you to think that dishonesty among tax- oayers is widespread or that he has much trouble in that way with his auditors and collectors. To give that impression would not be fair to the many honest and com- petent Government employees. Commis- Henry Ford Comes Second on the Government Income Tax List, With a Contri- bution Close to Three Million Dollars. sioner D. H. Blair declares that examples of wrongd ing are small compared with the number of men em- ployed. From July, 1, 1919, to June 30, 1927, prosecution was instituted against 445 taxpayers, and special and revenue agents jointly recommended the assess- ment of $143,871,095 in additional taxes and pen- alties in fraud cases. The conclusion on this phase of tax collection is that Uncle Sam wants you to pay your taxes, but that he is just as insistent that the whole thing shall be ac- cording to the proper rules, and that income tax sharks, both within and outside the bureaus, shall not be permitted to “take” you for your share of the two billions that his agents will collect from you this year. He means to have the money that is due—don’t make any mistake about that —and he is becoming increasingly clever about getting it. Congress, while trying to reduce taxes, is at the same time tight- ening up the law to collect on taxable HELPS UNCLE SAM. Mrs. E. H. Harriman, Famous Club, Society and Professional Woman, Whose Large Income Is Heavily Assessed Under the Present Income Tax Law. incomes. The 1926 law contains a section 0 to be exact—that makes it possible for your Uncle to follow through any money that is being withheld, without resorting to a procedure of law. This could not be done prior to the passing of the law. Up to June 3 last, internal revenue agents had classified more than 2,000,000 income tax returns on earnings of 1926. More than two-thirds of th were ac- cepted as the taxpayers filed them, a pretty good record. But the other one- third—they afford most of the work for Uncle Sam’s 2,674 field agents, You may have wondered what becomes of your income tax return after it reaches Washington. In former years when you filed it you did so in the hope that it was a correct and closed incident. Then it sometimes happened that you were in- formed three or four years afterward that it was incorreet. This has been Bureau advises y ceived whether A preliminary audit is made at the office of the collector where the return is filed. Prior to reaching Washington a large percentage of returns are filed as accepted. Field agents check others. Records disclose that 98 per cent of the taxp: affected agree to the audit of the field men. When the taxpayer does not agree his protest is forwarded to the revenue agent in charge. Uncle Sam has several methods of checking up on those who might try to avoid the tax. One is the requirement that every employer report cach person on his payroll with a salary of 1,000 an- nually, or more. Other checking is done by canv s of soure of information where data is compiled, which can be com- pared with the income tax return of the individual. You may be interested to know that Uncle Sam’s first plan for an income tax law was called to the attention of Con- gress back in 1815, to help pay for the war of 1812, The suggestion was not taken up, howeve., and it wasn’t until 1861 that an income tax law became a_ fact. Since then the law has been kicked in and out of Congress a number of times, has been the cause of bitter de- bates, and has been subjected to many changes. . In addition to furnishing Uncle $am with a tidy sum in revenue the income tax law leads to his acquiring valuable information about his subjects. He knows how many millionaires there are, how many individual stockholders in cor- porations, how young citizens are growing up, and so on. In fact, with the Income Tax, Volstead and other laws it’s awfully hard to keep any secrets from him nowadays. Now the is re- anged. N u soon after i is correct. These Girls Make a Beautiful Impression Together Because They Are TRAINED to Be Beautiful in Unison. Girl Students at a Berlin Dancing School Learning an Esthetic Exercise That Gives Them Freedom and Grace of Gestare. L o i i