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2 HASKINS & SELLS January Concerning the Revenue Act of 1924 TAXPAYERS throughout the country recently were startled when the publicity features of the Revenue Act of 1924 were brought to their attention by the public press. For many months prior to the passage of the Act it was known that Congress would eventually demand a certain degree of publicity in the tax affairs of the country, and the extent thereof was clearly and definitely indicated on June 2, 1924, when the President affixed his signature to the completed law. Yet the startled surprise and indignation were apparently as great as might have been expected had no previous knowledge existed that such announcement must of necessity be made to comply with the requirements of the new Act. Is it not possible that other changes in the new law equally important to the taxpayer have failed to receive the attention they deserve? The intent of the Revenue Act of 1924 is to give relief to the individual taxpayer. Such benefit as results to the corporate taxpayer is incidental to the tax reduction to the individual. In the following brief summary of the changes effectuated it will be noted that in nearly every instance it is the individual who receives the relief. The immediate benefit of the new law was the reduction of the 1923 taxes of individuals to the extent of 25 per cent. Such reduction cannot be applied to the taxes for 1924, for which year a reduction in normal and surtax rates gives a substantially equivalent relief. Beginning with the 1924 return, the normal tax on the first 34,000 of net income in excess of the exemptions is reduced from 4 to 2 per cent. The tax on the next 34,000 is 4 per cent. instead of 8 per cent., and on income in excess of $8,000 the rate is reduced from 8 per cent. as fixed by the 1921 Act, to 6 per cent. The very material mitigation in the tax burden of the great mass of small taxpayers is vividly revealed when it is considered that 6,400,000, or over 96 per cent., of the 6,650,000 personal returns filed for the calendar year 1921, were filed by individuals having incomes of not over $8,000. Relief is also extended in a more limited degree to individuals with higher incomes. Surtaxes formerly began with 1 per cent. at $6,000 and reached 50 per cent. at $200,000. The rates now begin with 1 per cent. at $10,000 and increase to 40 per cent at $500,000, the greatest benefit enuring to incomes of $100,000 and over. For the calendar year 1921 less than one-half of one per cent. of the personal returns filed reported income of the latter amount. Additional relief is given the taxpayer through removing the limitation on the exemption of $2,500 for married persons and heads of families, the full deduction
Object Description
Title |
Concerning the Revenue Act of 1924 |
Author |
Anonymous |
Subject |
United States. Revenue Act of 1924 Taxation -- United States |
Citation |
Haskins & Sells Bulletin, Vol. 08, no. 01 (1925 January), p. 2-5 |
Date-Issued | 1925 |
Source | Originally published by: Haskins & Sells |
Type | Text |
Collection | Deloitte Digital Collection |
Digital Publisher | University of Mississippi Libraries. Accounting Collection |
Date-Digitally Created | 2009 |
Identifier | HS Bulletin 8-p2 |