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TREASURY DEPARTMENT Washington FOR RELEASE* MORNING NEWSPAPERS, Monday. March 2. 1943, Press Service No. 30-47 Secretary of the Treasury Morgenthau today made public preliminary statistics of individual income and defense tax returns and taxable fidueiaty income and defense tax returns for 1940 filed in the period January through June, 1941, prepared under the direction 6f Commissioner of Internal Revenue Guy T. Helvering. The prelim- inary report, Statistics of Income for 1940, Part 1, will be published at a later date* TAXABLE AND NONTAXABLE RETURNS* TAXES* NET INCOME AND DEFICIT The total number of returns is 14,475,740, of which 7,389,317 are taxable returns with a total tax liability of $1,494,138,904, and 7,086,423 are nontaxable returns. Of the 7,389,317 taxable re- turns, 7,325,782 are individual returns with net income, 63,489 are fiduciary returns with net income, and 46 are individual returns with no net income (see Tables 1 and 1A). For the 7,363,715 returns with normal tax and surtax liabilities, the normal tax is $403,433,975, the surtax is $425,011,869, and the defense tax is $81,401,469. Tor the 25,602 returns with alternative tax liability, the alternative tax is $537,274,655 and the defense tax is $47,016,936, Of the 7,086,423 nontaxable individual returns, 7,020,355 show net income and 66,068 show no net income. ~ 2 - There are 14,409,626 individual and taxable fiduciary returns showing a net income of $36,231,054,014 and 66,114 individual returns showing a deficit of $244,555,382. Jor all returns with net income, the average total tax is $104 and the effective tax rate is 4*1 percent. For taxable returns with net income, the average total tax is $202 and the effective tax rate is 6.4 percent. The increase or decrease, 1940 over 1939, for the number of returns and certain items reported on individual and taxable fiduciary returns, is given on page 3. Preliminary data for individual returns and taxable fiduciary returns* Increase or (decrease), 1940 over 1939» for number of returns, net income, deficit, and taxes (Money figures in thousands of dollars) Increase or 1 (decrease), 1940 over 1939 1940 1939 Number or amount All individual and taxable fiduciary returns: Number of returns Net income 1/ less deficit Total tax liability 14,475,740 35,986,499 1,494,139 7,568,772 22,010,935 910,814 6,906,968 13,975,563 583,325 91.3 63.5 64.0 403,434 435,012 537,275 128,418 282,190 308,721 319,903 121,244 116,291 217,372 43.0 37.7 67.9 Normal tax Surtax Alternative tax 2/ Defense tax 3/ Taxable individual and fiduciary returns: With net incomei Number of returns Net income 1/ Total tax liability Nonnal tax Surtax Alternative tax 2/ Defense tax 3/ Individual returns with no net income 4] I Number of returns Deficit Alternative tax Nontaxable individual returns: With net income Number of returns Net income With no net income: Number of returns Deficit 1/ 2/ 3/ See note 1, page 14. See note 4, page 14. See note 5, page 14t Percent - - - | i i j 7,389,271 | 23,418,412 i 1,493,666 i i 3,896,607 15,454,272 910,513 3,492,664 7,964,139 583,153 89.6 51.5 64.0 403,434 425,012 536,802 128,418 282,190 308,721 319,602 121,244 116,291 217,200 43.0 37.7 68.0 46 2,551 473 18 1,130 301 - - - \ j 1 28 1,421 172 155.6 125.7 56.9 i 3,591,097 ! 7,020,355 6,835,579 j 12,812,642 j 66,068 ! 81,050 242,005 1 277,786 || • ! I 3,429,258 j 95.6 5,977,063 j 87.4 (14,982) j (18.5) (35,782); (12.9) i 4/ Consists of returns with no net income and with net long-term capital loss. On these returns the tax, computed on net income "before the deduction of net longterm capital loss, exceeds 30 percent of the net long-term capital loss* 5/ See note 7, page 14. EJJTUEirS INCLUDED AND DAJA TABULATED The returns cohered by this release are fox the income year 1940 filed in the period January through June, 1941 under the provisions of the Internal Eevenue Code as amended. Included are individual returns, Forms 1040, 1040A and 1040B, and taxable fiduciary returns, Form 1041, filed for estates and trusts. The returns are, in general, for the calendar year ending December 31, 1940. However, a negligible number of returns for a fiscal year, other than the calendar year, ending within the period July 1940 through June 1941, is included with the calendar year returns for 1940. There are also included part year returns for which the greater part of the accounting period falls in 1940. The statistics are taken from the returns as filed by the taxpayer, and prior to any revisions that may be made as a result of audit by the Bureau of Internal Bevenue. Amended returns and tentative returns are not included in the tabulations. Data from all taxable fiduciary returns, from individual returns with net income of $5,000 and over, and from certain individual returns with no net income are tabulated from each such return. Data for individual returns with net income of less than $5,000 are partly estimated and partly tabulated. Data for nontaxable individual returns with net income and for individual returns with no net income are included in the attached tables because of certain legal requirements regarding the filing of returns. CHANGES IH PROVISIONS OP THE INTERNAL M S V M U E CODE The Revenue Act of 1940 emends certain provisions of the Internal Revenue Code which are applicable to all returns included in this release with taxable year beginning after December 31, 1939, and therefore are not applicable to the negligible number of returns in this release for a fiscal /ear or part year beginning in 1939. The four major changes in the Internal Revenue Code as amended, affecting individual and fiduciaiy returns are: (l) new requirements for filing returns; (2) reduction of personal exemption; (3) increased surtax rates, applicable to surtax net incomes in excess of $6,000 and not in excess of $100,000; and (4) imposition of a defense tax of 10 percent of the total income tax, but not in excess of 10 percent of the amount by which the net income exceeds the income tax. Comparisons, for 1940 and 1939, of the requirements for filing returns and of the personal exemption are given on page 6. ~ 6 - Requirements for filing returns 1940 Individuals, married and living with husband or wife for the entire taxable year* Het income (l) Gross Income of either or both regardless of amount of net income $2,000 Individuals, single, or married and not living with husband or wife; and estates: Net income (l) Gross income regardless of amount of net income,.. 800 Trusts: Set income. 100 800 Grross income regardless of amount of net income... (A return is required for every trust of which any beneficiary is a nonresident alien.) Personal exemption Individuals, married and living with husband or wife, or head of family Individuals, single, or married and not living with husband or wife, and not head of family; and estates. Trusts, credit allowed against net income in lieu of the personal exemption 1939 $2,500 5,000 1,000 5,000 100 5,000 1940 1939 $2,000 $2,500 800 1,000 100 100 The 1940 returns are the first to show the net operating loss deduc*~ tion allowed partners and sole proprietors (see section 23(s), Internal Revenue Code—added by the Revenue Act of 1939). DESCRIPTION OP TABLES In fables 1 and 2 there are presented certain composite data for individual returns and taxable fiduciaiy returns, with net income, classified by size of net income, and data for individual returns with no net income. Tables 1A and 2A contain data for individual returns only. 1/ Requirement for filing return governed by amount of gross income. - ? - In Tables 1 and 1A, presenting data classified by taxable and nontaxable returns, there are shown the following items for each classification to which the items are applicable: Number of returns, net income, personal exemption, credit for dependents, earned income credit, total tgx, nonnal tax, surtax, alternative tax, defense tax, average total tax and effective tax rate. Tables 2 and 2A show number of returns, sources of income and deductions, and net income. SOURCES OF INCOME AND DEDUCTIONS Income from the various sources represents the net amount by which the gross receipts exceed the deductions, as reported in the schedules on the return, and in aggregate represents the sum of the net amounts of income from each source. Net losses reported under ^Income1* items on the face of the returns are transferred in tabulation to deductions, and are included with the amounts reported under specified or other deductions. Deductions do not include credits, such as personal exemp- tion, credit for dependents, and credit for earned income. Table 1. - Individual returns and taxable fiduciaiy retains, 1940 — Taxable individual and fiduciary returns with net income by net income classes and individual returns with no net income j Nontaxable individual returns with net incone by net income classes and with no net income* Number of returns, net incone, personal exemption, credit for dependents, earned income credit, total tax, normal tax, surtax, alternative tax, defense tax. average total tax, and effective tax rate (Returns filed in period January through June, 1941) (Met income classes and money figures, except average total tax, in thousands of dollars) Taxable and nontaxable returns by net income 2/ classes Romber of returns (col. 8 Met income 1/ (col. 9 • 15) Personal tion 2/ •U) (5) (1) 1 2 5 4 5 6 7 8 9 10 11 l Taxable individual and fiduciary returns l/» lith net incomes Under 5 (estimated) 5 under 10 10 under 25 25 under 50 50 under 100 100 under 150 150 under 500 500 under 500 500 under 1,000 1,000 and over Total (4) Credit for dependents (individual returns) (5) Earned 1nmr> credit (individual returns) Total tax Mumber (col. 10 • 16) of returns (8) (7) (6) 6,629,875 525,864 185,565 56,275 10,581 1,945 1,125 264 128 SI 14,527,656 5,509,709 2,726,942 1,225,488 693,111 255,477 225,008 100,544 84,224 94,252 7,797,655 901,587 505,079 57,749 16,281 2,912 1,711 412 171 78 552,599 1,417,128 215,875 278,127 74, 811 156,652 15,857 54,659 5,859 10,554 657 1,866 574 1,014 88 220 55 95 14 56 7,589,271 25,418,412 9,085,657 842,147 1,900,111 Returns with normal tax and surtax £/ Met Tax liability income 1/ Normal Surtax Total (col. 11 tax • 12 • 1») (9) Defense tax §/ (10) (11) (12) 253 22,041 152,071 109,250 81,445 27,817 24,406 9,555 10,254 7,941 19,118 10,597 21,697 15,502 9,528 5,040 2,461 7S5 597 526 9 10 425,012 81,401 11 210,465 116,818 247,856 264,108 244,986 109,597 121,982 60,496 51,175 66,186 6,629,858 14,527,617 523,825 5,509,598 182,994 2,672,270 21,640 715,520 4,476 294,526 587 70,546 259 51,497 47 17,548 24 16,624 7 11,665 210,501 116,655 258,695 148,557 101,945 55,601 28,891 10,978 8,755 190,930 84,00.7 84,925 25,806 11,172 2,745 2,024 688 662 466 1,495,666 7,565,715 21,886,812 909,847 405,434 ii, as (15) 1 2 5 4 5 6 7 8 oo 12 Individualreturnswith no net income 6/ 46 2/2,551 67 5 54 475 IS Total, taxable returns 7,589,517 18/25,415,861 9,085,704 842,155 1,900,145 1,494,139 7,020,278 77 12,812,254 12,795,952 409 150 2,907,110 196 1,007,882 26 - - - - - - - 7,020,555 12,812,642 12,796,062 2,907,506 1,007,909 - - - - - - - 16 14 15 16 17 Nontaxable individual returns: Tith net income 7/s Under 5 (estimated) 5 under 6 Total Individual returns with no net income 8/ - - 7,565,715 21,886,812 - 909,847 - 405,434 - 425,012 - 81,401 12 IS 14 15 66,068 9/242,005 (11) (11) (U) - - - - - - - 17 IB Total, nontaxable retains 7,066,425 10/12,570,658 (11) (11) (11) - - - - - - - 18 19 Grand total (IS plus 18, or 20 plus 21) 14,475,740 12/85,966,499 (11) (11) (11) 1,494,159 7,565,715 21,886,812 909,847 403,434 425,012 81,401 19 5,749,455 2,908,019 1,495,666 7,363,715 21,886,812 909,847 405,454 425,012 81,401 20 (11) (11) 20 Individual retains and taxable fiducial? retains with net income (11 plus 16) 14,409,626 ZL Individual returns with no net income (12 plus 17) 66,114 For footnotes, see pages 14 and 15. 56,251,054 21,879,719 9/244,555 (11) 475 - - - - - - 21 Table 1. - Individual retsai and taiaMe fiduciary retains, 1940 — Taxable individual and fiduciary returns villi net inccae bj net inews dtiMi and individual rsturns with no M t ineoaej Wont.sTahle individual returns with net Incoae hgr net incoas classes and vith no net inoonet Huaber of returns, net incoae, personal exaaption, credit tor dependents, earned incase credit, total tax, normal tax, surtax, alternative tax, defense tax. average total tax, and effective tax rate - Continued (Rbturns filed in period January through June, 1941) (let incoae classes and money figures, except average total tax, in thousands of dollars) 1 2 5 4 5 6 7 8 9 10 11 12 IS 14 15 16 17 Taxable and nontaxable returns by net incoae 1/ classes Kosher of returns (1) (14) Taxable individual and fiduciary returns l/« Uth net Incoae» Under 5 (estijMted) 5 under 10 10 under 25 25 under 50 50 under 100 100 under ISO 150 under 300 500 under 500 500 under 1,000 1,000 and over Total Individual returns with no net incoae 6/ Total, taxable returns Nontaxable individual retnxnss With net Incoas 2/t Ubder 5 (estimated) 5 under 6 Total Individual returns with no net incoas £/ 18 Total, nontaxable returns 19 Orand total (15 plus IB, or 20 plus 21) (15) (16) (18) (17) Average total tax (col. 7 f 2) (19) 17 41 2,571 14,655 5,905 1,558 864 217 104 44 59 512 54,672 506,168 596,584 162,951 175,511 85,197 67,600 82,587 162 165 9,165 115,571 145,041 75,996 95,091 49,518 59,600 S7,455 162 150 8,556 105,066 150,066 69,185 85,556 46,252 57,206 55,044 1 t 52 14 225 827 1,557 10,505 7,281 12,975 25,599 6,811 56,548 7,755 108,622 5,266 229,152 2,454 599,787 2,410 1,297,775 25,556 1,551,600 585,819 556,802 47,017 46 9/2,551 475 475 25,602 10/1,529,049 SB4,292 557,275 - 47,017 202 Effective tax rate, percent (returns with net incoae) (col. 7 4 5) (20) 1.45 5.55 9.09 21. 59 55.54 46.94 54.21 60.17 60.76 70.22 10 6.58 11 1 2 10,282 - 12 202 - 15 - - - - - - - 14 15 - - - - - - - 16 - - - - - - - 17 - - - - - - - 18 _ 19 4.12 20 25,602 ISA, 529,049 584,292 557,275 47,017 585,819 556,802 47,017 475 475 20 Individual returns and taxable fiduciary returns with net Inccae (11 plus 16) 25,556 21 Individual returns with no net Incoae (12 plus 17) 46 For footnotes, see pages 14 and 15. Rs turns vith alternative tax 4/ Vet Tax liability inccae 1/ AlternaTotal Defense (col. 17 tive tax tax y • 18) 1,551,600 - (12) 104 (12) - 21 Table 1-A. - Individual returns, 1940 — TlMfrlft nffntaMfrlftj with net income by net income classes, and with no net incomej Number of returns, net income, personal exemption, credit for dependents, earned income credit, total tax, normal tax, surtax, alternative tax, defense tax, average total tax, and effective tax rate (Returns filed in period January through June, 1941) Taxable and nontaxable returns by net income classes fl) Number of returns (col. 8 • 14) Net incone (col. 9 + 15) (2) (3) Personal Credit for dependents tion^g/ (4) (5) Earned income credit Total tax (col. 10 • 16) (6) 9 10 6,576,362 518,633 182,139 35,295 10,032 1,851 1,059 250 112 49 14,460,029 3,473,609 2,677,980 1,190,075 669,471 222,179 212,366 94,933 74,170 87,746 7,778,476 901,587 305,079 57,749 16,281 2,912 1,711 412 171 78 532, 599 1,417,128 278,127 215,873 156,632 74,811 34,639 13,857 10,354 3,859 1,866 637 1,014 374 220 88 95 35 36 14 11 Total 7,325,782 23,162,557 9,064,457 842,147 12 With no net income 6/ 8 13 14 15 Total, taxable returns Nontaxable individual returns) With net income 7/j Under 5 (estimated) 5 under 6 16 Total 17 With no net income 8/ (8) (7) Taxable individual returns* With net income i Under 5 (estimated) 5 under 10 10 under 25 25 under 50 50 under 100 100 under 150 150 under 300 300 under 500 500 under 1,000 1,000 and over 1 z 5 4 5 6 7 1,900,111 Returns with nomal Net Income Total (col, 11 • 12 • 13) Number of returns (9) tax and surtax 3/ Tax liability Surtax Normal tax (10) (11) Defense tax 5/ (15) (12) 208,192 114,639 242,090 256,240 236,481 104,506 115,794 57,480 46,138 60,805 6,576,345 14,459,991 518,593 3,475,506 179,846 2,625,105 21,002 693,842 4,294 282,495 551 66,153 236 47,109 46 16,965 22 15,064 6 9,804 208,030 114,479 235,255 145,570 97,601 51,459 26,450 10,755 10,420 7,551 188,885 82,680 85,117 24,967 10,699 2,572 1,850 675 600 591 254 21,400 128,916 105,552 77,967 26,042 22,555 9,542 9,275 6,665 18,912 10,599 21,202 15,051 8,955 2,845 2,247 720 545 275 1,442,366 7,300,941 21,689,832 883,289 396,433 407,726 79,131 46 9/2,551 67 5 34 473 7,325,828 10/23,160,006 9,064,524 842,153 1,900,145 1,442,839 7,020,278 77 12,812,234 12,795,932 409 150 2,907,110 196 1,007,882 26 - 7,020,355 12,812,642 12,796,082 2,907,306 1,007,909 - 66,068 9/242,005 (11) (11) (11) - - ~ 7,300,941 21,689,832 - - - 885,289 - - 396,433 - 407,726 - 79,151 - - - - - - - - - - - - - - - - - - 18 Total, nontaxable returns 7,086,423 10/12,570,638 (11) (11) (11) 19 Grand total (13 plus 18, or 20 plus 21) 14,412,251 10/35,730,644 (11) (11) (11) 1,442,839 7,300,941 21,689,832 885,289 596,455 407,726 79,151 3,749,453 2,908,019 1,442,566 7,300,941 21,689,832 885,289 596,455 407,726 79,151 (11) (11) 20 21 Individual returns with net income (11 plus 16) Individual returns with no net income (12 plus 17) For footnotes, see pages 14 and 15. 14,346,137 66,114 35,975,199 21,860,539 9/244,555 (11) 473 - - - - - - Table 1-A. - Individual re torn a, 1940 — Taxable and nontaxable, with net income by net income classes, and with no net income < Number of returns, net income, personal exemption, credit for dependents, earned inoome credit, total tax, normal tax, surtax, alternative tax, defense tax, average total tax, and effective tax rate - Continued (Returns filed in period January through June, 1941) (Net income classes and money figures, except average total tax, in thousands of dollars) Returns with alternative tax 4/ Taxable and nontaxable returns by net income classes (1) Number of returns Net income (14) (15) Total (col. 17 • 18) Tax liabilityr AlternaDefense tive tax tax (16) (17) (18) Taxable individual returns} With net incomes Under 5 (estimated) 5 under 10 10 under 25 25 under 50 50 under 100 100 under ISO ISO under 500 500 under 500 500 under 1,000 1,000 and over 17 40 2,295 14,295 5,758 1,500 825 204 90 45 59 504 52,875 496,255 586,976 156,026 165,257 77,968 59,106 77,942 165 160 8,855 112,670 158,880 75,047 89,565 46,745 55,718 58,474 162 147 8,055 102,429 126,285 66,492 81,921 45,651 55,572 51,065 1 15 799 10,241 12,596 6,556 7,444 5,094 2,146 2,410 11 Total 24,841 1,472,725 559,077 515,777 45,500 12 With no net income 6/ 46 9/2,551 475 475 24,887 10/1,470,175 559,549 514,250 14 15 Total, taxable returns Nontaxable individual returns} With net income 7/« Under 5 (estimated) 5 under 6 - 45,500 Effective tax rate, percent (returns with net income) (col. 7 * 5 ) (20) (19) 1 2 9 4 5 6 7 8 9 10 15 Average total tax (col. 7 f «) 52 221 1,529 7,260 25,575 56,459 109,545 229,920 411,945 1,240,928 1.44 5.50 9.04 21.55 55.52 47.04 54.55 60.55 62.21 69.50 1 2 5 4 5 6 7 8 9 10 197 6.25 11 * 10,282 - 12 197 - 15 14 15 - - - - - - - - - - 16 16 Total - - - 17 With no net income £/ - - - - - - - 17 - - - - - - - 18 18 Total, nontaxable returns 19 Grand total (13 plus 18, or 20 plus 21) 20 21 Individual returns with net income (11 plus 16) Individual returns with no net income (12 plus 17) For footnotes, see pages 14 and 15. 24,887 10/1,470,175 559,549 514,250 45,300 24,841 1,472,725 559,077 515,777 45,500 46 9/2,551 475 475 - 19 (12) ica (12) 4.01 - 20 21 Table 2. - Individual returns and taxable fiduciary returns, 1940, with net income by net income classes, and individual retains with no net income! / Number of returns, sources of Income and deductions, and net inccmo / (Returns filed in period January through June, 1941) ./ (Net income classes and money figures in thousands of dollars) Net income 1/ classes (1) Individual returns and taxable fiduciary returns 1/ with net incomes Under 5 (estimated) 5 under 10 10 under 25 25 under 50 50 under 100 100 under 150 150 under 500 500 under 500 500 under 1,000 1,000 and oyer Total, individual returns and taxable fiduciary returns with net income Individual returns with no net income §/ Grand total Net income 1/ classes Sources of income Number of Taxable interest Partner- Income returns Salaries, Dividends Rents and Business Capital gain 18/ frop Bank wages, profit 17/ ship from royalties Net longPartially Short-term }?/ domestic deposits, taxprofit 15/fiduciterm capi— notes, sions,etc. and exempt aries 16/ Net short-Prior yearNet short- tal gain (indiforeign mortgages, Governterm capi-net short-term capi25/ vidual corpora- corpora- ment obtal gain term capi- tal gain returns) tions 15/ tion bonds ligations Included tal loss before in col. deducted deducting w 17 20/ col. 12 22/ 21/ (col. 15 (col. 11 • 12) -12) (2) (5) <4) (5) (11) (6) (7) (8) (12) (9) (15) (10) (14) 13,650,155 23,226,490 1,164,201 29/682,656 523,941 2,072,846 134,061 427,679 597,867 123,146 185,565 1,301,580 472,140 413,324 51,812 56,275 215,580 511,415 10,381 23,564 1,945 58,298 7,160 126,763 158,402 5,502 1,123 40,593 10,275 67,859 1,695 264 1,786 128 5,110 50,443 1,499 72,704 51 1,335 14,409,626 27,402,010 3,370,657 1,032,717 66,114 43,252 60,687 17,686 14,475,740 27,445,262 3,431,343 1,050,403 (50) 14,410 18,878 10,151 4,397 1,577 1,134 136 263 8 464,174 544,528 556,050 162,872 87,537 20,352 16,047 5,026 921 1,501 50,934 1,458,807 1,055 8,742 51,989 1,467,548 Total, Individual returns and taxable fiduciary returns with net incoae -Jjdividual returns with no net income £/ Grand total (20) (21) (22) (23) 42,187 25,556 50,574 12,848 6,170 2,029 1,985 1,101 684 388 50,189 21,941 34,019 8,504 43,753 5,951 28,052 1,511 24,999 625 14,658 49 21,142 275 12,288 4 18,732 1 12,964 (51) 612,727 50,067,585 38,183 4,042,856 27,912 5,187,855 11,690 1,449,559 6,680 825,522 1,967 282,422 2,294 274,564 1,201 122,710 428 99,885 297 118,230 772,639 1,184,570 4,071,141 118,872 4,451 123,323 260,778 38,661 703,379 40,464,963 15,027 4,000 282 4,282 784,939 1,210,965 4,084,167 122,872 4,733 127,606 12,500 (24) 26,595 Apnnnt distribuLosses Bad Other Total deducfrom fire, debts 27/ deductable to (indistorm, tions 2§/ tions 2g/ beneficietc. 27/ vidual aries returns) (indi(fiduciary returns) vidual retains) (25) (26) (27) (28) (29) 4,048 Net income 1/ (50) 152,754 68,113 84,037 44,131 22,558 6,257 5,892 2,685 1,161 1,834 22,323 5,492 4,917 2,125 848 261 179 239 174 4 490,881 75,828 62,492 33,281 23,766 10,180 11,730 5,893 6,060 6,847 487,716 103,722 67,034 24,739 12,407 5,176 4,547 1,597 679 1,200 891,733 152,430 128,903 61,800 55,968 12,424 11,789 4,599 5,871 3,952 15,509 4,489 4,238 2,127 1,344 625 465 209 257 195 57,794 15,512 16,164 7,715 5,553 1,748 2,128 1,077 506 787 405,861 2,582,154 67,554 512,125 48,777 436,737 21,238 207,715 15,240 122,615 4,946 44,967 45,167 5,408 2,949 20,560 15,067 1,505 2,116 19,146 145,542 20,613 24,173 12,536 9,796 5,978 4,189 1,805 592 4,851 27,559,890 5,510,118 2,726,942 1,225,486 695,111 255,477 225,008 100,544 84,224 94,252 24,865 122,755 389,422 56,561 726,958 708,818 1,507,470 27,454 88,561 575,394 4,006,055 227,855 56,251,054 19,326 85,152 155,774 27,414 4,319 26,091 7,394 42,212 205,905 545,196 63,975 731,277 753,447 1,355,561 54,847 150,575 44,191 55,648 443,960 627,042 4,450,015 - 2,000 264,825 40,661 68,612 14,689 15,856 8,605 5,883 2,891 1,859 925 1,242 2,211 24,629 (17) 907 885 1,288 800 350 73 98 26 20 6 10,971 4,497 4,319 1,956 1,268 460 1,193 186 11 4 For footnotes, see pages 14 and 15* (19) (16) 41,279 24,675 29,066 12,048 5,820 1,956 1,887 1,075 664 383 Deductions Partner- Business Net long- Net loss Contribu- Interest Taxes loss 17/ term capi-from sale tions 25/ paid 2g/ paid 26/ ship loss !§/ tal loss of prop- (indi18/ £2/ erty other vidual than capi-returns) tal assets (18) (15) Total inoome 832,668 2,850,730 668,397 154,780 115,876 397,425 47,116 115,507 22,242 41,949 5,541 10,401 5,481 4,645 1,266 2,150 1,286 1,958 115 (51) 140,551 120,776 170,549 119,556 80,914 53,700 58,963 19,754 20,291 27,624 w (1) Individual returns and taxable fiduciary returns 1/ with net incomes Under 5 (estimated) 5 under 10 10 under 25 25 under 50 50 under 100 100 under 150 150 wider 500 300 under 500 500 under 1,000 1,000 and over Net gain Other inoome from sale of property other than capital assets 24/ 9/244,555 227,855 10/35, 986,499 6,014 199,404 709,393 40,664,368 Table 2-A. - Individual returns, 1940, with net incoae by net income classes, and with no net incomet Number of returns, sources of inccae and deductions, and net incoae (Returns filed in period January through June, 1941) (Net income classes and money figures in thousands of dollars) Net income classes (1) Returns with net income: Under 5 (estimated) 5 under 10 10 under 25 25 under 50 50 under 100 100 under 150 150 under 300 300 under 500 500 under 1,000 1,000 and over Total, individual returns with net income Returns with no net income 6/ Grand total Met income classes (1) Returns with net incomes Under 5 (estimated) 5 under 10 10 under 25 25 under 50 50 under 100 100 under 150 150 under 500 300 under 500 500 under 1,000 1,000 and over Total, individual returns with net incoae Returns with no net income 8/ Orand total Number of returns Salaries, wages, commissions, etc* (2) (4) Taxable interest PartnerBank Partially ship deposits, taxnotes, exempt mortgages, Governcorpora- ment obtion bonds ligations 14/ profit 15/ (5) 13,596,640 23,226,490 1,036,993 29/621,429 518,710 2,072,846 390,851 126,041 182,139 1,301,380 546,959 116,166 472,140 35,295 380,076 48,411 215,380 285,810 22,224 10,032 58,298 115,102 6,623 1,851 40,593 125,133 5,044 1,059 10,275 61,657 1,530 250 3,110 45,187 1,748 112 1,499 60,561 1,282 49 14,546,137 27,402,010 3,048,327 66,114 43,252 950,497 60,687 17,686 14,412,251 27,445,262 3,109,014 968,183 Partnership loss l§/ Business loss i7/ (18) (19) 10,876 4,464 4,270 1,915 1,259 460 1,192 186 Net longterm capital loss 18/25/ (20) (6) (30) 13,053 17,534 9,572 4,065 1,412 1,095 134 246 8 462,423 343,099 354,286 161,649 86,428 (7) 20,043 16,023 5,026 921 1,301 47,119 1,451,199 1,055 8,742 48,174 1,459,940 E* income Sources oJ Income Rents and Business Capital eain 18/ from royalties profit 17/ Net longShort-term 19/ fiduciterm capiaries 16/ Net short- Prior year Net shorttal gain term capi- net short- term capi22/ tal gain term capi- tal gain included tal 10S8 before deducted deducting in col. col. 12 22/ 21/ 17 20/ (col. 11 • 12) (col. 13 - 12) (8) (11) (10) (12) (15) (14) (9) 136,613 119,262 168,628 117,599 80,139 33,291 38,757 19,754 20,291 27,624 807,980 2,826,568 148,923 666,747 110,077 395,917 44,751 112,634 19,602 41,738 4,945 10,142 3,450 4,404 1,242 2,130 1,286 1,958 115 (31) 36,395 22,583 24,908 10,432 4,655 1,581 1,504 890 761,960 1,142,371 4,062,239 12,300 (a) (22) (23) 32 105,134 4,281 107,415 216,103 37,068 697,124 39,919,149 ia 4,000 282 4,282 4,048 4,563 111,697 220,150 Bad Losses Other from fire, debts 22/ deducstorm, tions 83/ etc. 27/ (25) (26) (27) Total deductions 28/ (28) Net incoae (29) 4 150,562 67,057 83,067 45,403 22,289 6,066 5,837 2,661 1,161 877 22,122 5,445 4,871 2,083 840 260 178 239 174 4 490,881 75,828 62,492 33,281 23,766 10,180 11,730 5,893 6,060 6,847 484,502 102,418 65,692 24,116 11,976 4,854 4,044 1,456 622 1,199 881,713 150,084 126,571 60,547 35,075 11,864 11,384 4,367 3,678 3,928 15,509 4,489 4,238 2,127 1,544 625 463 209 257 193 57,794 15,512 16,164 7,713 5,353 1,748 2,128 1,077 506 787 590,576 2,550,765 64,157 503,784 45,083 428,146 19,494 205,263 11,191 118,944 4,422 43,340 4,821 43,618 2,433 19,435 1,204 14,716 1,889 17,938 27,272,265 5,474,018 2,677,980 1,190,075 669,471 222,179 212,566 94,953 74,170 87,746 24,638 122,201 382,980 56,218 726,958 700,658 1,289,212 27,454 88,361 545,271 3,943,950 35,975,199 19,326 83,152 155,774 27,414 4,319 45,964 205,353 538,754 63,632 731,277 U 24,629 26,091 7,394 42,212 725,287 1,315,304 34,847 130,573 (17) 21,149 609,430 29,823,029 8,163 36,948 3,977,802 5,644 27,195 3,106,126 1,223 11,165 1,393,339 6,380 565 788,415 1,917 48 265,518 2,193 271 255,983 1,191 4 114,568 407 1 88,885 297 105,684 (51) 107,134 (24) (16) 57,559 29,287 37,431 23,687 21,430 12,115 17,50.6 10,554 15,580 12,964 13,027 Deductions Net loss Contribu- Interest Taxes from sale tions 25/ paid 26/ paid 26/ of property other than capital assets £4/ (15) 37,218 23,436 26,149 11,227 5,003 1,654 1,602 917 171 38 774,260 1,168,966 4,075,265 26,595 Net gain Other Total from sale income income of property other than capital assets 24/ 823 853 1,241 795 548 73 98 26 20 6 68,429 14,551 15,698 8,585 5,870 2,882 1,859 914 1,242 2,211 For footnotes, see pages 14 and 15. (3) Dividends from domestic and foreign corporations 13/ 55,648 445,960 §/244,555 598,919 4,387,910 10/35,730,644 2,000 6,014 199,404 39,068 705,138 40,118,554 14 Footnotes for Tables 1, 1-A, 2, and 2-A l/ For taxable fiduciary returns, the net income used for olassifioatlon and tabulation is the net income taxable to the fiduciary, 15/ Excludes dividends received through partnerships and fiduciaries *nd dividends received on share accounts in Federal savings and loan associations* Zj For 1940, the personal exemption allowed •ingle persons, married persons not living with husband or wife, and estates was reduoed from #1,000 to #800, and that for heads of families and married persons living with husband or wife for the entire taxable year was reduoed from |2,600 to #2,000* Similar to 1939, a trust is allowed, in lieu of the personal exemption, a credit of #100 against net inoome * 14/ Interest received on United States savings bonds and Treasury bonds, owned in excess of #5,000, and on obligations of instrumentalities of the United States other than those issued under the Federal Farm Loan Aot, or such act as amended* Z/ Returns with normal tax and surtax oonsist of (1) returns without net long-term capital gain or loss and (2) returns with net long-term capital gain or loss, whioh are stfcject to normal tax and surtax Instead of alternative tax* (See note 4*) 4k/ The alternative tax is imposed on returns with net long-term capital gain if such alternative tax is less than the sum of the normal tax and surtax computed on net income including net long-term capital gain. The alternative tax is imposed on returns with net long-term capital loss if such alternative tax is greater than the sum of the normal tax and surtax computed on net inoome after deducting net long-term oapital loss* 5/ Ten percent of the total income tax, but not in excess of ten percent of the amount by whioh the net income exceeds the inoome tax* 6/ An alternative tax is reported on 46 returns with no net inoome and with net long-term oapital loss* On these returns the tax, computed on net Inoome before the deduction of the net long-term oapital loss, exceeds SO percent of the net long-term oapital loss* 7/ Exemptions from normal tax and surtax exceed net income* A negligible number of nontaxable individual returns in net income olasses of #6,000 and over is not tabulated separately* B/ Inoludes individual returns with zero net inoome (total inoome equals total deductions ) * 9/ Deficit. 10/ Net inoome less deficit* 11/ Hot available. 12/ Average total tax not computed. 15/ Current year partnership profit or loss Inoludes dividends received, and excludes (1; taxable interest on obligations of the Ifciited States, and (2) net gain or loss from sale or exchange of oapital assets* The amounts of charitable contributions and net operating loss for the prior year are not allowable deductions in the computation of partnership profit or loss* The items of taxable interest on obligations of the tfaited States, net gain or loss from sale or exchange of capital assets, and charitable contributions are reported on the return filed by each partner under their appropriate classifications, and the net operating loss for the prior year is reported in "Other deductions*19 16/ Inoome from fiduciaries inoludes (l) dividends received and (2) net gain or loss from sale or exohax^e of oapital assets, and excludes (l) taxable interest on obligations of the IJhited States and (2) net gain or loss from sale or exchange of capital assets received from * Common trust funds*" Each item which Is excluded from inoome from fiduciaries is reported under its appropriate classification* The net operating loss for the prior year from partnerships and businesses, which is allowed estates and trusts (but not "Com&on trust funds19), has been deducted from inoome from fiduciaries* 17/ Current year business profit or loss* The net operating loss for the prior year is reported in M0ther deductions.* 18/ The term "Capital assets" means property held by the taxpayer (whether or not oonnected with his trade or business), but exoludes (l) stock in trade or other property which would properly be included in inventory if on hand at the olose of the taxable year, (2) property held primarily for sale to oustomers in the ordinary oourse of trade or business, and (5) property used in trade or business of a oharaoter whioh is subjeot to the allowanoe for depredation* The tabulated amounts of "Net short-term oapital gain," "Net long-term capital gain" and "Net - 15 Footnotes for Tables 1, 1-A, 2, and 2-A - Continued long-term capital loss" include each participant's share of net capital gain or loss to be taken into aeeount from partnerships and "Common trust funds*" 19/ "Short-term* applies to capital assets held 18 months or less* 23/ "Long-term"applies to oapital assets held over 18 months* "Vet long-term oapital gain* and "Net long-term oapital loss" include losses from worthless stooks and bonds* 24/ Consists of net gain or loss from property used in trade or business of a character which is subject to the allowanoe for depreciation, whioh is excluded from oapital assets* 25/ Inoludes each partner's share of charitable contributions of partnerships (see note 15). 20/ Reported for the computation of net income* (For individuals, item 10(a), page 1, Form 1040) for income from estates and trusts, item 7(a), page 1, Form 1041*) 21/ Consists of the amount of prior year net short-term capital loss (not in excess of the net income for the prior year) deducted from the current year net shortterm capital gain* The amount tabulated appears on returns with and without net short-term capital gain reported for the computation of net income (item 10(a), page 1, Form 1040 and item 7(a), page 1, Form 1041)* For returns with net shortterm oapital gain reported for the computation of net income, the tabulated amount of prior year net short-term capital loss is equal to the entire amount of such prior year loss reported on the income tax returns (see column 2 of summary of schedule F, Form 1040 and oolumn 2 of summary of schedule E, Form 1041)* For returns without net shortterm oapital gain reported for the computation of net income, the tabulated amount of prior year net short-term capital loss is less than the entire amount of such prior year loss reported on the inoome tax returns, because there is deductible only that portion of the reported prior year loss which is equal to the current year net short-term oapital gain* 22/ Consists of current year net short-term capital gain before deduction of prior year net short-term oapital loss* This amount would have been reported for computation of net income if the prior year net short-term capital loss had not been deducted* 26/ Excludes amounts reported on return in schedule C and schedule for business deductions* 27/ Excludes amounts reported on return in schedule for business deduotions* Losses from fire, storm, shipwreck, or other casualty, or from theft, are those not compensated for by insurance or otherwise. 28/ Includes (1) each partner's share of net operating loss for the prior year from partnerships and "Comaon trust funds" and (2) net operating loss for prior year from business (sole proprietorship)* In Table 2, inoludes losses from fire, storm, etc*, and bad debts reported on taxable fiduciary returns with net income, Form 1041* 29/ Includes interest received on partially taxexempt Government obligations. 30/ Tabulated with "Taxable interest received on bank deposits, notes, mortgages, corporation bonds*" 31/ Less than |500.
@FedFRASER