The talking machine world (July-Dec 1920)

58 THE TALKING MACHINE WORLD September IS, 1920 STOCK DIVIDEND PROFITS TAXABLE Internal Revenue Commissioner Issues Ruling Stating That Tax Applies Where Sales Take Place — Decision of Interest to Business Men Washington, D. C, August 31. — Acting Commissioner of Internal Revenue Paul F. Myers has handed down a ruling in the matter of stock dividends that will prove of decided interest to the financial world. It comes in sequence to the recent decision of the United States Supreme Court in the case of Eisner vs. MacComber by which it was held that stock dividends were not taxable as income. The Government by the new ruling adheres to its view that somewhere in the status of such distribution of profits, whether in the form of stock dividends or some other form in the matter of bookkeeping, the tax attaches. To meet the precise application of the decision of the Supreme Court it is now held that the profit derived by the stockholder from the sale of stock dividends is taxable income to him. In order to clarify the attitude of the Government in the situation that arises from the decision Do You Throw Money Away? It is not a popular pastime — but still it is unconsciously done by many who just don't know that Repair Parts can be bought for less RENE MADE SPRINGS AND PARTS LAST LONGER COST LESS RENE MFG. CO. Montvale, N. J. the income tax regulations have been amended, these actions affecting the tax in question being as follows: "Article 1547, sale of stock received in dividend; stock received as a dividend does not constitute taxable income to the stockholder, but any profit derived by the stockholder from the sale of such stock is taxable income to him. For the purpose of ascertaining the gain or loss 3d) 4V The Bell-Hood Surrounding the Needle Clarifies the Tone of Objectionable Surface and Mechanical Noise A scientifically perfect needle designed after long experiment to better the tone quality of needles SEMI PERMANENT POINT LOUD MEDIUM SOFT A profitable needle for dealers to sell. More than 2000 Dealers are now selling them with splendid success. Order from the nearest branch. The BELL HOOD NEEDLE CO. 183 Church St., New Haven, Conn. 807 The Arcade, Cleveland N. E M. 1. T. CO., 89 10th St.. South 3442 N. Clark St. 127 E. 23rd St. Minneapoli. Chicago, III. New York City Dittributori for all state* west of Mississippi River and Wisconsin. derived from the sale of such stock, or from the sale of the stock with respect to which it is issued, the cost (used to include also, where required, the fair market value as of March 1. 1913), of both the old and new shares is to be determined in accordance with the following rules : "l. Where the stock issued as a dividend is all of substantially the same character or preference as the stock upon which the stock divident is paid, the cost of each share of both the old and new stock will be the quotient of the cost or fair market value as of March 1, 1913 it" acquired prior to that date, of the old shares' of stock divided by the total number ot the old and new shares. "2. Where the stock issued as a dividend is m ,whole or in part of a character or preference materially different from the stock upon which the stock dividend is paid, the cost or fair market value as of March 1, 1913, if acquired prior to that date, of the old shares of stock shall be divided between such old stock and new stock or classes of new stock, in proportion as nearly as may be to the respective values of each class of stock, old and new, at the time new shares of stock are issued, and the cost of each share of stock will be the quotient of the cost of the class to which such share belongs divided by the number of shares in that class. "3. Where the stock with respect to which a stock dividend issued was purchased at different times and at different prices and the identity of the lots cannot be determined, any sale of the original stock will be charged to the earliest purchases of such stock (See Art. 39) and any sale of dividend stock issued with respect to such stock will be presumed to have been made from the stock issued with respect to the earliest purchased stock to the amount of the dividend chargeable to such stock." THE INDUSTRY OF THE NATION The home builder is the mainstay of the i:ation. and industries are now giving preference to the men who either have or manifest a desire to build their own homes. It's just as desirable to know when to forego an advantage as it is to know when to grasp an opportu nity. ROHEN STONE We are the only miners and manufacturers in this country of Rotten Stone for use in Phonograph Record making. Our product is now in use by practically every record manufacturer in this country. We are also headquarters for all other minerals for record making and everything we handle is made especially for this purpose and absolutely guaranteed. Expert advice given upon any formula. KEYSTONE MINERALS CO. 41 Union^Square, N«w York City