Treasury Department Letter'Shows
Non-Gov’t Workers Cannot Avoid
Living Cost Tax Under Present Law
From the U.S. Treasurey Dept., '
under the signature of H. T.
Swarz, director of the Tax Rulings
Division, to Delegate Bartlett. We
quote:
“Commissioner Andrews has
asked me to reply to your letter of
November 3, 1953, with which
you enclosed copies of three let
ters from constituents. You state
that you have received numerous
communications from constitu
ents, not federal employees, who
believe that Revenue Ruling 237
(I.R.B. No. 22 (1953) p.l3> has set
a precedent so that the cost-of
living allowances paid to them
should be exempt from federal in
come taxes.
“You are concernel with:
“(1) Whether Revenue Ruling 237
sets a precedent whereby we may
now rule on the payment of fed
eral income tax by other than
those affected by the ruling in the
matter of allowances paid to meet
the additional cost-of-living in Al
aska and the other territories and
possessions;
“(2) If such is not the case, what
would the procedure be to ha\)e us
rule on such cases; and
“(3> In connection with such rule
would it be necessary that a case
be brought to court for a deter
mination.
“Revenue Ruling 237 does not j
set a precedent. That ruling is ap- !
plicable only to the cost-of-living i
allowances paid pursuant to sec
tion 207 of the Independent Offi
ces Appropriation Act, as amen
ded, P.L. 491 and. P.L. 862, 80th
Congress, and Executive Order
10,000 dated September 16, 1948,
132, F.R. 5452. These allowances
are paid to civilian employees of
the United States Government
stationed in the territories and
possessions of the United States in
accordance with regulations ap
proved by the President. Such
regulations have been issued un
der Executive Order 10,000.
“Section 116tj) of the Internal
Revenue Code excludes from
gross income, to be used in com
puting net taxable income, in the
case of certain civilian officers or
employees of the Government of
the United States stationed out
Duke of Edinburgh Takes
Over Regency Rights
Of Princess Margaret
LONDON, W — The Duke of
Edinburgh took over the regency
rights of Princess Margaret Fri
day as amendments to the 1937
regency acts won final approval.
Queen Elizabeth II assented to
the new legislation Thursday
night shortly after its final pas
sage by the House of Lords. The
House of Commons had unani
mously approved the bill 10 days
ago.
Now, if the queen dies or be
comes incapacitated before her
5-year-old son Prince Charles is
18, her husband would become
regent ahead of her sister.
In the succession to the throne,
however, Princess Margaret still
stands third in line, after Charles
and his baby sister Princess Anne.
Australia is preparing a perma
nent, manned scientific station on
the Antarctic Continent.
time, the taxpayer may file a
petition with the Tax Court of the
United States for a re-determina
tion of his tax liability.”
1
Tempermental Tenor
Walks Off Stage, Leaves
Carmen to Stab Herself
CHICAGO, (/P)—Don Jose walk
ed off stage leaving Carmen un
stabbed in the New York City
Opera Company’s performance
Thursday night and telling the
conductor, “Finish the opera
yourself.”
The walkout by tenor David
Poleri, who was singing the lead
ing role, means Poleri “has elim
inated himself from the commun
ity of our company,” conductor
Joseph Rosenstock later told a re
porter.
Gloria Lane, singing the title
role of Bizet’s tragedy, carried on
alone on the stage in final death
scene and collapsed per script,
but without benefit of a dagger.
Until the incident, critics said,
Poleri and Miss Lane had been
singing well. Both have been
praised for their performance
here.
Rosenstock blamed the incident
on Poleri’s “nervous tension” re
sulting from friction with other
singers during the second act.
! Charles A. Gaby Dies
PORT ANGELES, UP—Charles
A. Gaby, who went to Alaska 55
years ago and followed the gold
trail across the territory, died here
last night after a heart attack. He
was 77.
He lived in Alaska until 25
years ago and was known from
Ketchikan to Nome. He had oper
ated a restaurant at Juneau and
had worked at many trades in
Ketchikan and Cordova.
ONLY A GOAT
ZANESVILLE, Ohio, UP) — For
about a month residents of the
Zanesville area near North River
have reported a wild animal run
ning loose.
Some described it as a mountain
lion; some as a cougar; some as
a rabid fox and others as a bear
cub.
The beast came out of the
woods, charged into a parked car
and was coralled by sheriff’s de
puties Thursday.
The deputies didn’t have to call
in a wild animal expert. They
knew a hornless billy goat when
they saw—and smelled—it.
>
side continental United States,
amounts received as edst-of-living
allowances in accordance with
regulations approved by the Pres
ident. Regulations governing the
allowances made the subject of
Revenue Ruling 237 have been
issued under Executive Order 10,
000, by the Civil Service Commis
sion. It must be concluded that
such cost-of-living allowances
come within the exclusion pro
vided in section 116(j) of the Code
and are not subject to federal in
come taxes. This ruling would not
be applicable to cost-of-living al
lowance? paid employees other
than Federal Government em
ployees, to meet the additional
cost-of-living in Alaska and the
other territories and possessions.
“Rulings involving cost-of-living
allowances, other than the ones
covered by Revenue Ruling 237,
would be based upon the facts
present in each case. However, we
know of no provision of the In
ternal Revenue Code other than
the provisions of section 116(j)
which would exclude cost-of-liv
ing allowances from taxable in
come. It would appear that we
would have to rule adversely on
all cases submitted to us which
did not come within Code section
116 (j).
“When a taxpayer receives an
adverse ruling he may include
the income upon which he has
received such a ruling, in his Fed
eral income tax return filed for
his taxable year, pay the tax
assessed thereon and file a claim
for the refund of any tax he feels
has been overpaid. This claim
should be filed within 2 years
from the date of the payment of
the tax or 3 years from the time
the return was filed whichever
period expires the later. Upon the
disallowance of the claim the
taxpayer may bring suit for the
►recovery of the amount he claims
to have been overpaid.
“In cases where the income has
been omitted from the return, we
would issue a final notice of de
ficiency for the additional tax
that would be due plus interest
thereon. Within the designated
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2:00—News 7:30—Mr. and Mrs. North 4:45—SPECIAL SHOW
2:15—And for Tomorrow 7:55—One for the Book 5:00—Father Knows Best
I
i _
Wven-Reody Turkey and all the Fixin's for Your
\| Thanksgiving Feast . . . It's none too eariy to shop for holiday
8 pastries, beverages, candies and nuts, fruits and vegetables—foods
sure to delight the whole family ond make this the
best Thank ving ever.
CARNATION MILK
6 for $1.35
$10.50 a Case
NEW ITEMS!
SPANISH RICE DINNER
ROQUEFORT SALAD DRESSING
GIRARD'S FRENCH DRESSING
AMAZO INSTANT DESSERT
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TURKEYS I
BELTSVILLE—5 to 8 lbs. -yjj j ij
TOMS & HENS—10 to 25 lbs. 1.00 I
LONG ISLAND DUCKLINGS j jq l
NICE PLUMP GEESE j JQ f
ROASTING CHICKENS ^ JQ L
I
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