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About Herald and news. (Klamath Falls, Or.) 1942-current | View Entire Issue (Aug. 13, 1954)
FRIDAY, AUGUST 13. IfliU HERALD AND NEWS. KLAMATH FALLS. OREGON PAGE THIRTEEN Taxes On Annuities, Life Insurance Cut By New Law . - ' onnnLil WASHINGTON U-i More than a million taxpayers will get a tax cut under new rules for taxing income from annuities or life in. surance included in the giant tax revision act Just passed by Con gress. The new rules apply to income received after last Dec. 31. In annuities, you generally pay so much a year to an Insurance company. Then at a fixed age or year, you get back so much a year for the rest of your life, or Solon Lauds Ike Defense Program WASHINGTON" Wi Sen. Fergu son (R-Mich said today President Eisenhower has taken an intense, personal interest in seeing that the nation's defense program is the best that can be devised arid "our people need have no fear." Ferguson, chairman of the Sen ate Republican Policy Committee, said in a speech prepared for the Senate that the Eisenhower ad ministration has replaced a Democratic policy of "commit ments everywhere and strength nowhere" with "a comprehensive military program at a price the national economy can afford.", The Michigan senator said .this program was aimed toward keep ing world peace, and built around a flexible, mobile military force which is capable of being sup ported by men, weapons and sup plies in many far-flung areas throughout the world." Ferguson's 0,000-word explana tion of the administration's mili tary aims presumably was intend ed as a reply to criticism by many Democrats that the "mas sive retaliation" policy enunciated by Secretary of State Dulles leaves much to be desired In total defense. Ferguson said that "massive re taliation" the ability to strike back quickly with atomic and hy drogen bombs against any aggres sorwas only one element of a rounded program. He said "brush fire" wars set by the Communists would be dealt with by using "conventional as well as atomic weapons." "In putting out brush fires, we hope to rely as much as possible on indigenous military strength," he said. "To that end we offer military training, military defense support, economic support and logistic support." As for "massive retaliation," Ferguson said that "although we cannot guarantee that this deter rent principle will be foolproof in the future, certainly it has worked to prevent a major war thus far." Ferguson said he hopes Sir "Win ston Churchill was right in saying that both sides may avoid a war which begins with what both dread most atomic bombing. The Michigan senator said mili tary officials decided that "we could get maximum defense at minimum cost over a long period of time by emphasizing the role of sir power." But he said this did not mean the army and navy would be neglected. Mt. Loki Enjoying the evening were Mr. and Mrs. Gray Brannon, Mr. and Mrs. Wallace Thompson, Mr, and Mrs. Howard Jackson, Mr. and Mrs. Bud White, Mr. and Mrs. El don Kaylor, and the guests of honor. Exhibits will be received until 10:30 a.m. The public is invited from 1:30 to 5 p.m. There will be a silver tea from 2:30 to S. Anyone may enter their exhibits and see the displays. Mrs. Charley DeLap Jr., Pamela and Lois accompanied Mrs. De Lap's parents, Mr. and Mrs.' E. P. Blankenship, to Wenatchee, Wash ington, recently where they visited friends and relatives for 10 days. Roger and Charley Thompson flew to Portland to visit their aunt and uncle the Ed Ryans recently. Mrs. Ryan and children, Ann and Scott, came to visit Mrs. Ryan's parents Mr. and Mrs. Scott Thomp son. Mr. and Mrs. Percy Dixon drove to Portland recently, parked their car at the airport and took the plane to Fairbanks, Alaska, where they spent five wonderful days with Donna who had been in Fairbanks a month as a scout councilor. They all flew back to Portland and on home by car. Percy said the peo ple in Alaska were so congenial and generous, they really go out of their way to be nice to you. Mrs. Jay Fairclo traveled to Southern Kansas recently where she visited her brother and sister, Ruth Patton. The three of them took a trip to see the Black Hills and also saw the statues of the four presidents carved out of the rock at Rushmore, South Dakota. They went to Abilene whera they grew up. Ruth went to high school at Abilene with Ike Eisenhower. She returned here with Grace to visit the family. They came home by Idaho and Mrs. Bill Brlsdon and two young sons drove them here, where Mrs. Brisdon visited a few days with her parents, the Fairclos', and other relatives. tn,oy heaim, mt, comfort and hosorfolrtv omidit pleaiont surroundings. Cemotetely Furnished Sloping ond Housekeeping Cabins, with oil modem loc'Mtes. HOT MINERAL end MUD BATHI For Rheumetism, Arthritis, Neuritis, Sttetfce, Nervousness CARBON DIOXIDE VAPOR IATHI Are eseellefit see Itieree, New, ee lrsrB tions, Hieti end Lev Bleed rmsers "Your Heotm Is Our Business ' e.r Reiervetlent eed taferswetien Ae'tfreM Seckherrt Minerol Serins, Rf. 1. Asfcleee", Oregon er Phone Len, Ditteee. Or, H'rrMn wen.r. Director Chiropractic pnyticion for a fixed number of years. The big question, taxwise, is how much of the money paid to you is' simply a return of the money you paid in and how much is interest or profit and therefore "taxable. Under the old law, you first figured the total amount you paid in the total cost of the policy to you. Then you were taxed each year on 3 per cent of that cost. The remaining annuity income was tax-free. For example, say a policy cost you $10,900 and at age 65 you were to get back $1,200 each year for the rest of your life. Under the old law, 3 per cent of 10,900, or 327. would be considered taxable in come each year. The other $873 a year would not be counted as in come for tax purposes. This would continue until the $873 of tax-free income a year added up to the cost of the policy, or $10,900. From then on in this example from the 14th year on you would be taxed on the full $1,200 a year. This sudden increase in taxes was considered a hardship in many cases, 1 Under the new law, you first figure your total cost just as be fore. .Then you figure your re maining years of life expectancy, or the fixed number of years, over which you are to receive repay ments. Then you divide your cost by this number of years. That is the amount of income you can re ceive tax-free, and the rest is tax able. EXPECTANCY In the example above, say you had a life expectancy of 10 years, or a fixed 10 years in which the policy says you are to receive $1,200 a year. Your total cost of $10,900, divided by 10, amounts to $1,090 and that amount of annual income is considered tax free. You would pay taxes on the remain ing $110 each year. These amounts would remain the same throughout even after you had recovered the full cost of your policy, and even if you actually lived longer than your life expec tancy. Thus, under the old law, you would pay taxes on $327 a year for a while and then you would pay taxes on $1,200 a year. Under the new law you would pay taxes on only $110 a year throughout. The new rules are different in cases where an employer contrib utes much of the cost of an annu ity or pension policy to an em ploye. If the employe receives back all of his cost within the first three years of payments to him, he doesn't pay any tax during those) first three years. Then after three years, he pays income taxes on the full amount he receives. ESTIMATE Experts estimate this would ap ply In 5 per. cent of the cases where employers contribute to pen sion or annuity contracts. So the new life expectancy rules will chiefly benefit those who buy com mercial annuity policies on their own. There's one helpful provision in the new act. You don't have to go through complex arithmetic to fig. ure how much of your- annuity is taxable. The insurance company, when it starts payments to you, will compute your life expectancy and tell you how much of your annuity income will be taxable. Another provision gives a big cut in testate taxes. Under the old law, if you paid premiums on a life insurance policy, proceeds of the policy were considered part of your estate when you died. Your survivors paid an estate tax on them. But from now on if you make the policy irrevocably pay able to your beneficiary, it is not included as part of your taxable estate. This provision alone is ex pected to reduce taxes about 25 million dollars for about 10,0()0 tax payers each year. But another change will Increase taxes for some. Under the old law, the beneficiary of a life insurance policy could leave the principal with the insurance company and receive tax-free interest in annual installments. Under the. new Jaw, this interest will be taxable for anyone but a widow. And a widow will pay taxes on any such in terest which exceeds $1,000 a year. State Bounty Payments Told SALEM !P Thirty-two counties will collect $30,000 from the -state for payment of bounties on preda tory animals for the year ended June 30, the State Department of Agriculture said Thursday. The bounties are for killing 9.931 animals, including 3.537 coyotes, 1,709 bobcats, 330 foxes, 117 bears, and 20 mountain lions. Douglas County gets the biggest share, $3,330. Amounts nairl tn nthnr rniinlioo Include: Baker $800. Behton $800. Clacka mas $800, Gilliam $800, Grant $570, Hamev Sl.OrXI .Iflrkcnn toon .1neB- phine 660, Klamath $1,540,' Lake ji.jju. Lane 11.460, Lincoln $320 Linn $800. MalhPlir 11 1l)n Vlnrrnuf $850, Sherman $850, Umatilla 1.- uw, union $800, Wallowa $800 Wheeler $530. DISEASE NEW DELHI, India im A mystery disease spreading over northern India has caused the deaths of about 100 children, med ical sources said Thursday, EAGLES PICNIC Will Be Held At DENTON PARK (Gravel Pit) Fort Klamath SUNDAY, AUGUST 15 Brinq Your Own Picnic Lunch and Silverware Watermelon, Coffee, Sugar, Cream, Pop, Ice Cream Will Be Furnished r-er m ft, y Wi fi J. ' ' - t. - K L : J . EIGHT is your lucky number at Griggs Superior Foods this weekend as T. C. Griggs, left, and Carl Woods observe the eighth anniversary of the establishment of the big market at South Sixth and Shasta Way. . Pro-British Iraqi Leader Plans Anti-Red Offensive BEIRUT, Lebanon, Wl ' The return to power of a veteran Iraqi warrior who once hanged Com munists in the streets may herald a Siew British agreement in the Middle East a revision of the British-Iraqi treaty. Iraq's new premier, 66-year-old Nurl Said, recently returned to Baghdad after a lengthy stay in London. He formed a tough-fisted cabinet, dissolved parliament, and announced two major objectives crushing of subversive activity and revision of the treaty with Britain. Following closely British settle ment of knotty problems in Egypt and Iran, agreement with Iraq may be another major step in London's drive to, set her Mid East house in order. . , If a fresh British-Iraqi agree ment is in the offing, Nuri Said is considered the man to push it through. He has long been a friend of Britain and has kept his country in the Western camp. The unques tioned strong man of Iraq, his cur rent cabinet is the 12th he has headed since 1930. He usually takes power in times of crisis. Nurl never has been the popular type of leader. Nationalists have bitterly criticized his pro-British leanings. Intellectuals consid er him reactionary and undemo cratic. Three times he has- been chased out of the country. But always he has come back with rare exceptions he has been boss of Iraq since 1930. Part of Nuri's preparation for a settlement with Britain will be a drive against internal commu nism. Leftists and fellow travelers gained their first parliamentary foothold in Iraq in the June 9 elec tions this year. While Nuri was ill in a London hospital, seven left wingers of the National Front coalition were elected to parlia ment on a platform assailing American military aid and adher ence to the Turkish-Pakistani pact. If Nuri reaches a new agreement with Britain, this small bloc could use the floor at parliament to launch a popular campaign against it. This is one ot the chief reasons Nuri dissolved the chamber on his return, even though it had had only one meeting. New elections probably will be held in September. Between now and then, Nuri is expected to use every form of pressure at his com mand to crush leftist activity and to guarantee a parliament which will back any new agreement strongly. If this is Nuri's objective, it means bad news for leftists. Iraq's Communists still shudder at. the it leaves you breathless mirnpjf '., name VODKA 60 proof Midf from ! 005 (rain neutral lpintb St. Pierrt SmrrnofT Fli. Inc., Hanford.Conn. 111 l3"! I So smooth l25UtI iv . 1 HUM memory of 1949, when Nuri hanged five reds In the streets of Baghdad and left their bodies swinging for half a day. Keep Oregon Green banquet ploct cords, cigar ette snuffers, key chains, metal car bumper tags and display posters. Just telephone any of these members of the Klamath County Keep Oregon Green Committee: Hal Ogle, Klamath Forest-Protective Association, 3282; Bob Cooper, U.S. Dis trict Forest Ronger, 3801; or Joe LaCloir, 7292. Use them -help keep Oregon green! JCIIEVENT FiUlESX FIHES- Ike May Take WASHINGTON Wl President, Elsenhower appears to be inching into a leading role 1)1 the battle for control of Congress despite his avowed plans to remain aloof from local political skirmishes. Administration leaders said to day Eisenhower hopes to go on television and radio with a 30-min-ute talk on the administration's legislative record within 24 hours after Congress ends its regular work, probably next week. Eisenhower told his news con ference yesterday he was plannuig what he called a little bit of a talk to review Congress' record since he took office in January 1953. He added he didn't want to cheat on himself by saying any more at this tune. , But administration officials who asked anonimity said preparations for the appearance have been under way for a long. time. NATIONAL REPORT Although the President's talk will be billed as a report to the nation. Democrats indicated they may demand equal time to count er what some of them said they regard as a Republican kickoff for the congressional campaign. Despite Eisenhower's repeated statements that he would avoid getting involved in local' political NOW f " : burned today- jjooa cahsthuiA .... Leading Role fights, his schedule already In cludes appearances in Illinois, New Jersey and Kentucky. Pres sure is reported beginning to build up heavily from' other areas. The President has also taken time to pose for pictures with more than 100 GOP House members. GOP National Committee offi cials have turned to Vice Presi dent Nixon to carry the heavy bur den of a political stumping tour. N.ixon starts his active campaign ing with a speech at the Ohio State Fair Sept. 15 and is expected to make several excursions to dif ferent parts of the country before the November voting. GOP KECOKD Mnny Republicans say, however, that there eis no voice equal to Eisenhower's in defending the re cord of the OOP-coutrolled Con gress. Eisenhower has insisted that the Republicans must stand or fall on the record made, on the admin istration's program. As expected, there Is a sharp division of political opinion on that. Sen. Carlson (R-Kan) said he thinks the Eisenhower administra tion "can be proud of the record it has made in reducing taxes and expenditures and in handling for eign affairs," and he added: "I'm going out in the campaign and IN KLAMATH FALLS! "The World Famous" lOc HAMBURGER ' A Delicious Mealtime Treat NEAL'S Fountain 1229 Main St. r orcst fires are a tragedy. When the woods burn, little trees die. These are the trees upon which we de pend for our future supplies of paper, lumber and other products so necessary to comfort, welfare and security. Because nearly all forest fires are man caused and preventable, this waste can be stopped. Do your part . . . Keep Oregon Green. This message is mada possible by tha Advertising Council and tht Klamath County Keep Oregon Green Committee, end is brought to you as a public servict by Weyerhaeuser Timber Company In GOP Fight talk about it." Sen. Symington (D-Mo) said he doesn't believe the farmers are satisfied with the administration's program in that field and will show it with their votes. However, Sen. Aiken (R-Vt), who piloted the President's flexible price support program through the Senate, said he believes farm prices are going to strengthen. FARM VOTE "If the farmers believe they are In good shape in November, they'll vote Republican," he declared. Sen. Monroney (D-Okla)- said it is his opinion that Eisenhower will have difticulty in finding anything "to brag about" in the Republican record of the Congress coming to a close. "As of now, the administration's batting average is extremely low," he declared. "Eisenhower's big vic tory and he is welcome to claim it Is in reducing farm prices on the five basic crops which have BALSIGER Main at Esplanade For Congress cost the least In government nun. ports in the last 20 years." ORDER BUENOS AIRES OB Presl. dent Peron's government, which has been distributing newsprint for more than two years an nounced Thursday it will let pa pers buy their future stocks direct from the manufacturers. AND SIDING $$$ SAVE $$$ Dtal with fti man wh does the work W. S. "BILL HEIMANN Phone ISM lis Hilchen Gel away for fun and re laxation thruout the yearl The 15' is the most pop ular travel trailer and more people buy the Shasta than any oiner make. j FeaffceiweigtoJ HSOpoundj.l Sleeps 5. Hoi every mod. em feature.' MOTOR CO. Ph. 3121 lm L J . i W. t.ieHJlli (fceirae-fcrirMrM'tMsMi I
