Income Tax
Thi U the seventh of eight ar
ticles In the Newspaper Enterprise
Assn. Income Tax Primer, for
readers who want more informa
tion than is supplied in the offi
cial instructions.
By RICHARD A. MULLENS
and
ClftRI.ES W. SCIIOESEMAN
Written for
Newspaper Enterprise Assn.
Do you have the idea that all
money you received last year is
reportable as income on your lax
return due before April 15. 13?
Do you believe that because
you did not receive cash but only
property (or a promise to payi.
THE LIGHTER SIDE
eadiustment Problem
Hits One-Time Smokers
WASHINGTON (UPI) Anyone
who quits smoking must go
through a readjustment period
that is likely to present certain
difficulties.
With me. these took the form of
dart throwing and an abortive at
tempt to grow a beard.
But by and large I have had
it easy compared to the experi
ence of a young lady in Pensa-
cola. Fla., with whom I have.
been in correspondence.
I would mention her name ex
cept that she is in the broadcast
ing business and therefore is pre
sumably adverse to publicity. So
I'll just call her Miss Wireless
Miss Wireless writes that until
a few months ago she not only
was a confirmed cigarette smoker
but also had a habit of chewing
her fingernails.
Dangerous Combination
This is a dangerous combina
tion, owing to the fact that a smo
ker who sticks a finger in his or.
her mouth is apt to put a match
to it by mistake.
Recognizing that she was a po
tential fire hazard, Miss Wireless
resolved to kick the nicotine habit,
which led to rather unexpected
results.
"When I quit smoking," Miss
Wireless reports. "I became be
fuddled, confused, dim-witted. At
first, it was difficult to remember
what I had stopped. So, by acci
dent, I stopped biting my nails
at the same time."
One might think that congratu-l
lations were in order for ridding
herself of two bad habits, but
Miss Wireless views it as a mixed
blessing.
Require Attention
"I now have long unshapely
claws that constantly require at-
tenlion. I rip my hose, I hit the
wrong letters on the typewriter
and 1 go around tapping on ta
bles all day.
"I never had any trouble pick
ing up pins when 1 had no nails.
Now I'm having to be rehabili
tated and learn how to use the
instruments.
Dope Charge
Trips Eight
PORTLAND (I'PP-Eight Port
land men were arrested by fed
eral and city authorities Tuesday
night and early today in the big
gest narcotics crackdown here in
two years.
Six were picked up on secret
indictments returned by a federal
grand ju and two were arrested
on state charges.
No narcotics were seized, al
though several apartments and
homes were searched.
John Windham, chief of the
Federal Bureau of Narcotics here,
mid the charges involved illegal
talc of narcotics.
It was the highest narcotics
raid here since December of 10
when 12 arrests were made.
Held on federal charcrs were:
I". P. Fatten-on. 33: Otis Spell
man. 36; Richard K. Mayfield. 2.1;
Franklin Brothers. 33; Loun
Talps. 30. and Wilbcrt Alvin John
ton. 32. Arrested on state charges
were Jim Babe Wilson. 21. and
Johnnie Lee Jacks-on. 19
In addition to the Portland ar
rests, three men were arrested on
federal warrants in Seattle.
PeopU Rtod
SPOT ADS
Primer (7)
you do not have any income to
report?
You may be wrong on both
counts.
it you received lite insurance
lor accident or health policy pro.
cceds last year paid because of
the death of the insured per
son, this amount would generally
not be taxable income.
Suppose, furthermore, the cm
plover of your deceased husband
paid you. as his widow, a sum of
say7.0UO, is that taxable? Gener
ally, $5,000 of the amount is not
taxable if the employer has paid
no oilier amount to anyone else
If the employer paid, for ox-
ample, another $3,000 to your
Damage to your ear can result in
a casualty loss deduction.'
'I wake up scratched and bleed
ing every morning, and 1 ve de
velopcd the dreadful habit of
blowing on my nails and shining
them on my collar.
Miss Wireless certainly has a
problem there and. as a fellow
ex-smoker, 1 would like to help
if I can. My suggestion is that
since she doesn't use cigarettes
any more she should bite the fil
ters off and impale them on the
ends of her nails.
This would make her the only
girl in Pcnsacola with filtered
fingertips.
Ways, Means
Pests Given
SALEM (UPD - Sen. Ward
Cook, D"-Portland, and Rep. Ross
Morgan. D-Gresham. co-chairmenj
of tiie Ways and Means Commit
tee that will deal with state budg
eting, today announced the follow
ing subcommittees:
General Government Sen. E. D.
Potts, D-Grants Pass, chairman;
Reo. Sidney Leiken. D-Roseburg;
Sen. Daniel Thiel. D-Astoria; Rep.
John Mosser, R-Portland; Sen.
Walter Leth, R-Salcm.
Public Safety, Commerce and
Labor, Transportation Rep Beu
lah Hand. D-Milwaukie, chairman:
Sen. L. W. Neubry, R-Ashland;
Leiken: Sen. Alfred Corbett, D-
Porlland; Sen. Dwight Hopkins,
D-Imblcr.
Natural Resources Rep. Staf
ford Hansell. R-Hermiston, chair
man: Leth, Rep. Don McKinnis,
D - Summerville; Hopkins; Rep.
George Flitcraft, R Klamath
Falls.
Education Thiel, Chairman
Hansell. Corbett, McKinnis, Hop
kins. Mosser.
Public Health, Social Services
Corbett. C h i a r m a n; Flitcraft
Nowbry, Hansell, Hand.
Parable Told
By Khrushchev
BERLIN a'PP-Premier Nikita
Khrushchev (old the East German
Communist party congress today
about a Soviet general in World
War II who made an error and
khot himself.,
"I was on the southern front at
the time." Khrushchev said. "I
told him he had to shoot himself.
I though he would sutler only a
psychological shock and would get
over it. But, in fact, the man did
thoot himself in front of my eyes.
It was a fine death, but one
can always die in a fine manner.
'What did he achieve? He shot
himself and only lett a lot of
stink behind. But we want to
live."
Khrushchev used the anecdote
to illustrate the correctness of
his policy of coexistence with the
West, rather than the inevitabili
ty of war as advocated by Red
China.
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the
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- Income
children because of your hus
band's death, the $5,000 exclusion
must be apportioned among the
total $10.000 $3,500 to you and
SI.500 among your children. This
$5,000 employe death benefit ex
clusion is a specific legal allow
ance. strictly controlled and limit
ed by law.
Now. there are two additional
rules which might change the
result of the example. One in
your favor; one not so favorable
Gifts are not taxed and there
is no limit on them. Therefore,
if the amount the employer pays
you. as the employe s widow (and-
or your children, rccardless of
amount', is a gift (within the
meaning of the law, then courts
have said, whole amount is tax-
tree.
However, it uic employer was
only paying you certain amounts
such as your husband's unused
annual leave or his earned bonus
payable to him during his life, the
exclusion would not apply. Nor
does the exclusion apply to any
other amount to which he would
have been entitled had he lived
or to which he could not have
forfeited his rights.
There are however, many com
plicated additional rules which
will permit the $5,000 exclusion if.
your husband was a party to any
number of plans, trusts, or con
tracts which his employer might
have established. Investigation is
wise.
Ordinarily, amounts paid un
der a joint and survivor's annuity
under which the employe was
the primary annuitant are not ex
cludable under the above $5,000
exclusion, if the annuity starling
date occurred prior to the em
ploye's death.
As mentioned, there are other
items as contrasted with life
insurance and employe death ben
efits that are taxable even though
not received or not received in
cash.
Q Suppose you take a new job
and your new employer pays your
moving expenses to the post of
your new duty for you, your fam
ily and your household posses
sions, is that income, even though
he pays for the transportation and
tor the mover directly?
A Yes on both counts.- But
courts have held that if your old
(present) employer, at his con
venience (and not yours), does
the same thing, you do not have
Income subject to tax.
Q Does a husband who trans
fers appreciated stock in a prop
erty settlement prior to divorce in
exchange for his wife's marital
rights have any income on the
transaction?
A The Supreme Court recently
said yes generally to the extent
of the fair appreciation in value
of the stock over its cost
Q How is alimony generally
treated?
A Ordinarily it is now taxed
to the wife receiving K and deduc
tible by the husband. Child sup
port designated as such in the
divorce, separation or other instru
ment is not, however, taxed to the
wife and not deductible by the
husband. It may however, entitle
the husband to a dependency ex
emption. Next: Medical deductions.
Morse Gets
Strike Job
WASHINGTON (UPD - Presl
dent Kennedy today named a
three-member board, headed by
Sen. Wayne Morse, D-Ore., to try
settling the longshoremen's strike
or recommend wnys to get ports
back in operation if no agreement
is reached.
'The point of public toleration
of this situation has been passed,
Kennedy said in a statement. "If
this case cannot be settled by
private action, then further public
action is required."
Kennedy said he therefore was
establishing the special board with
Morse as chairman. Morse is a
member of the Senate Labor Com
mittee and a veteran of experi
ence in labor relations matters.
Kennedy acted after receiving
a report from Labor Secretary W.
Willard Wirtz. The secretary ear
lier had been told by Assistant
Secretary James J. Reynolds that
his efforts to bring the parties
together had failed.
BLAMES RIOTS ON I'.S.
DAMASCUS, Syria ' UPD Syri
an Agrarian Relorm Minister
Amin Nafouri charged Monday
night that the United States had
fomented the riots in this coun
try over the weekend.
Nafouri made the charge W
lowing a cabinet meeting but did
not give anv evidence to hack it
up. One man was reported killed
and 24 injured in the violence.
HERALD AND NEWS, Klamath
YOUTH AND GOVERNMENT Discussing the preparation of a bill for presentation
at the YMCA Youth and Government events are Modoc Hi-Y members, John O'Hor
bein, left, and Don Christy, center. Judg Donald Piper, right, is district chairman of
the program designed to acquaint youths with -the legislative process of stats govern
ment. A Pre-Legislativa Assembly will be held in Ashland in February.
White Church Attitude
Pleases Negro Leader
CHICAGO (UPD - The Rev.
Martin Luther King Jr. said to
day it is "most gratifying to
Negroes" that America's white
churches are beginning to take a
moie active part in the fight
against segregation.
He said a hard-hitting campaign
for racial justice by hitherto
apathetic" religious bodies will
encourage Negroes to continue
their struggle by non-violent
means, and prevent their drifting
into movements such as the Black
Muslims which feed on "an at
mosphere of despair."
King, president of the Southern
Christian Leadership Conference
and pioneer Negro leader of non
violent resistance to segregation,
made the statement to reporters
in commenting. on the importance
Time Gained
By Tshombe,
Says Adoula
LEOPOLDVILLE, The Congo
(UPD Congo Premier Cyrille
Adoula said today he fears Moise
Tshombe is only seeking to win
lime with his offer to end Ka
tanga's secession.
In an interview with UPI, Adou
la noted that Tshombe had re
neged on his promises in the past
and felt he might be trying to
do so again.
The United Nations has an
nounced that Tshombe had agreed
to go from his stronghold at Kol-
wezi to the Katanga capital of
Elisabctliville Thursday to start
talks with U.N. officials on end
ing secession.
This move follows Tshombe's
previously announced surrender of
ills forces to the United Nations,
his promise to permit U.N. troops
free movement anywhere in Ka
tanga and his pledge to end seces
sion in exchange for a guarantee
of amnesty from Adoula's govern
ment.
However, Tshombe's Katangese
gendarmes and his white mercen
ary leaders still hold Kolwezi,
where vital mining installations
are booby-trapped and ready to
be destroyed if he gives the
order.
Dinner Held
By Engineers
A dinner meeting -was held Jan.
12 at Molatore's by the South
Central Oregon chapter of the
Professional Engineers of Oregon
Plans were discussed for local
activities during National Engi
neers Week which takes place the
week of George Washington's
birthday in February each year
National Engineers Week is sport
sored by the National Society of
Professional Engineers with which
the Professional Engineers of Ore
gon are affiliated.
Following the business meeting
program of projected cartoons
was presented by Ken Blackman.
City County Planning director.
which depicted the trials and
tribulations of a community plan
ner. Taste it
toasled!
Great way to
start the dayl
4aii.ilJJ.il II
FaUs, Ore.
Thursday,
of a "National Conference on Re
ligion and Race" in progress here.
"This conference is one of the
most significant and historic ever
held in this nation." he said. "For
Hie three major religious faiths
to come together to discuss ways
and means of breaking down ra
cial barriers is a most encourag
ing development.
First In Hislorv
The conference; first of Its kind.
in U.S. history, is sponsored joint
ly by the National Conference of
Churches, the National Catholic
Welfare Conference, and the Syn
agogue Council of America. Rep
resentatives of 70 Protestant, Cath-1
olic and Jewish organizations are
participating in the four-day
meeting, which will end Tuesday.
King said the churches and
synagogues can do a number of
things to "speed the transition to
an integrated society."
He said they can remove the
yoke of segregation from their
own bodies" by eliminating all
racial barriers in worship, and in
tile staffing and admissions poli
cies of church-related institutions!
such as hospitals and schools,
Urges Interracial Housing
They also can combat racial
discrimination in housing by "cd
ucating their members" to accept
Negro families in white neighbor
hoods without hostility or panic
he said.
Asked whether religious groups
should deliberately seek to help
Negro families obtain homes
all-white residential communities,
he replied:
"Yes. Churches and synagogues
should urge their members to go
out and make interracial housing
a reality.
China Quiet
On Congress
TOKYO (UPI) - Red China
maintained a frosty silence today
about the opening of the Commu
nist party congress in East Ger
many.
Peking's newspapers, radio and
news service all dedicated tools
of propaganda carried no men
tion of a five-hour speech Tuesday
by East German Communist party
leader Walter Ulbncht,
Presumably they will carry
something eventually, when the
party line comes down on Soviet
bloc charges that Red China's;
tough policies would lead to a dis
astrous nuclear war.
Red China's propaganda outlets
are customarily slow on such mat
ters except when it suits Peking's
purposes.
For example. Peking Radio
gave the world the first news of
the start of the Chinese-Indian
border war last, October so as to
portray it as an Indian attack
anainst Red China.
It was several' hours before be
leaguered Indian forces could get
word of the fighting in the remote
Himalayas back to their govern
ment.
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January 17, 1961
PAGE 7 A
Y Readies
Bill Study
Members of the six Hi-Y and
Tri-Hi-Y clubs of Klamath Coun
ty are now at work'prcparing bills
for the YMCA Youth and Govern
ment program.
The purpose of the program Is
to give youth an experience in
Die legislative processes of state
government and the application
of Christian principles to govern
ment and law.
As Southern Oregon district
chairman. Judge Donald Piper has
jurisdiction over the program for
Klamath Falls, Ashland, Med-
ford, and Roseburg. Clubs from
these communities will convene
at the pre-legislative assembly.
to be held at Southern Oregon Col
lege in Ashland on Feb. 16, to de
bate bills and learn about the
legislative operation of govern
ment. The clubs are selecting bill top
ics of Interest to them, then writ
ing them up as bills with the as
sistance of local attorneys. At
Ashland, the club representatives
will defend their bills against
criticism by adult experts and
other club representatives.
Those bills which "survive" the
Ashland experience will be used I
by their club delegates at the
YMCA Youth Legislature in Sa
lem March 28-30.
Wt can take a hint Whan people are a happy with temethlni at Pontlae own on art with Wldo-Traek, m'r willing nay, u(ar
to lot everybody tlsa In en it. That's why Tempost hat a WldTrack of Ht own thh yoar. It'i why you get to choose between
lively 4 ane a !2t-u. In. V-f too. We aim to please and If wt do say to, we're pretty accurate. 'Optional al intra cost.
Now there are two kinds of Wide -Track cars . . Pontiac and Tempest
SCE YOUR AUTHORIZED
Musa Awaits
Mark's Reply
On Tax Plan
SALEM (UPI) - Senate Presl
dent Ben Musa's own tax program
made its appearance today, and
Musa said he is waiting for the
governor to invite him to try to
work out differences.
Musa's tax plan, being spon
sored in the House by his wife,
would broaden the state income
tax base, but still retain most
exemptions and deductions. The
Hatfield plan would eliminate vir
tually all deductions to pick up
low bracket earners.
Hatfield said Tuesday he is flex
ible on the tax matter and real
izes a bill will have to be worked
out with legislative leaders.
But Musa said today he has not
heard from Hatfield on the tax
matter.
'I'll cooperate all the way In
the world, but I feel that I should
be invited," he said. "Of course
there is' room for negotiation. We
will have to do it in the end, so
why not do it in the beginning.
Gesturing at the telephone on
his office desk, Musa added, "If
the governor would call me right
now, I would go over and discuss
this matter." He said, however,
he is "tender-skinned" since the
governor rejected similar discus
sion two years ago.
The Musa plan would reduce
state income tax personal exemp
tions from $600 to $500. -and would
remove the federal income tax as
a deduction. Suggested rates'
range from three to eight per
cent, but Musa said theso could
be adjusted to raise needed rev
enues. Effect of the Musa plan would
be to increase state Income taxes
for some low bracket earners,
while reducing taxes at some
higher levels.
The Hatfield plan, also support
ed by House Speaker Clarence
Barton, D-Coquille, would remove
virtually all deductions.
Musa said he would be willing
to accept much of the Hatfield
plan "if he would call it by its
right name."
Hatfield calls It a net receipts
tax, but Musa said it Is really a
gross receipts tax, especially for
the salary earner. Musa said call
ing it a net receipts tax would be
"fooling the people."
MOOSE
CRAB FEED
SAT., JAN. 19th
Slrvino, Starts at 7 P.M.
$1.50 Par Parlor)
DANCE TO FOLLOW
If Wide-Track is as hot as
Pontiac says, why don't they
put it in their Tempest?
They just . did.
' V
PONTIAC DEALER FOR A WIDE
ECCLES MOTOR CO.
606 So. 6th STREET Klomoth Foils
"DENNIS THE MENACE"
WW
f j
ii i
SUCH A SWaL FIGHTER? WHi IS!'
Diplomatic Immunity
Denied Cuban Attache
NEW YORK (UPI)-A federal
judge today denied diplomatic
immunity to a Cuban U.N. at
tache accused of sabotage con
spiracy and threw doubt on im
munity for staff members of any
foreign U.N. Inissions and even
for U.N. ambassadors.
In a lengthy and perhaps his
toric decision, Judge Edward
W'cinfeld refused to grant Ro
berto Santicsteban a habeas cor
pus writ on the basis of diplo
matic Immunity and ordered him
to stand trial with two other de
fendants for conspiracy and fail
ure to register as foreign agents.
The federal grand jury has
charged that Santiesteban was a
member of a Castro-directed con
spiracy directed from the Cuban
U.N. mission which planned ter
roristic sabotage in the New York-
New Jersey area. The ring was
broken up by federal agents last
November.
W'einfeld said the framers of the
U.S. Constitution did not envisage
international organizations such
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WcfktUyt :M t 1:00
Jock's Super Market
Tultltkt, Calif.
CHOICE OF WIDE-TRACKS AND
as the United Nation?, and the
Constitution and later federal
statutes provide diplomatic im
munity only for diplomatic repre
sentatives assigned to the United
States, namely ambassadors and
public ministers." He noted that
the U.S. government has been
granting immunity to chiefs of
U.N. Missions but said this could
not possibly apply to staff mem
bers. Weinfeld's ruling implied 'that
the Cuban chief-ot-mission at the
United Nations has no claim to
diplomatic immunity because he
does not serve "any function to
the U.S. government,"
FEAT
ANN ARBOR, Mich. (UPD-
Tom Harmon of Michigan was
the last player to lead the na
tion's collegiate football stars in
scoring two years in a row, ac
complishing the (cat in 1939 and
1940.
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