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Thursday, March 24196$ TAX FACTS This column of questions and answers on federal tax matters is provided by the local office of the U. S. Internal Revenue Service and is published as a public service to taxpayers. The column answers questions most frequently asked by taxpayers. Q - My wife is filing her own income tax return. When I file will I still be able to claim her as an exemption? A • No. If she has Income, you may only claim her exemption when you file a Joint return and ^include her Income-- and deductions, if you them on that return. i; Q - I made less than $10,000 last year, including interest oh a savings account.. Will I be able to use the short form when I file? A • Assuming you are otherwise qualified, you can use the card form 1040A if all but $200 or less of your income consisted of wages reported on withholding statements,, and the remainder consisted of either wages not reported on withholding statements, dividends or interest. If any of your income came qualify as a dependent. You must meet the other require* ments, too, however. They are from a capital gain, for ex* ample, you could not use the short form. Q - What do you have to do to be able to claim someone as a dependent? I support my mother's brother but I've been told that I can't claim him since he's not a member of my household. A • Since your uncle is one of the blood relations listed in the law, he need not be a member of your household to test, citizenship or resident test, and the Joint return teat, see the 1040 instructions for explanation. Q - Does a common law marriage entitle you to file a joint return? A - If a couple is living together in a common law marriage recognized by - the state in which it was entered into, a Joint return may be filed. Q - Is there any (limit on what you can deduct per week for sick pay? A • Yes, there is. After the 30-day waiting period the max* inium is $100 a week. Details on the sick-pay exclusion for the first SO days are given in the 1040 instructions. Q - Some years back I had some medical expenses that Jb was able \ to-deduct on my return. Then I could only deduct that amount that exceeded a percentage of my income. Does that still apply? A- Yes, this limitation still applies for those under 65 years of age. Only medical expenses exceeding S percent of adjusted gross income may be Medicine and drug expense must exceed 1 percent of adjusted gross income before Inelusion in medical expense for the 3 percent reduction. For those 65 and over and their spouses, all medical, medicine, and drug expenses that qualify may be totally deducted. Q - How should I handle severance pay? Can I spread it out over several years? A • Income Is taxable in the year it is received. However, if the severance pay boosted your income by more than onethird what it normally is then the income averaging provisions of the law may help you. Ask for Schedule O of Form 1040 at any IBS office to get full details on this. Q - I had some major pur: chases last year like a new car, color TV and dishwasher. Can I add the sales tax I paid on these items to the amount listed in the state tax table? A - Yes and no. You may use both the sales tax table and add the actual amount of deductible tax paid on your car. Other large purchases such as the TV and dishwasher are already allowed for in the table. Q - I worked on a farm last summer. Can you tell me why my boss withheld for Social Security but nut for income tax? A • According to the law, most agricultural workers are not subject to income tax withholding. These workers are required to estimate their yearly income on Form 1040ES and pay their tax quarterly, social Secuity taxes, however, must be withheld. Q - My son is in medical school and I've been providing more than half his support. Can I claim him as a dependent even though he is over 21? A - Age is not a determining factor in whether he is youif dependent or not. If you provide more than half his support then you may continue to claim him as a dependent. Q - Three times last year I sold a few shares of stock in a company I have been investing in for years. How do I determine the purchase price of the shares for each sale a£ I bought them at various times at various prices? A - The principle that applies here when no other price identification can be made is "firstiji, first-ont." In other words, •©onSMaj? Uw Share* .you sold to W m flttit ones yoti bought and use their Sost, fhe next shares you bought to be the second ones you sold and ^ Q - The mutual fund I Won shares in made a capital gains distribution last yeftr. Do I pay t$x 0n it now pjr when I sell my shares? ">• A - Report this J>s capital gains on Schedule D rif Form iffil® .f<?r .the .year it was received or allocated to you. - Q - How shoud I Handle my home sale? I sold my old one at a profit but most of this gain w^s abosrbed by the higher cost of my new J)otne* - A- In general* profits from the sale of a residence are taxable, However, U another home IM pi^clmeed within a certain period, the tax on the gain Is deferred if the cost of the new home equals or exceeds the adjusted sales price THE McHENRY PLAINDEALER of the old home. Special rules apply . fo?.. Arsons 65 or olde* before the date of Sale or exchange. n Details on these provisions are given in IRS Document No. 5bl7, "Selling Ydur Home." Wilte your District Director for* a free copy. * Q - To help, my daughfef and son-in-law out, I pay the mortgage payments on their house about . 4 or 5 times a year. Can I deduct the interest and tax portions of these payments on thy return? ".-V. A • No, these are not de* ductible for you. Only the person legally responsible for making the payments may take the allowable deduction, and foen only If he actually pays them. North America has a population density of 21.4 people per square mile. By Advs.? By Prices? By Guarantees THE BOYS . m McHENRY GSWi Y@i-A 30-iMY 1@D% ©HJk'RAiffliE ©I PMTS AND LAi@R ON THESE CARS! 1965 DODGE 4-DOOR Clean, One-Owner 1963 CHEVROLET IMP ALA $ A Sharp 8-Dr. Hardtop 1965 DODGE MONACO Bucket Seats - Console 1965 FORD XL 2-Door Hardtop - Less Than 4,000 Mi. 1495 $2695 *2195 $lfi5 $1795 1295 $1695 We Have Ofer Cars As Low As $50.00 LOW BANK RATE FINANCING 1964 DODGE 4-DOOR All The Extras 1964 PODGE WAGON Here's A Buy 1963 RAMBLER 2-DOOR Hardtop -- A Beauty 1964 FORD SPORT COUPE Clean & Mech. A-l Open Sundays -- 9 a.m. to 4 p.m. SNNYSIPE DODGE SALES -- SERVICE -- PA1TS 4810 W. Bte. 120 McHanrr, 111. PHONE 385-7220 New Member* JoLo, Shepherd Of Hills '* Shepherd Of The Hills Lutheran church welcomed in spring by adding to its congregation. Received into membership on the bright spring sunshine weije Mr. and Mrs. Lloyd Duncan and. Dennis, Mr. and Mrs. Charles Meise and Dean and Dawn, Mr. and Mrs. James, Wallace, Nancy and , Deborah, Mr. arid Mis. John Huehne. Shepherd of the Hills is now offering two services to accommodate its growing congregation, at 8:30 and 10:30. Wednesday evening Lenten services are being held at 7:30. Section One -- Page Fife •f b«fi are faata|lM: aratdi hr HMM iosI PICK YOUR SIZE AND PRICE! 6:50-13 $18.33 7:00-13 **8.95 6:50-14/6:95-14 $19.19 6:00-15/6:85-15 $18.77 7:00-14/7:35-14 6:50-15/7:35-15 1J $19L."6 7 < * - 7:50-14/7:75-14 6:70-15/7:75-15 $20.64 8:00-14/8:25-14 7:10-15/8:15-15 $$2.33 , i 8:50-14/8:55-14 7:60-15/8:45-15 $23.92 9:00-14/8:85-14 fawonly) 8:00-15/8:85-15 (ww only) $26.80 •JD« Full 4-Ply Tyrex Rayon Construc- • tlon -- Safer . . . Stronger! •PR. Highest Quality and Service! tOm Premium-Built--- NEW Chlorobutyl "Safety-Liner" Hold* AIf 8 Times Betterl NEW Wider "Wrap-Around" tread--Better Con* trol... More TractionI NEW "Powersyn" Rubber--Gives You Up to 33Va% More Milesl NEW "Hi-T" Tyrex! Rayon Cord -- for Greater Strength . . . More Stability! Original Equipment Quality *18 6.50-13 Black Tubelees Tyrex Bayon Plus Tax •All prices shown are plus Federal Excise Tax. Available in whitewall at slight additional cost Ask About Cooper's NEW "NO-LIMIT" FULL SERVICE TIRE GUARANTEE! BRAKE 10 FRONT END SPECIAL Five Critical Safety Services * Check brakes, chcck for proper contact * Balance 2 front wheels * Align front end, correct camber, caster, too-in * Adjust steering. Plus FREE Safety Check On: * "'Tires *Battery *Mufflers *Shocks Tailpipes *Lights Take Your Car Where the Experts Are! Any U.S. Car $Q95 r~ TgR JEfSEii TIRE AUTOMOTIVE CENTEIf UuGEL AHGN.MEMT BRAKES C3f)PPiGQ£ SHOCKS JEPSEN TIRE & AUTOMOTIVE CENTER 3314 W. Elm Street Phone 385-0424 TWO LOCATIONS 3331 W. Elm Street Phone 385-0426 A MESSAGE 10 CLASSIFIEb USERS Bifore you call ah ad-visor to place your consider this: AD You are about to invest money for an ad and you «are entitled to get results. To accomplish this it is necessary for you to TELL ALL about the details of your offer. Be sure you don't make any of the following errors that prevent results: I. MITT OMIT THE ADDRESS Many out-of-town readers will write you, but will i>o,t spend money for a long distance call. zi&TTOMITIH PHONE NUMBER Many readers will call you but do not find it convgnifent to come to your home. 3. MOT USE BUND BOX NUMBERS Avoid them if at all possible. They are difficult to answer and many people are suspicious of thejft. TP fWCE igSIRED Survey^ show that a high percentage of readers will not answer an ad unless the price is giyeii. 5. 6®lrf LEAVE HOME newre Many good prospects will not call the second time if your phone is unanswered. t. MOT OMIT S«tt Readers can't guess on important details. Remember, a well written informative ad will get results faster and amount to much less in the long run. 7. DONT OUR LC k RME C0NS1CW INSERTIONS You'll get the biggest parade of readers at ^he lowest price. Your Needs Satisfied thru a^McHenry Plaindealer Classified. \ McH sjiry Plaindealer CLASSIFIED DEPT, 385-0170 •