the Commissioner of Annual Report Internal Revenue

Reference Do Not Remove the Commissioner 9M of AnnualRepon Internal Revenue fl'o

0 Presid nt Nixon greets Commissioner Randolph W. Thn-ar, after naming him :nd IRS Chief Counsel K. Martin Worthy, nown at the Commissionees teft, to the I National Council on Organized Crime. .1..mtary. of Treasury, Dawid M. Kennedy (faIt th PresldenVs rIghL Also Pictured .lng-~e camera) left to right are Postmaster General Winton M . Blount and Assistant Secretary of Treasury Edwin S. Cohen. enlarged the scope of its firearms I believe the Service has achieved With kind regards, D@pfftn@a V~ program under the licensing and gratifying results this year in car- Sincerely , registering provisions of the Gun rying out a multiplicity of programs Control Act of 1968 . Arrests, seiz- with limited resources--only a fe w ures of firearms, and criminal cases of which I have discussed here. 1 4(OW441of tv. TA40e4mr-V completed all rose sharply com- am confident that with adequate Internal Revenue Service pared to results in 1969, the first funding and your continued sup- 9@ 9@9M year of operation under the new port, together with action taken and Randolph W. Thrower, law . p!ans formulated by the Service for Commissioner of Internal Revenue . Honorable David Kennedy, Dear Mr . Secretary: refunds to taxpayers. In the area The pattern of growth in our tax . improving tax administration, the payer population requires the American taxpayer can anticipate Secretary of the Treasury, I have the honor to transmit to of delinquent taxes, a greater num- Washington, D .C. 20220 . ber of past due accounts were Service constantly to plan to meet better service at minimum cost in you the attached annual report of increases in work volume . Recent the years ahead . the Internal Revenue Service relat- closed, but unfortunately the inven . tory of past due accounts rose approval by the Administration and ing accomplishments throughout the Congress of three new service fiscal year 1970, my first full year when an even larger number of tax- payers failed during the year to pay centers, to be located in Long Is . in office . I believe the record will land, New York, Memphis, Ten- confirm that despite budgetary re- their tax bills when due . We fully recognize the additional nessee, and Fresno, California will strictions the Service made prog- give the Service an opportunity to towards laying the difficulties introduced for taxpay- ress in 1970 ers in using the new consolidated process a larger volume of returns foundation for an adequate level of efficiently and expeditiously . An . tax administration . return Form 1040 in the past filing period yet the evidence shows that other development that will help The workload of the Service con . improve taxpayer service is a sys- tinued to grow . Records were many taxpayers who formerly filed on Form 1040A took advantage of tem successfully tested in the broken when gross collections Southwest Region that gives al- soared to $195 .7 billion, an in- the opportunity of declaring addi- tional deductions and credits not most immediate response to in . crease of $7 .8 billion over last quiries regarding status of a tax- year ; 113 .1 million returns of all permissible an the short form. In this year of transition, more tax- payer account by visual display of types were filed compared to 110 .7 results through a computer where million in 1969 ; and refunds issued payer errors were forecast so we were surprised when error rates on tax data is stored . Known as an In . exceeded by 3 .4 million the record tegrated Data Retrieval System, it set 2 years ago . returns filed failed to show a signif . icant rise . Looking ahead, sugges- permits a local office to respond to Practically all returns received a taxpayer request by flashing on a during the filing period were proc . tions received from members of Congress, the news media, tax screen the current status of the essed by June 30, a feat never taxpayer's account . Moreover, ad . attained in the past . This accom- practitioners, and the general pub- lic are being thoroughly reviewed . justments to taxpayer accounts can plishment enabled us to update ac- be effected immediately rather than counts faster and issue bills and Those that merit adoption, together with Service plans to streamline the having to pass through a series of statements sooner than ever be- transitory stages . fore . Almost all the 55 .3 million consolidated return Form 1040, refunds due were mailed within a will be reflected in the return form few weeks after the returns were to be used in the next filing period . filed, which achieved a two-fold im- Over the past few years the Serv- provement-reduced Government ice has experienced difficulty ad- interest payments and accelerated ministering tax laws applicable to I exempt organizations . In Novem- ber 1969 1 appointed a committee of 15 distinguished Americans to serve as consultants in resolving technical problems relating to the status of organizations applying for tax exemption . This committee as- sisted in defining terms such as "religious", "educational", "prop. aganda", and "political activity" and serves as a sounding board for new approaches to the audit of exempt organizations . The Service also participated in the fight against organized crime by increasing its contribution to Federal strike forces now operating in major crime areas throughout the country. In addition, the Service Report Highlights on

Operations Million s

1969 1970 Percent Change

Gross Collections ...... $187,919 .6 $195=1 +4 .2 contents Refunds : Number ...... 49 .6 W +11 .4 Amount ...... 12,94Z6 16,18R.1 +25 .1 Returns filed ...... 110.7 lal +2 .2 Letter of Transmittal / iv Returns examined ...... Z5 211* - 20 .1) Additional tax from enfortement . . 3,368.3 32OLI +12 .8 Report on Operation Delinquent taxes collected, total, . 1,939 .3 2,517.6 +29.8

Informing and Assistings Taxpayers / 3 *P.1fl.jjY H..w Receipts, Refunds and Returns Filed / 13 Enforcement Activities / 2 1 Organized Crime Drive and Firearms Activities 1 43 International Activities / 5 1 Legislative and Legal Activities / 61 Planning Activities / 67 Management Activities / 77

Organizatlon-Princip~l Officers Organization of the Internal Revenue Service / 92 Internal Revenue Regions and Districts / 93 Service Reading Rooms / 94 Principal Officers / 94 Historical List of Commissioners / 98

Appendix Taxpayer Publications / 100 Tax Form Activity / 101 Court Decisions / 103 notes

Statistical Tables / 109 All yearly data are on a fiscal year Index / 139 basis, unless otherwise specified . For example, data headed "1970" pertain to the fiscal year ended June 30, 1970 and "July I" inven- tory items under this heading re- flect inventories as of July 1, 1969 . In many tables and charts, figures have been rounded and may not add to the totals which are based on unrouncled figures .

For sale by the Superintendent of Documents, U .S. Government Printing Office, Washington, D .C . 20402 . Price $1 .50 (paper cover) .

Report an Operations / I Informing Public Informed of Tax Law Changes Through Established ME[PUT and Assisting News Media One Taxpayers Taxpayer Service Continues to Expan d Publications Assist Taxpayers Revenue Bulletin Provides Official Tax Guidelines

.1/ Introduction Impact of NewTax Laws Media use of public informa . shooters and 100,000 gun collec- tion materials was extensive . Espe- tors of their responsibilities . The The American tax system , The Tax Reform Act of 1969 cially popular with newspaper edi- Service also provided approxi . founded on the democratic prin- posed many return filing problems tors was the weekly "question and mately 396,000 local and 47,000 ciple of self-assessment, would because of its far ranging effect answer" column ba~ed on the most state police personnel with greater likely create insoluble problems in and varying effective dates. The frequently asked taxpayer ques- insight to their roles under the Gun voluntary compliance outside the Service noted early in the filing pe . tions . The column was used dur- Control Act . realm of a free society . In contrast riod that many taxpayers were ing the filing period by 1,132 daily Public information support was United States citizens' responses waiting for additional instructions and 4,035 weekly newspapers- given to "Operation Disarm the to their tax obligations are truly re- on the new tax laws before filing both new highs . A number of news- Criminal," a pilot cooperative pro- markable . In 1970 over 113 mil- returns . Sensing that this could papers continued to carry the col- gram of the District of Columbia lion tax returns were filed . To foster precipitate a deluge of last-minute umn after April 15 . Police Department and the Alcohol, a sustained high level of compli- filing and seriously complicate District and regional offices par- Tobacco, and Firearms Division ance with tax laws, substantial re- processing, a program was quickly ticipated in 5,500 locally-developed aimed at getting guns out of the sources were devoted to describing initiated emphasizing that the radio and television presentations. hands of criminals in the District tax filing responsibilities simply new tax laws affected only a very Service -produced materials were of Columbia . To inform the public and clearly, with emphasis on the small percentage of returns filed used by 4,235 radio stations and of the program objectives and importance of accuracy and time- for 1969 . The information further 720 television outlets . The Service methods of operation, the Service, liness. Other efforts designed to pointed out that most changes made available 16 television spot in conjunction with the District of strengthen voluntary compliance brought about by the Tax Reform announcements, a 271/2 minute Columbia Police Department, ar- involved clarification and simplifi- Act of 1969 related to later years. color film for television, a 12-min- ranged for television spots, post . cation of form letters and notices Of immediate concern were the ute slide presentation designed for ers, bumper stickers, special and broadening taxpayer assist- retroactive provisions because they use at group meetings, and a num- notices, press releases, bus show- ance throughout local offices. affected periods for which some ber of radio spot announcements . cards, and flyers . Arrangements These and other programs to in- With the new Form 1040 these To call attention to the new Form 1040 returns could already have been A 10-minute film emphasizing er. were made for in-depth interviews form* and assist taxpayers are de- during the filing period, posters ware filed at the time of enactment . ror prevention was prepared and of enforcement personnel working benefits can be claimed with a min- displayed on mail trucks throughout-the scribed within this chapter. imum of additional preparation . country. Pictured here Is Postmaster Within a short time after passage used throughout the country. in the program, for broadcast pur- More than 23 million taxpayers Harry Kizirlan of the Main Post Office in of the Act, several public an . Throughout the filing period, poses . This Federal-local effort was Providence.,11J., affixing the first poster to Public Information filed a single sheet tax form in one of his mail trucks. John J . O'Brian, nouncements were issued describ- Weekly taxpayer error statistics highly successful in uncovering Internal Revenue Service District Director, ing major provisions of the Act were made available gun violations in and around the In anticipation of the 1970 fil- 1970 . Another 14 million taxpay- by service looks on. and keying them into specific tax centers to field offices so local news Nation's Capital . ing period, three major public in- ers required only one additional formation campaigns were con- sheet for particular classes of in- return forms and filing periods . releases could pinpoint problem The circumstances under which areas . To encourage prompt fil- Over 28 Million ducted covering introduction of the come or deductions . amended returns could be required ing, weekly news releases were dis- Taxpayers Serve d new tax return Form 1040 ; identi- The Service developed a pub- The Service has engaged a pri- were also noted in these announce . tributed citing the number of re- fication of most common taxpayer licity campaign to minimize the im- vate concern to review and report Almost 28 million taxpayers ments. Several new forms (includ- turns filed and refunds issued . errors ; and urging taxpayers not to pact of the changeover for the on taxpayer experience with the either called (18 million) or visited former 1040A filers . Special "1040 ing forms for fiscal year computa- delay filing returns in anticipation new Form 1040 and its related tions) were developed on a "crash" Firearms Control (10 million) Internal Revenue Serv . packages" were prepared for media ice offices in 1970 of tax law changes . schedules. The results of these basis. . An additional For many years, individual in- use, with emphasis on television, studies will aid in developing the As the administering agency for 2 million to 3 million taxpayers come tax was reported on Forms newspapers, and magazines. The 1970 form and schedules. gun control legislation, the Service requested tax forms and publica- 1040 or 1040A . The latter could Service also distributed 50,000 Increased Use of provided information on the vari- tions. Media and Public be used if wages did not exceed posters to postmasters for display Error Reduction Goa l ous provisions of the Gun Control Dealing with the ever-increasing $10,000 and if income was limited on the sides of mailtrucks during Forum s Act of 1968. Materials were devel- millions of people seeking help and to a few sources other than wages . January 1970 . To reduce mistakes on individual Service personnel gave more oped to inform 200,000 target assistance is an important part of Form 1040A was not designed to During the filing period, there income tax returns, the Service than 5,500 speeches to civic and provide for various deductions au- were complaints about the disap- conducted a publicity campaign practitioner groups, handled more thorized by law. Its few entries thus pearance of Form 1040A, owing in alerting taxpayers to the most com- than 40,000 media inquiries, and led many taxpayers to overlook large measure to the discomfort as- mon errors . Subjects covered arranged for approximately 3,500 benefits to which they were sociated with filling out an unfamil- through all media were : Use of the interviews throughout the country . entitled . iar form . Although many taxpayers wrong tax table or column, mathe- Numerous news releases, techni- This year the Service consoli- found the new form an improve- matical errors, incorrect or omitted cal issuances, and other printed dated Form 1040A and the regular ment, others complained that cer- social security numbers, missing materials were directed to the Na- Form 1040 into a new Form 1040 tain new features were confusing . statements or schedules, missing tion's daily and weekly press . which provided for claiming bene- Consideration has been given to signatures, and failure to attach fits overlooked by former 1040A these and related adverse com- W-2 forms and other supporting filers . Many taxpayers in the past ments, but the Service is convinced documents . The error reduction denied themselves advantages of of the soundness of the basic prin- campaign was geared to the Well-trained Taxpayer Service claiming head of household, sick ciple of a single return form for re- idea that "errors can delay tax Representatives each day help many pay exclusion, and other benefits . porting income by all taxpayers . refunds ." taxpayers fill out their Federal tax returns.

4 / Annual Report / Chapter One I Informing and Assisting Taxpayers / 5 the total Service effort . Much time The concept of a network of toll- churches. After completing insti- volunteer tax ...let. . far senior It[ ... is devoted to developing a corps of free lines was further pursued dur- tute training, these individuals pro. receive tralnIng provided by Service trained taxpayer service represent- ing the year. This system automat- vided tax information, in many personnel. atives whose primary objective is ically directs telephone inquiries instances on Saturdays and during to take care of taxpayer needs within a specific geographical area evening hours. Preliminary figures courteously, efficiently, and expedi- to a-centralized taxpayer service show that over 104,000 taxpayers tiously . station . Although not available on were assisted under the program Year-round service was provided an extensive basis, this toll free designed for lower-in.come groups. present to Service employees de . by 1,176 taxpayer service repre- service has been popular with tax- tailed explanations of the provi- sentatives at 373 locations and on payers and will undergo further New Look for sions of the Tax Reform Act of designated days at remaining Serv- experimentation . Reception Area s 1969 . ice locations . During peak filing Many offices tried different ap- Examination of professional jour- periods, these personnel are aug- New facilities were provided in proaches to add an extra dimen . 41 Internal Revenue Service offices nals, periodicals, and other tax mented by temporary employees sion to taxpayer service. Through literature provided constant infor- trained to answer questions of lim- the use of taxpayer service mobile in 1970 . This continues the Serv- ice's 5-year program to remodel mation about tax thinking outside ited scope. Additionally, employees units-taxmobiles-several dis- the Service . This identified articles from other organizational activities tricts in the Mid-Atlantic Region taxpayer reception and service areas into a nationwide network of administration is indirectly en- on tax avoidance schemes, criti- are assigned as needed to maintain provided service in inner-city areas, cism of Service administrative in- the desired level of service during at shopping centers, and near attractive and functional offices . hanced by this effort . Specific bene . fits hopefully will come from the terpretations, and suggestions for peak periods . apartment complexes housing legislative changes. Such articles older citizens . Some offices pro- Plain Language Publications Service cooperation with the Small Help Taxpayers Business Administration in provid- were digested in the bi-weekly Re- Plans for Improving Service vided service through joint efforts Ports on Current Tax Literature . Become Realities File Proper Returns ing technical assistance in the re- with State and city governments . view of tax material appearing in This kept Service officials informed This was a year of innovation . A Many booklets and pamphlets and alerted to the need for ap . Special Assistance its publications. Other publications number of ideas that had been in were published and distributed dur. that illustrate assistance to other propriate action . blueprint stage for several years for Older Citizens and ing the year as part of a continuing Brief digests of legislative Lower-income Group agencies are as follows : Federal In- came off the drawing board for program to help taxpayers under- *Corne Tax Information for Armed changes, new regulations, court testing, limited operational try-out, Training was expandeds and stand and,apply the technical pro- Forces Personnel; Social Security decisions, Revenue Rulings, Reve . visions of the statute, regulations, or full-blown adoption . For exam- other special efforts were under- This taxpayer Is receiving assistance at a and Your Household EmployeeS nue Procedures, and other material and official rulings . More than 80 ; were distributed to field offices ple, 1970 was the first full year in taken to make tax information neev Intemim booth composed of portable Special Information About ocial which standard procedures were more readily available to older citi- of these publications provide self- panels and a folding table . every four weeks . This pocket-size help guidance for taxpayers in pre . Security for People Who Receive instituted for referring taxpayer zens and lower-income groups . CorpsCash Tips Volunteers; and Tax Guide for Peace booklet, entitled Tax Briefs, uses an inquiries to another location, in- Both programs were staffed by paring their tax returns . Changes in the Tax Law, which pro. . informal writing style and groups stead of back to the taxpayer, when volunteers to provide tax informa. Most publications were revised vided information about the Tax the digests in type-of-tax or sub. during the year to reflect new de- For further information about inquiries could not be answered at tion and help under programs Reform Act of 1969 . More than current publications see page 100. ject areas to give revenue agents the initial point of contact . This sponsored by associations of re- velopments in the tax law. In ad- 21/2 million copies of this 16-page and other interested employees a helps immeasurably to prevent tired employees, community action dition, the material presented in publication were made available to Publications Broaden Technical quick view of current technical de. the Tax Guide for Small Business frustration on the taxpayer's part . groups, civic organizations and taxpayers by mid-January, high- Knowledge of Service Employees velopments in their various areas was substantially reorganized to of special concern . improve its appearance and reada lighting the tax law changes im- Other publications were pro- . portant to taxpayers in filing re- bility. The 1970 edition of the turns for 1969 vided by the Service for the bene- Public-use Forms and Farmer's Tax Guide and in planning for fit of employees who are respon- incorporated 1970 . Form Letters Improved suggestions received from repre- Other publications that were re- sible for the technical aspects of sentatives of the United States De. tax administration . The Quarterly A large number of forms and vised to incorporate additional ma . Review of Technical partment of Agriculture . terial included several of limited Develop- form letters are used to facilitate Continuing as one of the Gov. ments-Income Tax explains new necessary communication be- subject matter coverage, such as developments in tax legislation, ernment's best sellers is Your Fed- Tax information for Students and tween taxpayers and the Service . eral Income Tax, regulations, court decisions, and Improving the tone, quality, and a 160-page book . Parents, Tax Benefits for Older let designed to aid individuals in Americans, Tax Information on published rulings affecting indi- clarity of these forms and form filing their income tax returns . It vidual and corporate income taxes. letters is the goal of a continuing Selling Your Hofhe, and Appeal The Annual Review of Technical provides answers to a broad range Rights and Claims for Refund . program of centralized review in of questions of interest to many Developments-Employment, Es . the National office . Review has The Service reviewed for techni- tate, Gift, Excise Taxes is a com- taxpayers. cal accuracy several tax informa- been completed of all National Of- . Of particular interest this year tion publications issued panion fiscal year publication that fice forms and over two .-thirds of by other comprehensively discusses devel- the approximately was the Highlights of 1969 Government agencies. Effective tax 3,000 field office opments in the named special fields forms . As new or revised forms are of taxation . The Boston District n- 1. able to . .,It developed to accommodate the taxpayers In preparing their returns by At the end of the fiscal year a needs of tax administration, they Mass production methods through the use special Review of Technical De . of ansparenclas and projectors. are subjected to the centralized velopments was being prepared to review.

6 / Annual Report / Chapter One I Informing and Assisting Taxpayers / 7 Regulations Aid in the lines for those taxpayers with dif- As new rulings are published it serves a public rather than a As a result of statutory or regula- or nonacquiescence in 57 adverse ficult transitional problems under each year, the cumulative effect of private interest, whereas the other tions changes, or for other reasons, decisions of the Tax Court also Uniform Administration the Tax Reform Act and to enable all outstanding rulings is to pro- is not exempt because it is oper- it may be obvious to an astute re- were published . of Revenue Laws taxpayers to make elections pro- vide more authoritative guidance ated for private benefit rather than searcher that some of those rul- The contents of the weekly Bul- vided under numerous provisions to businessmen and other taxpay . for the exclusive benefit of the ings do not represent current state- letin normally are cumulated semi- In order to provide uniformity of the Act . Guidelines of this nature ers in planning transactions and in public. Underlying the exemption ments of Service position even annually and published in bound and to bring clarity to the Internal have been provided principally in filing returns. These published rul- for the first hospital is the theory though they ostensibly are still out- volumes, known as Cumulative Bul- Revenue Code, Congress has au- the form of temporary regulations ings officially establish the Service that, under the general law of standing . In other cases the old rul- letins . These indexed volumes thorized the Secretary of the Treas- and it is contemplated that similar position, and they may be cited and charity, the promotion of health (as ings may state Service positions make up a reference library for ury or his delegate to prescribe reg- rules will be incorporated in perma- relied upon by Service employees well as the relief of poverty and the that are still applicable to current use by those concerned with Fed- ulations . By means of regulations, nent regulations to be issued sub- in examining all returns involving advancement of education and reli- transactions although the underly- eral tax matters . Because of the Internal Revenue Service person- ject to the notice of proposed rule issues covered by the published gion) is a charitable purpose . ing statute may have been subse- extent and significance of tax iogis- nel who must administer revenue making procedure affording inter- rulings . Revenue Ruling 70-101 relates quently enacted in different form. lation during the first 6 months of laws and the public who must con- ested parties an opportunity to Internal practices and proce. to the Federal tax classification of In many other cases, it has been the fiscal year, two Cumulative form to revenue laws, are given comment . dures that affect taxpayers' rights professional service organizations difficult even for a careful re- Bulletins were published for that appropriate guidelines which mini- Presently, a massive regulations and duties are published as Reve . formed under various designated searcher to determine the current period . A special edition, Cumula- ,mize administrative discretion and program is underway in the Service nue Procedures . Procedures of State statutes. In light of several effect of the old rulings . Therefore, tive Bulletin 1969-3, contains the encourage uniformity in applica- in an attempt to develop appropri- continuing significance are periodi- decisions of the Federal courts, this review program was under- voluminous Tax Reform Act of tion of the taxing statutes. ate regulations under the Tax Re- cally incorporated into the State~ organizations of doctors, lawyers, taken for the purpose of officially 1969 and other Public Laws en- Through publication of a notice form Act . Regulations projects have ment of Procedural Rules. During and other professional people or- listing as obsolete those rulings acted during that 6-month period of proposed rule making in the Fed- been scheduled for completion in the year, 32 Revenue Procedures ganized under State professional that are identified as not being as well as the related Committee eral Register, the public is gener- accordance with a list of priorities . were published . association acts generally will be currently determinative and repub- Reports . As an aid to researchers, ally made aware that the Commis- In this way, regulations will be is- The Revenue Rulings and Reve- treated as corporations for tax lishing those that are identified as a finding list of all the Code sec- sioner of Internal Revenue, as the sued in order of the greatest needs nue Procedures published during purposes , having significant application to fu- tions added or amended by the delegate of the Secretary, intends first . By the close of the year, four 1970 in the various tax categories Revenue Procedure 70-5 an- ture transactions . Tax Reform Act is featured. Brief to prescribe new or amendatory final regulations, 17 temporary are shown in the table below. nounced the conditions under digests of the important provisions regulations . All notices invite writ- regulations, and five notices of pro- which rulings will be issued under Internal Revenue Bulletin is of'that Act also are included . ten comments on the proposed posed rule making had been pub . Revenue Rulings and the Tax Reform Act of 1969 pend- Authoritative Instrument regulations and inform the public lished covering projects underthe ing the adoption of regulations that Cumulative List of of its right to request a hearing at Revenue Procedures Published For Informing Publi c Tax Reform Act . With respect to reflect the various provisions of and Service Employees Organizations Is a Guide which oral comments may be made other projects not under the Tax . Typ e Numbe r that Act . The . for Donors and on the proposed regulations . The Reform Act, 10 final regulations Internal Revenue Bulleti n Service Employee s usual period provided for submis- and four notices of proposed rule Published Tax Rulings Purge d is the authoritative instrument of sion of written comments and re- making had been published in the Total- . ------_ 667 the Commissioner not only for an. During the year more than quests for a public hearing is 30 A nnini,trtifi------28 As part of a continuing review nouncing official rulings and pro. 10,000 names of organizations Federal Register. Alcohol. tobacco, and firearms, 25 days . After consideration of the Employment taxes ------45 program, more than 600 pre-1953 cedures of the Service but also for (contributions to which are deduct- . .x and gift te . as ...... _ 15 published rulings were declared publishing other tax items as a ible for Federal income tax pur- comments and suggestions from Published Rulings Inform EstatE tax. ~ - ~ ~ . . . . . ------61 the public, the proposed regula . Exempt orgahl'atmes. ------4 9 obsolete during the year and 159 convenience to Service employees, poses) were added to a growing All Taxpayers Income is------I . 377 were updated and superseded by list . This list, Publication 78, is tions are revised to the extent of Administrative SellPan, on trust ------65 tax practitioners, and others inter- employment tax------2 republication under the current useful to individuals and to foun- found necessary, and a Treasury Interpretations ested in Federal taxes . The need Decision containing the final regu. statute and regulations. This re- for frequent and regular communi- dations and other organizations in lations is prepared, signed by the Technical interpretations of the Revenue Ruling 69-545 and view program has resulted in pub- cation is met by weekly publication . determining the tax treatment of Commissioner, approved by the Internal Revenue Code and regula- Revenue Ruling 70-101 are exam- licly listing more than 7,100 old Items published in the Bulletin contributions for charitable, edu- Assistant Secretary of the Treasury tions are announced by the Service ples of the more significant admin- rulings as not being currently de- during the year (in addition to the cational, and other specified pur- for Tax Policy, and published inthe as Revenue Rulings . During the istrative interpretations published terminative and in republishing Revenue Rulings and Revenue Pro- poses . It also serves as a helpful Federal Register . year 635 Revenue Rulings were during the year, and Revenue Pro- 372 for guidance under current cedures referred to above) include working tool for Service employees If time does not permit a notice published, for the guidance of tax- cedure 70-5 illustrates the an- law. 13 Public Laws with related Com- in informing taxpayers or in ex- of proposed rule making, regula- payers, tax practitioners, and Serv- nouncement of internal procedures This review program was under. mittee Reports, three Executive amining returns . It is reissued bi- tions are issued and published in ice employees . Publication of that affect the rights and duties of taken because of an awareness Orders, 32 Treasury Decisions set- ennially to reflect additions and the Federal Register immediately . rulings is a significant factor in pro. taxpayers. that the contribution of outstand- tiing forth new or amended regu . deletions . In such cases, the regulations con- moting uniform treatment of is- Revenue Ruling 69-545 relates ing published rulings to effective lations, 16 court decisions, two tain a statement of the reasons why sues, both in filing and in examin- to the qualification of nonprofit tax administration was being some . amendments of the Statement of it is impracticable, unnecessary, or ing returns. Uniform application of hospitals for exemption from Fed- what hampered by uncertaffity Procedural Rules, one Treasury De- contrary to public interest to delay technical interpretations is an im- eral income tax . This ruling de- about the current effect of many partment Order, 19 Delegation the issuance of the regulations for portant aspect of tax administra- scribes two hospitals and con- old rulings . Several thousand rul . Orders, one revision of the State- submission of comments by inter- tion . cludes that one is exempt because ings have been published since the ment of Organizations and Func- ested persons. This procedure has initiation of the practice in 1919 . tions of the Service, and 126 An- been employed to provide guide- nouncements of General Interest . Announcements of acquiescence

8 / Annual Report / Chapter One Informing and Assisting Taxpayers / 9 Current information between re . to regulations ; 13 announced the Procedural Changes ing whether its plan is acceptable Other procedural changes were issuances of Publication 78 is pro- substance of Revenue Rulings and Adopted To Handle as- to form under the provisions of adopted regarding plans that pro- vided through the distribution of Revenue Procedures ; . two dis- Increasing Volume of the statute . A corporate employer vide benefits for self-employed bimonthly supplements . These cu- cussed the use of plastic and non- Pension Trust Activity which adopts a previously ap- persons (commonly referred to as proved master or prototype plan' H .R . 10 plans). Responsibility for mulative supplements contain ad . rigid liquor bottles ; four related to Several procedural changes ditions, deletions, and name firearms matters ; and the remain- may apply to its district director the issuance of opinion letters on changes of organizations . A new ing seven related to other matters were effected during,the year to for a determination letter as to the the acceptability as to form of series of supplements begins with of current interest . handle more effectively the increas- qualification of its plan . Although master and prototype plans for ing volume of work . related to pen- the employer's participation is im- self-employed persons was central- the first issuance for each calen- sion dar year . Technical Correspondence profit sharing, stock bonus, portant to the qualification of a ized in the National Office to pro- and 'bond purchase plans . Various plan, it will not be necessary under mote uniform application of the To assure wide dissemination With Taxpayers tax benefits are provided under the Service announces in the and Field Offices these circumstances for the dis- qualification requirements . Be- plans that are "qualified" in ac- trict director to examine all the de- cause of the volume of requests weekly Bulletin the names of orga . Many taxpayers write to the nizations that have been deleted cordance with requirements of the tailed provisions of a plan, since and the fact that most were ac- Service each year for interpretative Code, together with pertinent reg- they will have been considered at cepted without substantive change, from Publication 78 because they assistance where the proper tax have terminated their existence or, ulations and rulings. the time the master or prototype issuance of advance det6rmination treatment of their transactions can- In accordance with procedures plan was analyzed . letters to self-employed persons for other reasons, no longer qualify not be clearly determined from the previously announced, the Na- for deductible contributions . New application forms were de- who adopt previously approved statute, regulations, or published tional Office initiated the issuance veloped to be submitted by em- master or prototype plans was dis- rulings . Other taxpayers request of opinion letters regarding master ployers requesting that the Service continued . This resulted in a sig- Alcohol and Tobacco permission to change their ac . and prototype plans for use Industries, and Firearms by cor . determine in advance whether in- nificant reduction in the number counting methods or periods in ac- porate employers . Under the new dividually designed plans qualify . of determination letters issued . Licensees Notified of cordance with requirements of the procedures, a sponsor who de- Technical Change s statute and regulations, and vari- Standardization of the applications Details on the determination let- velops a master or prototype plan should help employers furnish nec- ter activity regarding corporate The Service continued to issue ous corporations ask for earnings can request an opinion letter stat- industry circulars to aid the alcohol and profits determinations . Dur. essary information to facilitate plans and self-employed plans are and tobacco industries in keeping ing the year 30,114 taxpayer re- processing . shown in the tables below . current with the requirements of quests of these kinds were an . internal revenue law, regulations, swered. rulings, and procedures . Firearms In connection with the examina- licensees were also kept current on tion of returns or claims for credit Determination letters Issued an employee benefit plans the requirements of the Gun Con- or refund, district directors may prolit Pension Much trol Act of 1968 and on the im- request technical advice from the It.. sharing ., .-ity bonus portation of arms, ammunition, National Office regarding issues ,line PI ... plan e and implements of war under sec- that are not covered by the statute, Determination letters issued with respect to - tion 414 of the Mutual Security regulations, or published rulings . 1. Initial qualification of plans : Act of 1954 . During the year 2,856 field office ld~j ...... 15,29 0 42 Plans Wu=`a, ...... 285 027 96: END 24,999 Of the 33 industry circulars is- requests were answered . Plans dIlIPP11% 17 7 23 3 ...... The taxpayer and field office re- b' .4 sued during the year, seven related cases closed without Issuan . . of deluranin .fild. . '136 1, '531 to actual or proposed amendments quests in the various tax categories are shown in the table below .

Determination letters Issued on benefit plans for self-employed person s

profit. Pensionp Bond Hour sharingplans lans Purchase Requests for tax rulings and technical advice plan ,

subject Total Tarrlsai,en ' Field requests Detsfifirinationsissued MIA res With- requests 1 . 10.1 qu.fif.ti.n of plans: in. ___ 11 : 110 11.: ,104 41511, Numb., at ...... 9 520 1 2 5 ...... 30,114 2,85 6 .. b. Plans di",prll.1 P, .. !d : : 4 66 ------C . 2- T.minat ion ----- 691 56 5 A-uhlinz. .h . .thad ...... _ ...... 2~ 722 2.722 ...... closed without issuifil, of determination letter am 1,215 23 in, penods ...... I I , 65 8 11,658 A"A'unodal anatters --- _ ...... _ . . ------. . . . . *- .------...... -. $2 21 ------Ad .j.1,tr.fi,. p,c,i.icn------...... 92 77 1 5 Alcohol . tobacco. and ...... 6,006 4.502 1 504 Earnings and profits ...... _ ...... 77 1 771 . . . ------Ernficy-t and 11h- ..pI .yh,.rt W...... _: _1 21 4 1 Engine t ,Iln,- - :: : :: : : ------1030 0 Estate :'~i"'d 1 1 ...... 49 7 Z 41 7 R D E-Ptoflanization ...... 2, 631 367 264 oth-ni . .W. . . ._ ...... _ ...... _ ------301 192 109 Oth ...... 5,656 5,25 5 401 P..:Wtnu.t,_ ._ ...... __ ...... 2,254 1 1,892 1 362

10 / Annual Report / Chapter One 404-M 0-71-2 - Informing and Assisting Taxpayers / 11 Receipts, - Collections Continue to Increase Most Collections Processed Refunds and Through the Federal Tax Returns Filed Deposit System About 65% of Filers Receive Refunds Increase of 3 Million in Returns Filed Returns Mathematically Verified up 30% Receipts Profits the chart shows a slight rise total employee-employer rate for Tax Collections Continue to Ris e through 1968, a jump in 1969 FICA increased from 8 .8 percent to Billion of Dalian Thomas Paine said, "Those wh o (primarily due to surcharge in- 9.6 percent, and SECA increased expect to reap the blessings of creases not covered by previous from a 6 .4 percent rate to 6.9 per- freedom must, like men, undergo estimated tax payments or with- cent. Both increases were effective 103.7 the fatigue of supporting it :" That holding) and a return to a more as of January 1, 1969. 97 . quote is particularly appropriate normal course in 1970 . In 10 years The Federal Tax Deposit (FTD) here because the next several this tax has doubled. System, inaugurated .in 1968toac- pages detail the story of our Na- With regard to tax rate change celerate the deposit of withheld tional tax collection effort for fis- for fiscal 1970, the tax surcharge, taxes to the credit of the Treasury, cal year 1970, which totaled which became effective January 1, continued to expand . In 1970, $195 .7 billion in gross revenue 1968 for corporations and April 1, FTD's accounted for $145 .0 billion receipts . 1968 for individuals, was in effect or 74.3 percent of all Federal tax What is $195,700,000,000? The through December 31, 1969 at the collection . This was an increase of magnitude of such an amount is 10 percent rate. The Tax Reform $11 .2 billion or 8 .3 percent over difficult to comprehend . Put in Act of 1969 reduced the surcharge the prior year . more manageable terms : to a 5 percent rate for both individ . Payment by FTD was extended to Federal Unemployment Act tax -Look at your watch for 5 sec- uals and corporations for the pe- ( UTA), January 1, 1970. This tax, 38 .3 37.4 onds . Your Government col- riod, January 1 to June 30, 1970 35.0 now payable quarterly rather than 33 .1 lected about $32,000 in that Increased rates for Federal In annually, generated revenues of short time span . surance Contributions Act taxes of roughly $768 .1 million for the last half of -With a population (FICA) and Self Employment Con- fiscal 1970, an increase of $136.4 200 million, collections of all tributions Act taxes (SECA) were in million or 21 .6 percent over the classes of tax for 1970 aver- effect for the full fiscal year. Th e comparable period of fiscal 1969 . aged approximately $983 for 15 .5 15 .9 you and every other man, woman, - and child in the United States . 3 .5 3 .7 In 1960, Federal tax collections Combined Individual Income 979 .1 =tIon Individual Employment Exists ad E.I. beass amounted to $91 .8 billion, more and Corporate Profits t- I A com - t- beeno gift lasses, than double the receipts for 1950, (before taxes) but less than half of the 1970 fig- ure . Since 1960, the steady rise Gross Internal revenue collections has continued, reachin g $195 .7 'billion in gross collections for 700 10ell.,, in in ..... it, . For d.t .11, so. table 1, p. 110 1 1970, an increase of $7 .8 billion or 4 .2 percent over fiscal year Percent .1 Increase or decreas e Sao San" . 1970 196S 1969 . 'llacti- Amount While increases in Federal tax Percen t revenues are pronounced, they Grand total '_ . ------...... 100 .0 $137,919,560 qWMW.V22MI' $7, 80Z 536 4 .2 closely parallel the upward trend of EPE Income taxes, total_------70 .9 135,7 78,052 '40INSUM 2,910,516 7. 1 personal and corporate income and Corporation-_ ...... ------_ ...... _...... &8, 337,646 -AWMAD -3 :231.663 - & 6 the general growth in economic ac. individual, ...... 400 E53:0 97,440,406 VRAUJM 11,179 6. 4 tivity . As shown by the chart Withheld by -Play., .' ------_ ...... 39 .6 70.4112,175 -v AnNelad,;M 233,89 5 10. 3 Oth .rx ------_ ----- ...... which presents data for the past . ~ -1 ------13 .4 27,258,231 09,=XU 21 : 02Z 716 -3 . 8 10 years, individual and corporate Employment in... toW...... 12 33,068,657 SI "WJM :1380,531 13. 2 30 0 . . . income have risen a total of $400 .6 Gross Tax Collections on Combined Otd-ain and disability insurance, hotal- ...... ---- __ 19 31,489.943 allegations 20Z 255 3: 3 Federal own .....Ujibuti. . . - 1&17.2 29,775,392 3 974 613 i' ...... * ------43,1010Me4agapar 13 3 billion, or an increase of 84 per- Self-employmnttnwrancecon r.,6utions . . ---- ...... _. 1.0 1.714: 551 127: S42 1321 . 3 Individual Income Unemployment insurance ------_------.4 640 030 cent since 1961 . Railroad retirement . ------136,109 . 3 20 0 .5 938,694 "MBOU 42,167 4. 5 In 10 years corporate tax rev. and Corporate Profits .7 138. 7 Estate and gift taxex, ...... ------_ ...... 1 9 3,530 065 dapaninge, 150 Oil 4. 2 135 Excise taxes, total-...... enue has grown from $21 .8 billion I 1 108.1 ... . ------8: 1 15,542:787 SWAKWM- 361:477 2. 3 to $35 .0 billion, up $13 .2 billion or Alcohol ------100 .9 75.3 78 .8 79.7 - Z4 4.555,56D ftimlin 190.822 . 4. 2 60.6 percent in a decade. V .4 71 Tobacco . . . . . ------_------_---- - 137.585 Other_ ...... _ ...... 24@K= -2 431~, 373 -2. 04 For tax collections on combined 41..16 8,949,642 4LONOM 028 z Individual Income and Corporat e Collections are adjusted to exclude innounts transferred to th% Government of Guam. Far detail, . .a table 1. P . 110 and footnote 5, P. 120. years 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 collectionsEllinated .-C.Ileclion, of individual income tax withheld are not reported npurmly from old-age and disability insurance taxes on Wages and salaries . Similarly. at individual in,.. . tax not ithh .ld - net reported separately from old-.9. and and disability insurance taxes a, sell-employmeni Income . The mount of old-age disability insurance tax collections shoem, is based on estimates made by the Secrenry of the Treasury pursuant to the provisions of sec . 201(s) 0~0 the Social security Actin In , ended, red includes .11 ld . .I . and dmabdit, insurance taxes . The rat-tax troven for the ? classes of individual Income tax . we, . d !led by subtracting . old . age and disability Insurance tax vatirr-lon from the combined totals reported . R .,.,ad .

14 / Annual Report / Chapter Two Receipts, Refunds and Returns Filed / 15 Refunds Pai d duced from 0 .9 cents (nine mills) Returns Filed to 0 .7 cents (seven mills), a de . In 1970, 55 .3 million taxpaying crease of 22 .9 percent. More than 113 million returns entities received a refund check About two out of every three were filed in 1970, an increase of from the Service, and usually, did Form 1040 filers received a re- about 3 million returns over the not wait very long . The number of fund this year. Since the average previous year, reflecting the con . refunds increased 11 .4 percent refund was about $241, and 54.4 tinued substantial growth of re- over 1969 . million refunds were issued, the cent years . In total, the Service returned Nation's individual taxpayers re- Tax year 1969 was, of course, $16 .2 billion in tax overpayments ceived $13 .7 billion in refund prin- the first year of use for the new including interest of $112 .9 mil- cipal . Interest paid by the Service combined Form 1040/1040A . lion (down 6 .4 percent) . Interest in 1970 for individual refunds de. More than 76 million new Forms per each dollar refunded was re- clined $4 .5 million (13 .8 percent) 1040 were filed ; approximately 20 to $28 million. million of these were received in Corporation income tax refunds the 5 days ending April 15 . amounted to $2 .3 billion, an in . crease of 33 .0 percent over 1969 . Interest of $70.9 million paid on corporation refunds was down 5 .5 percent from the preceding year .

Internal Revenue refunds, Including interest Fruitland, by,ishmi and district, laltelit, 5, P . 1231

r Amount refunded (principal Amount of interest Typeoftax Numbe hit aterest-thu.sad dollar,) (th ... and dell be,, 1969 I= 1969 Tig 33711 Total refund, of irstrun.1 learmori ...... 49,607,120 WMAY4 12,942.604 sigiftvas 120,095 212,923! Corpirstims memars, I ...... ------...... 49,3227 068 =3Aa 1 735 605519 2.ZYS~M 74,963 hatury Individual income and employment taxes, total a...... 26:509 smi .assites 10:939: Ulm~m 36,238 =A74 Number of returns flied, by principal type of return Excessive prepaymentand face . tin,~ ...... Orhe is ...... 48,594 IN U.M .5" 9,944,210 J1;gaSJ= 16,373 fFigures in thousands . For details, see table 6, p. 124 1 Other . . . FeceratI ,~,ancecontfibutlon$Acttaxwll--,- 703:64 19,588 Railroad retirement. .- ...... ------__ ...... CKAU 987,60 5 W 6 1$Al . . . . 5361 '111111 165 unemployment insurance ...... - 37 .602 U.S o 7,680 giiss a 27 1 Type of .tur n 1969 1970 The alsone, picture as reflect oparnationse In the retums processing' cycle. Este : ax ...... 944 nAcr 44,413 so~m 6,680 4,mas Grand total------_ ...... ------110,559 11114711 Gift ; a...... 1,234 1;M 1,69 1 Evoin, learn, total ...... --- 2'aaas 21 3 43,28a. 5 423n 321,790 22L= 2,001 3 .zo Income tax, total-, ___ ------_-- . . . . 86.702 M=s N ineteen -seventy was also the IndividualI and fiduciary, total . . . ------_ 76,215 -n;m Alcohol laxei...... 9 .063 Tobacco taxes 4- ~ ...... ------1AS 108,81 1 M.W 14 7 first1 full fiscal year for the Form 294 M 1 .594 ndividual-citizens and resident aliens, total__...... 74,962 1;gxgg Meriden 7,96 8 1.1= (*~ V) . .. . a' and retailers' each . halo, total ...... 3 .2v, 193,036 14 ~m 6 1 234 All other individual and fiduciary...... 1,253 1.26 040X, a now concept in amended Demlarotions of estimated tax, total . .------~7= tax returns . This form was well re- G.O.:inn :,used on for a ...... 7,102 Gas . ------53 4 M1 134,124 U.Sm ------ceived by indivdual taxpayers, and i minhighwey ...... I. . ._1...... _ ------25:031 Individual...... Oth rir~...... %A n 37 .71 5 2sAst ------7,096 .7.3ors 8 0 3 .1tv 21,197 615 7341 Corporation ...... __. __------6 H A about 533,000 were filed . The `Ch.~trarships p ...... ------_ form's success lies in its ease of ...... 956 237 All other excise taxes I 25,970 1 -assext 18,359 XAU 1 .373 i n 1.76938D I.M preparation, since only those items Other . .I!" ------m of information necessary to change Employment tax, total...... ------...... 22,032 Z~guk# .ursiurd,I Hlull,., in hall "of Wah Induced 1. efiect reimbursements from the Federal Old-Ag . and Stinnimrs, Federal Disability, and F,d. .l Hospital insurance Trust Ford, the original return are required . ,04 953 000 in 1969 and $36 8094 000 in 1970 from Empplomr: : Fix in 941 . ------_ ...... _ ------_ ------unimn'Wayortut T,uxt the Noway Trust Fund amounting to $223,755,DDO in 1969 and $32,074,000 in 1970; and train the 15,426 its,.7the Streamlined processing procedures V~hd mounting to $5J52 .66il in 1969 and $3.500, 1 . 1970. E. y Far. 942 (household emplovemi ...... 4,349 2~sxn a, at of 127M7 undeliverable checks totaling 118 ' 539 ' 000 in 1969 and 113,595 undeliverable checks totaling $14,182,ODO in Employers' Form 943 (agricultural "Pl for the Form 1040X have made ,, ud :,, refunds "not otherwise classified .' 1970. 563 us includ drawbacks andusedstamps far R freed retirement forms CT-I . CT-2_..Y!").------. --- I ...... _ ------21 11111 possible more rapid adjustments himisfinholimillki-.ify .no.. . I . Unemployment insurance. Form 940 .___ ...... --- 1,674 1.7" Includes lubricating all and refunds . Includes ruirso,,ties, silver, wagering (excise and at ships), capital stock, and other axis, tax refunds Estate tax ...... 1,,I~uddinIn, !1xm1,sn ...... _ ------123 122 ;1,A,.fund1. Gift tax,------...... 15 1 34111 Because of the favorable experl- x, IC .. . cliff. Excise tax , -Loss the. $500. 1,650 ~Jcal` ence with Form 1040X, the Serv- as Occu pa'aan ------...... ------1,016 m Form 720 (retailers, manufacturers, M) . ------_------300 2n ice extended the same concept this Alcohol_ ------23 Tobacco~ ------5 year to the filing of amended cor Highway0 use tax------_------_------_--- . . . 249 1 poration returns by introducing Is ...... ------56 Form 1120X . As many as 40,00 0 1 Includes 66 1120 ES and 2429 other excise for Ist. 6 mos.

16 / Annual Report Chapter Two

Receipts, Refunds and Returns Filed / ~17 g .144 _koE7f 14P corporate taxpayers will probably the service centers has provided Mathematical Verification 7- 1 1 Lk 1+' 01 use the new Form 1120X annually, benefits for both taxpayers and rather than amend their returns the Service . Taxpayers have bene- The tax return (on the followin g Combined Department of the Treasury / eIntatmellilemmusService fited from the accelerated proc- page .) is representative of the twith Form Individual Incom . Tax Return with a regular Form 1120 or Form 1 040 1040A am 269 843 claim . essing and refunding and the Serv- first page of some 2.8 million F, ,7 1-0-miser 31. 1969. or othm, taxable Year beeinnift...... 1969. soding Form 1040 returns filed in 1970 . rose - W annual (if Joint hands. - am amew .0 evislau. lawas, al low I Use - I I- sensual no." ..bw In 1970 the Service completed ice has reduced processing costs IL implementation of direct tax re- associated with the transs hipment The taxpayers who filed such re- turn filing required by legislation of returns between outlying offices turns made errors which would enacted in 1966 . Direct filing wit h and service centers. have cost them a totbi of $212 .3 11_rL_MW_M._2W*dw afid.WUo~lalm~L. c U million had the Service's computer- ized math-verification program not 7~70 / ze a detected their errors . Over 4 mil- or,. sameZpealofflo, lion other taxpayers weren't quite , , , ,, "I- as Enter` below yfrns and addres, "ad o~ YWI vatInn far less (I SOMS I a M. " - . filed. slive, so fortunate . Correction of their Impersts la lot or Islas to asomnate relturns. enter 19N . . -on dranows. Returns Filed Continue to Rise mistakes resulted in upward ad- in the Individual Area justment of tax liabilities totaling Nam and asuldrame of i~~r at tims off 1 1. $507.0 million . Unmarried Head of Household Including both upward and To.11% 1 .I IvIsigilifiloZe~ filing joint return (favein If only one bad Inomme) 05 0 Surviving widow(ar) with dependent child Status— downward. adjustments of tax Ii- 3 0 Mariled:=parste return end spirits is also filing a fietion. 6 0 Married filing generate noturn and spouse (Check give seem a and I security number in spm provided bility, about one in every 12 re- Is not filing a return only ono)11 above and enter flat name bar e 'lo. a turns contained a "math error" Check boxes for exemptions which apply Reve 65 or over 81;nd (improper arithmetic or use of in- 7a Yourself ...... 0 01-1. applicable tax rates, etc.) . On bal- an c0 Ins Spoons (applies only If line 2 or line 6 Is checked) ...... * V 0 0 ance, the Government realized 8::7First_ names_? _fy!urd indent;70 "1phildren who lived with yo u . 7 million from mathematical $294 E e Enter number 1, 2- verification of 88 .4 million Form oo~. = r,~mx name I I, the used 3 00% . roishe d . at ;~ -h .-fisted I 'dIn :3 sol 1040 returns . .1 (it -a- I. assava . - now West 0 The total number of returns veri- s. fied was up 22 .5 million or 34 per- $ a . cent over last year. The increase . 20 Total exemptions from lines 7,8, and 9 ...... was due to (1) 5 .4 million returns above ...... carried over from June 1969, to be processed in fiscal 1970 and 11 Wages. suslaries, Ups . aft. (Attach Form W-2 to back. It unavailable. explain on back) (2) processing of practically all returns filed during the January to E 12a Dividenth li...... 11: ft- 12) 22b Leds ExclusIon S...... Badence is . 12C June 1970 period . In addition to verification of 23 Internet (Enter total hem and It other $100, also list In Schedule B. Part 11) Form 1040 returns, the Service al- 0 so checked nearly 10 million claims >' 24 other incomes: Total from attached schedules ; (chKk whookfired, use" 0. 0 El E 0. F 0) -L4- for estimated tax credits, totaling Ad'u,tedGross $24 .6 billion . Of the total, $24 .2 15. Total [ 1'2, .. 7.5._ T,b I . Adjustment, [ I O'.,l 1 $ Income a- 15C billion were allowed, leaving a net 0 It line J So is $5.000 or to fig- nor and -halses. (O.It lin. 26 and 17.) fill Go to SCh . T to figure tax and surcharge It YGU Itarnift deductiOrrs; or Claim ratirsommot InConse Crardit, foreign tax Creft ar InVest- yield to the Government of $320 C nment -1-dit; or If I.. - twif-ployrnent tax ar tax from recomputing prior year inesufruent credlL (Omit firms 16 and 17J Ind'Admal [Indentures, Partnership Corporation Employment Excleas and million and Statutory penalties to- as it neither of abemne two items applies. go to Tax Tables instaund of SO. T. C.-Plt. Imas 16,17.6 18. and of ariffixemod .11 the, I fiduciary tax taling $65 million . 16 Tax from Tax Table (suns tables on T-2 Arid T-3) . . . . . yeanmaid,saxtea in will figervas and sandemes. 17 Tax surcharge online 16 (sumse T-1 for tax surcharge tables) . 27 1 0- 18 Enterif from totai ax efra l1bn,:sA26,arxd 27 OR amount from Schedule T, 11i"m 1188, ~fffa rable (check B 0, C [] ; Tax Rate Sch. Ia . Sch . D or Sch ~. G rI2c .! ' . Individual income tax returns mathematically verifie d 29 Total Federal Income tax fthheld (attach Forms W-2 to back) I . M.ke check or 2D F, F.I.CA tax with held (two or mom supplifirsons-even 0-2) . . money order pay- Itarn 196 9 22 E3 Krinhighway, Federal gasoline tm Form 4136 ; 0 Reg. fin, Farm 2439 able to I nternal P, R-enti, Starvsoo,ice,~ppas e 22 1969 Estimated tax payments (Include 1968 onsurpsyment allowed for Credit) . 22 Numb ...... thousand, . 65,923 10 Number of returns on which changes were made...... __ ...... _do.. . 5,360 0 23 Total (add lines 19, 20, 21. and 22) ...... 23 dr, Returns with Increase : Number...... do-. . . 3~ 31 4 itmount...... thousand delta. . . 315,103 up C 24 If line 18 Is larger then line 23, enter BALANCE DUE. Pay In full h niturIf ReturnsNu wi h denraus. : itroxual,ml* ------th..... dt .- 2,046 ...... thommad dollar,-- 140,236 as X, /0-0 In . Net Yield : 25 If line 23 is larger than line 18, enter OVERPAYMENT L25 Total ...... 174j867 a t 4vetaul. per return verified...... If.. .66 0 26 Line 25 to be : (a) Credited an 2970 estimated tax lv~ $ (b) Refunded le- $ /00 d o . declans I~Cavmolsvd 016. nature, achudke -I-. of --. a-,",- -1 ver -I-- a- -11. of Issal =h 70 .0.00 . U saw . .1 -4 than Waxen. a: so a n whomi . 0

18 / Annual Report / Chapter Two Enforcement Additional Tax and Penalties ' Recommended by Audit Higher Activities Than Last Yea r Most Appealed Cases Closed by Agreemen t Delinquent Collections Increase Tax Fraud Not Confined to Any Particular Social Group Laboratory Analyses Supporting Law Enforcement f

I Introduction tax liabilities. To a large measure tax laws and professional account. Results of Examination s their voluntary compliance is at- ing skills are necessary . Audits of In 1970, the number of returns A vigorous enforcement pro- tributable to their belief that most returns of employees, profession. examined totaled 2 .0 million, of gram is essential in preserving the taxpayers are also properly meet- als and some small businesses are .2 million resulted in rec- American system of self assess- ing their tax obligations. which 1 normally conducted by interviews ommended assessment of addi . ment . The enforcement effort The audit program is designed in Service offices or by correspond- . A total of serves as a deterrent to fraud, de- to maintain the integrity of the self- tional tax and penalties ence . These are referred to as "of. $3 .1 billion was recommended for linquency, and violation of the laws assessment system by examining a fice audits" and are conducted by assessment as a result of audit ac . relating to alcohol, tobacco, and sufficient number of tax returns of tax auditors who know the tax laws firearms products . The additional tivity. all categories to keep the possibil- and some accounting but are not The following table compares tax resulting from direct enforce- ity of an audit of a particular re- qualified to work on complicated numbers of returns audited in ment is only a partial measure- turn ever-present . Auditing returns accounting problems . 1969 and 1970 by type of return . ment of total accomplishments . The not only deters potential wrong- At mid-year the service installed more important accomplishments doers and ferrets out taxpayers a new mechanized system for re- Number of tax returns examined of the Service's enforcement activi- who knowingly understate their porting production and controlling ties are set forth below . tax liabilities, but assures uniform returns in inventory. Some adjust- ffigu- to thoularid1l application of the tax laws . ments were necessary to present Field 0 a The scope and nature of an in- Total Comprehensive Audit current and prior year results on a Type of retur n "M come tax audit depends on the in- comparable basis. Therefore, credit 196 9 ~gsrye,. 1969 un 1969 Most Claims for Refund Program Enhances Self- come producing activities of the production data for 1970 are par- Processed Rapidly particular taxpayer 69 8 42% 1,946 Assessment Tax Syste m . Field audits of tially estimated . Grand Total...... -- - 2,54 4 Vmo I.M Taxpayers who file claims for re- large and medium sized busi- Income tax, total ------54 9 " 1,823 Zge, fund are naturally anxious to learn Most taxpayers voluntarily file nesses are normally conducted by I'll , the results of the Service's con- Coup after------1...... 166 ~m 163 -in I tax returns reflecting their correct revenue agents since knowledge of ledl,ad .al and fiduciary . .. . . 2,19162 2,M 374 us 1,822 ~L= sideration and to obtain prompt 12 -40 (1) C.) Exempt organization .... ------payment of the amounts due them . EExist: and gift tax- . 42 m 37 Irt 4 A The Service has designed a sys- xcis and rrrnploYmWl~~;; ------. - 130 o0o . 1!1 .1 10 19 ge t Number of Tax Returns Examine d ------I r I I tem for rapidly closing claim cases . and Additional Tax and Penalties Recommende d - Partially estimated Many can be allowed in full with- out contacting taxpayers . Form 1040X (Amended U .S .-Individual Thousands 141111ow of Dollars Audits Also Result In Income Tax Return) introduced in Overassessments 1969, not only speeds processing Examining officers are required In 1970, Service examinations dis- 3,100 claims but reduces time spent by to determine a taxpayer's correct closed overassessments of $183 .2 taxpayer in preparing them. 3ALI M liability-no more, no less . When million, exclusive of claims initi- During 1970 the Service closed :n examining officer discovers that ated by taxpayers . Overassessment 396,346 claims for refund . Of I taxpayer overstated his tax lia- recommendations by type of tax $592 .5 million claimed, $260.0 2.544 bility, an overassessment is made . are shown below. million was allowed. The great- est number related to individual Overassessyments of tax exclusive of claims for refund income tax, 352,038, followed by corporation refund claims . 2 9 28,296 AnsoUnt meensendial Section 6405 of the Internal (thousand dollars) Type of tax Revenue Code requires reports to 11696 the Joint Committee on Internal 1,672 1969 low IXU7 Revenue Taxation of any refunds and credits of income, war profits, Total ---_------__ ------_ .. . . . ------203,747 Sam$ estate and gift taxes exceeding I ndividu .1 and fiduciary locence------48.082 Corporstio ------_--- 135,335 $100,000 . During the year 638 Extat ------_------_ ---_------...... 16,23 sit=scor cases involving overassessments ; of 895 Gift- ._ ------...... _-_--- ___ ------948' Exc 2,133 ,Z=2 $331 .2 million, were reported to ALr__1 Erefil':j;i~-i------* ------1,011 the Joint Committee.

- partially astinested 4LX 169 " 72 Total fird'irldnal corporation Estate Exclea Total lndi,id,.l r,erponsition Estate Easier and ad . .it gift and and and and gift and fiduciary exernist runplcrinninit fiduciary exernint reepliesessett suirinissitio g crg. .i.tion

i97o data inniaGy astiorited

22 if Annual Report / Chapter Three Enforcement Activities / 23 The following table shows data tax law as "religious," "education- Centralized Approach on claims closed by the Service al," "propaganda," "political ac- Now Used for 1969 and 1970. tivity" to permit a better under- All exempt organization field standing by exempt organizations work is now centralized in 16 key and the Service of permissible or district offices throughout the Claims for refund disposed of by district audit divisions, fiscal years 1969 and 1970 prescribed activities of exempt or- United States . Each key district ganizations. The Committee will al- has at least one group of specially Closed by audit divisions I so assist the Service to apply the trained agents who conduct ex- tax laws to novel experiments in aminations of exempt organizations number Amount (thousand dollars ) education, new expressions on re- Class of tax and process applications for ex- I ligion, and changing avenues for emption . Claimed by taxpayer Allowed Disallowed the application of charity to soci . A map showing the key districts . ety's present needs. A list of mem- 1969 Em . 1969 1969 snt. 1969 and the areas of their jurisdiction bers of the Committee appears on follows. Total- ...... ----- 353,361 M.4s, page 89. 394,653 .4SIAn 217,549 zs~eat 177,103 Individual Income ...... 306,916 3"Am 162,334 ~Mgacr 117,689 Corporation in ...... 4"ju " . 64 5 ...... 30 708 'JXX2 171 .195 IMAN 78,512 W,= 92 E .693 sectisers ...... - 1 2 : 364 .2 .= 29,232 M Gilt ...... ------_------;m Z 024 aus'auts 17.20 8 MA4 state . 396 in 9 19 17,410 a n Exmi...... _ 7 .318 sMo 1 .617 U W ...... 5,6 'MA 9' 3761 7'0=3 7,5099 2.318 751M Employment ...... ASO 4,03 198 %Ads 2.839

Pf0tated-transterreal to appellate divisions KEY DISTRICTS FOR ADMINISTERING THE EXEMPT ORGANIZATIONS PROGRAM Amount (thousand dollars Number ) Class of tax Claimed by import, Recommended b, audit divisions

Allowed 1969 'M 1969 Disallowed 1969 im- 1 1969 Total ...... 3,619 1AU 112.302 In,= 8,723 4.s" 103,57 9 Individual in,...-...... 1 7D4 Uncork . 9.589 ast'ass 1,106 1162 a 49 2 - 91 .146 7,4171126 3 An 86: 57 Estate, ~ - "s. . .------. . . -11 ...... 113 m 5,69 7 ass Gill ...... ------...... - 5 58 6 34 32 262 =2 1 ------'26 1 0 E - 46 4m 21 : 51 1 ,174 Employment"i------...... 2392 112 10 iscit, ,,, . 6 Ali n

ncludes claims all . . . d I. Nil without formal examination .ill;on . of the return : 1969-2617th. .,an d r .I.,r,xrd$I24 .I .JIIm ;1970-310 .2th~ .I .~d,,t.,~, .~d$158 .3 * partially estimated

southwest Exempt Organization Program Wide-ranging changes in the Tax missioners (Compliance, Data regio n Expanded and Improved Reform Act of 1969 made the need Processing, and Technical) . Fif. In 1969 the Internal Revenue for upgrading this activity even teen distinguished Americans have Service recognized the urgent need more critical. been appointed to serve on a now to take a complete new look at the In 1970 the planned expansion group, the "Commissioner's Ad . Exempt Organization Audit Pro . and improvement were accom- visory Committee on Exempt Or- gram aimed at improving the qual . plished. Highly skilled and moti . ganizations", which will aid greatly ity and control of these audits and vated people were selected and in this important program . It is greatly expanding audit coverage . trained in exempt organization composed of a cross section of the A new approach was necessary be- work . Quantity and quality of audits public, with members representing cause of the dynamic growth in re- reached the planned level . These a broad range of disciplines such cent years of exempt organizations improvements resulted from a con . as philosophy, theology, education, in terms of numbers, size and im. certed effort by many segments of physical sciences, economics, law, pact on most phases of our society. the Service and several important accounting and business . These organization changes. widely experienced people will help Service policy and overall direc . the Service define such terms in the tion is provided by a coordination committee composed of the Com- missioner and the Assistant Com .

24 / Annual Report / Chapter Three I Enforcement Activities / 25 Exempt Organization Examination Activity (1966-1970) Specialist conferees from each key district office visit areas away Direct exam"rus"tal Number of returns examined from district headquarters to hear disputed cases . If agreements are n ot rea ched in cases involving the 13 .33 1 le. iai, modification, or revocation 12,128 11 .94 5 of an exemption, the organization H.755 may request that its case be re- ferred to the National Office. 8 .552 Audit Program Responsive To Change There is an obvious need to re- vise the audit program when new tax legislation is enacted . Less ob- vious is the need to make changes because of the growth in size and complexity of many businesses and taxpayers' use of advanced 153. 6 technology in recordkeeping . Man . power shortages also require con . 112 .5 tinuing search for better ways to 110.8 108.4 utilize skilled examining officers . Several studies made during the year resulted in actions which help Development in Computer- This photo shows the volume of - 1966 1987 - 196 1969 -19io- 1966 - 1967 - 1968 - 1969 --7-nio- accounting records printed out by a 8 to maintain a viable audit program . Assisted Audit Techniques t-xP2Y0eS Computer for one year from As more and more taxpayers which a program selected Items essential Another step taken to strengtn- dations are examined at least once pended 153.6 man-years examIn . Scope of Office Audit to completing an audit. an this program was the establish- every 2 years. A 5-year exami- ing exempt organization returns . use computers for a major portion Stacks of printout, . .r. reduced to the Operations Enlarged of their accounting systems the few pertinent pages shown under the ment of the Exempt Organizations nation cycle has been established The graph below depicts the hand of Internal Revenue Agent Allen L Examination Branch in the Na- for other private foundations and volume of exemption applications Small business returns were Service recognized the need t~ use Wolfe of the St. Louis District. tional Office Audit Division. It other tax exempt organizations. received and processed over the shifted from field audits to office computer auditing techniques . With develops the nation-wide exempt During 1970, the Service ex- last 5 years. audits to release revenue agents to the cooperation of large corporate organization audit program and examine more difficult returns. Tax taxpayers-the Service has employed The Service designed the Dis- oversees and coordinates the auditors who audit small business computer programs which retrieve criminant Function System (DIF) Exempt Organization Determination Letter Activity returns are now permitted to make required accounting data directly and thisyear it has been used to se- efforts of all key districts. The new from the taxpayer's magnetic tape Branch assists in the planning and volume (1966-1970) out-of-office contacts varying from lect individual tax returns for audit . directing of audits of certain large, gathering information from, third files, thus eliminating the time. The DIF system employs comput- complex organizations whose activ- parties to examination of records consuming task of examining vol- ers programed with mathematical at taxpayer's place of business umes of books and records ities have a national impact . In 23,349 . . formulas which rate the returns ac- these cases, it reviews each audit Another important change is the in . While there is much to be done cording to the degree of potential plan and monitors audit progress . crease of the percentage of office to keep abreast of now develop- error . The returns rated highest in audit cases handled by the inter. ments in computer technology, the error potential are selected for The Branch also supplies many APPlications .!,ad other forms of assistance such as 22,21 7 view method and a comparable de . results to date have been gratifying examination . perfection of examination and pro- creasp in correspondence audits . in the speed and accuracy of data This scientific system reduces This modification will aid taxpayers retrieved. The Service is constantly the number of audits which result cedures and identification of train . 19,404 ing needs. who have difficulty with written exploring new and better ways to in little or no tax change and saves Audits of exempt organizations communications and improve au . use computers in auditing returns time previously spent in manual 17,893 dit quality. especially when they will increase screening. So far there has been differ both in purpose and in scope 17,367 from audits of taxable entities . The 17 .36 1 the quality of audits and reduce an excellent correlation between time spent on them . letter are basically financial audits, o.t nnlrati. .~ audit results and the potential er- 17,316 I.": while audits of exempt organiza- Wood ror ratings produced by the com- Computer Selection of Returns tions involve examination of activi- 15,675 puter, validating the basic princi- ties of the organizations to insure For Examination ples of the DIF system . 14.486 that they are in compliance with 14,394 Selection of returns for exami- the law granting exempt status . nation is a vital part of the Audit Emphasis is placed on the pri- Program . One of the main goals is vate foundation area . Large foun- to select returns having the great- est probability of error . 1966 1967 1968 19G9 1970

26 / Annual Report / Chapter Three 4104-061 0-71-3 Enforcement Activities / 27 Large Corporation Coordinated lion . In the last two years, changes disagree with proposed adjust . short time after the case is re- Appeals-Method of Disposa l in fair market value recommended ments to their tax liability . It has ceived . Convenience of the tax. Examination Progra m Numnalser of Can- by the panel total $10 .3 million . A been a long-standing policy of the -payer as to date and time is care- The goal of this program is to Service to provide an administra- fully considered. In office audit Norst docketed cases, list of members appears on Ilagettflesneed to Tax Caiurt Tobal identify taxpayers whose size, com- page 87 . tive appeals procedure to enable cases the taxpayer has an op- 21 .537 plex nature, and decentralized ac- taxpayers to settle these unagreed portunity for an immediate confer- 1969 29,756 tivities require special attention Interest Equalization Tax cases promptly, without litigation, ence at the time of examination if 1970 29,6Zg and a great deal of coordination Audit Activity Extende d on a basis which, is fair and impar- he desires, and circumstances per. between various offices of the tial to both taxpayer and Govern- mit . In cases in which the disputed Service. The interest equalization tax has ment. tax is less than $2,500, a written Audits of giant corporate tax- helped to strengthen the balance- The appeals procedure gives the protest is not required for confer- payers usually involve the use of of-payments position since its in- taxpayer an opportunity for an ence in the district office. The same ception in 1965 by reducing the more than one internal revenue early, convenient, and independent rule applies in the regional appel- B.27 8 agent and frequently require spe- dollar amount of foreign securities review of his case. In an over- late office provided the taxpayer cialists skilled in such tax areas as purchased by U .S. persons. To whelming majority of cases a mu- has first availed himself of a dis- international operations and engi- guard against the risk of capital tually agreeable resolution is trict conference. neering . Usually these audits must outflows, the law was extended attained . The success of the pro- The taxpayer may represent be simultaneously conducted in from September 30, 1969, to cedure is evidenced by the fact himself or be represented by coun- 1,373 the Interest several locations because of the de . March 31, 1971, by ,that during the last five years over sel . Both offices are independent of 1,154 centralized nature of the business Equalization Tax Extension Act of 98 percent of all disputed cases the examination branch and give F-LS-6 1 94 6 operations of these taxpayers . The 1969 . were closed without trial . impartial consideration to the 72. F~ newly established Coordinated Ex- Enforcement in this activity in- The appeals function operates issues in controversy. aminaiion Branch in the Audit Di- volves audit of returns, and inspec- at both district and regional levels vision, National Office, provides tion of record systems of approxi- through 58 district conference Taxpayer Has Other 2GG planning and leadership to insure mately 1,200 broker-dealers and staffs, 40 regional appellate divi- Options Available I banks (designated by the Service LEE Li L_ U L __ L_ high standards are maintained in sion offices, and, as the - need If agreement is not reached at Agreed U.eg,..d Defaulted an Agreed Dismissed the execution of these large audits . as participating firms and partici- arises, at other locations where statutory Tried on either the district or regional office, moti . During the year, 1,454 corpora- pating custodians) to assure com- full-time conference staffs are not Matultad pliance with the law. Designation of the taxpayer can, in most cases, tions having control of 36,000'sub- maintained . These offices consider file an appeal with the Tax Court. sidiaries were identified as having an organization as a participant issues relating to all internal reve- permits it to certify its compliance Even though this is done, and the the characteristics for coverage un- nue taxes except those on alcohol, case is docketed for trial, the tax- der the program . At year-end, ex- with the law . tobacco, firearms, narcotics, and payer may still reach a basis of aminations of approximately half . . Due to change in the law in wagering . They consider issues 1969, audit activity will be ex- settlement with the regional ap . of the taxpayers identified were in which range from the most ele- pellate office . As an alternative to process . This program is being ex- panded to include monitoring the mentary to the most complex and reporting and recordkeeping re- trial in the Tax Court the taxpayer decided in the Tax Court and 367 Appellate Receipts panded to cover a number of in- involve proposed liabilities which can take his case to the Court of cases decided in district courts and Disposals dividuals with widely disbursed quirements of broker-dealer organi- range from a few to many millions Claims or a United States district zations who are not participating and the Court of Claims. holdings and complex transactions . of dollars. Although there are dif- court, but this requires payment of About half of the cases closed Case receipts in appellate divi . firms . ferences in the authority and juris- sion offices have been quite even 1,462 Forms the proposed tax deficiency, fol- by agreement were at the district Art Panel Assists During fiscal 1970, diction of the district and regional lowed by the filing of a claim for over the past 3 years-33,213, 3780, Interest Equalization Quar- level and half at the regional level . 33,103, and in Art Evaluatio n offices, both have the same ob- refund, denial of the claim and suit District conference staffs obtained 33,099. Total dis- terly Tax Returns, were examined Jective--to effect an early dispo- against the Government posals for 1970 were down slightly A 10-man panel of art experts by district audit divisions . These . agreements in about 65 percent was established in 1968 to help the sition of each case . For 1970, the appeals function of the cases they closed . District over the prior year, due principally examinations resulted in recom- disposed of 52,324 cases by to a smaller work force, but aver . Service determine whether realistic mendations for assessment of $4 .0 conference activity is set forth in fair market value appraisals have Early Informal agreement compared to 946 cases the following table : age disposals per appellate con . million in additional tax and penal- Hearings Provided feree remained at the high level of been placed on donated works of ties. prior years . Inventory was up 5 art and art objects valued for estate The appeals procedure may be District conference mse work-load percent over the prior year, but re- tax purposes . characterized as one of informality mained in current condition . During this second year of activ- . It is designed to :nd accessibility Item Fiel d oft. T .t.1 The major portion (over 80 per . ity the panel reviewed 596 works Appeals System Provided chieve disposition of contested and it audit of art valued for tax purposes at cases with minimum inconven . cent) of the appellate workload for Taxpayers Cases pending July.. ------_------____ consists of nondocketed cases . $14 million . Recommendations by 8,848 3 .066 11,91 4 ience, expense, and delay to the Case ace,e-d,,,,,,d:: : --- : : : : : ------_------23 93 7 16 451 40 38 8 the panel included a reduction in taxpayer . District and regional of------24 :611 15 :650 40 :21 1 Taxpayer Has Opportunity N..b., g,e.d . . . . . ------14.906 11,207 52 26,116 15 value claimed on works of art from 'fices offer conferences within a Ce Ag d as a pencimt sf total ...... 6 1 $9 .5 million to $5 .7 million and an For Independent ns pending June 30 ...... ------8,174 3,917 12,091 increase in value on estate art ob- Administrative Revie w jects from $4 .5 million to $8 .3 mil- In the examination of about 21/2 million tax returns each year it is inevitable that some taxpayers will

28 / Annual Report / Chapter Three Enforcement Activities / 29 have increased the tendency of must make every reasonable effort segment of the tax filing public to Delinquent Filers Detected Taxpayer These are cases in which taxpayers some employers to "borrow" with. to collect these taxes . The first expect the Service to take fair en- Delinquent Accounts have elected to try to settle their forcement actions to bring these held or employment taxes as work- Although the vast majority of steps involve sending notices to Millions of Dollars tax disputes with the Service ing capital . The use of these taxpayers fulfill their filing obliga . . In taxpayers requesting payment . If delinquent taxpayers into the rather than go direct to court timely taxpaying fold . monies as working capital is a mis- tions timely and voluntarily, there percent of these cases the taxpayer does n t comply, de- 1970, 82 appropriation of funds that belong are those who do not . Since the agreement with the linquent accounts are0 established were closed by to the Government . For some time, strength of a self-assessment sys . and assigned to enforcement Increase in Delinquent 3,31 4 taxpayer. Agreement on cases of the Service has given attention to tem rests largely on the faith the 3 .310 82 percent personnel . Accounts Closed this kind have ave ra ged these delinquent taxpayers by ac . taxpayer has in the Government's over the past 5 years . The Service'disposed of 2 .6 mil- celerating enforcement actions in policy of fair and equal treatment 21808 Taxpayers filed peiitions for Delinquent Accounts Grow lion delinquent accounts in 1970 . getting these accounts satisfied for all, every reasonable effort is hearings before the Tax Court in This was an increase of 275,000 with dispatch . The 6-percent in- made to detect delinquent filers Over 2 .6 million delinquent ac- 6,968 cases in 1970 . However, accounts or 12 percent, over 1969 terest rate provided by the Internal L.461J counts were established in 1970, and enforce collection of tax settlement negotiations on these disposals . In addition, the dollar Revenue Code is low compared some 140,000 and 6 percent monies due. Particularly before the docketed cases continue and most value of taxes collected rose to with the going rate of commercial higher than last year . Reflecting advent of the computer, searching are ultimately settled . For 1970, $3 .3 billion, a jump of $846 mil- loans and may have hindered en . this increase, the amount of delin- out those who are delinquent filers 79 percent of all docketed case 1 .81 2 $506 mil- lion over 1969 . These accomplish- forcement success. Congress rec- has been a painstaking and time by agree- quent tax involved rose disposals were closed ments took place despite con- ognized this problem and provided consuming task. In recent years, -1,786 F 7 lion, or 18 percent, to $3 .3 billion ment without a legal trial . tinued budgetary limitations, which a penalty in the Tax Reform Act of and especially so in in 1970. It is reasonable to expect 1970, enforce- The following table shows the caused a variety of serious opera- 1969, for failure to pay taxes when some increase in delinquent ac- ment efforts directed towards cop- processing of both nonclocketed tional problems during the year . due . ing with the delinquent filer have 1969 and counts, if only because of popula- and docketed cases in been aided by increasing use of the tion and filing growthsu . it is equally 1970 . (For additional information automatic data processing system . reasonable for the f Ily compliant Inventory Kept Relatively Stable see tables 16 and 17, page 131 .) Enforcement efforts kept the in . Number of Offers Delinquent Return ventory of delinquent accounts at in Compromise processing of all cases for 1969-1970 (Income, estate, gift, Assessments Appellate Divislo,n 788,000 valued at $1,812 million, Disposals Decrease excise, employment, and offers-lif-compriamise ) 10,000 accounts and $26 million Highest in History. U Ll LLJ L iginer than the 1969 level . An un- The numbers of offers in com- The rise in delih4uent account F.1affifidned Classed Invest. " Number . 1 falls 30 Statu s IexpectedlyT large number of delin- promise cases processed during workload prevented the same level 1969 quent accounts were issued in the the year decreased by 2,446 of personnel deployment as last last month of the year. cases, or 18 .4 percent from last year to delinquent returns activi- 31 264 year . Total liabilities involved an ties. Nevertheless, there was still ...... 3T, 10 3 33:m assessed at $311 .2 million were RP=JUly_1...... ------___ . . .------...... -. .------_-_.. . .. increase of $31 .3 million or 38 .2 a significant dollar return com . secured through various estab . 32,340 -,U :M Nation's Economy Impacts Disposed .of,... total. . . ~ ------percent. on Tax Collection pared to .the manpower invested . lished delinquent returns pro ...... 26,21 3 mrm The following table provides a By .fffsene.nt...... ----. The Service secured 738,000 de . grams . The balance was secured Uri.g-d favor...... it, I arms, -W r.m Changes in the economy, par . ; li :,V35D 1 summary of compromise cases linquent returns valued at $370 through the Service's returns ex- -dismissal i;w ticuiarly when adverse, have a di- compromise f#!Wioa')------W.- a, -by -f" -C~ closed in the last 2 years: million . A total of 671,000 return s amination program . R petition to the To, Court ------2'578240 72 so" o rect impact on the collection of Tried 1. the Tax Court ------ly taxpayer default on statutory "at . This year, inflation pres- 32.027 UA4 5 taxes due Pending June 30.. ------Offers in compromise disposal sures and higher interest rates s

Numbe r Amount (thou- it diAl ..)

Type of tax or penalty Liabilities off .. 1969

1969 1969 Taxpayer delinquent accounts Sorne Taxfilers Fail to Pa y Offers accepted, total------_------...... 9.64 9 ~1.2U 20 .691 6.91 5 Number (thousands) Amount (thousand dollars) 3160 ...... Not every taxpayer pays the full Income estate, and gift taxes...... -__. . . . ------. . . 455 1343:972 E Iment nd withholding t ...... 22AM 4 925 ~2= amount of tax reported due when status 377 .1164 's,1 3 3.m 1 :48 Ziaci K9 = 1969 A= to ------65 se Other excise leads- .----- _ ------_------...... ------_ ------_ 1,. filing his return . Others make 59 AS 919 Delinquencyf" flea on .11 .a es ------4 105 errors on their returns, often re . Spec! pmiffens .1 ...... ------205 1,412 228' Issued. . . ------2,494 2,809.494 7 go SAU 91 tax suiting in additional tax due . Still offers rejected or withdrawn, total ...... ------_ ...... Disposed, total .- ...... 2,31 5 little 2,464,717 3,04 4 aus 64,294 UA@2 9,313 'U ;W others are found to owe money noff1hf By type Of action : 2AWW 'E pfovir*e'~'aletica I ------_----- 45,20 2s=~m; after an audit is made of their tax 1,962 2;w 1,3765 947 IS"5 8 3 51 1. 1 :7 Ullected- 3: 304 sa~gdtt Alcoholn. t ...... ----- returns . In each case, the Service Adrfitialalo;wwt~~ ; ------2=1711, Other ..fee tas es...... _ ---- . . . . . 298 Jet, 25 3 0 ------3W 525,466 9,938 a.ass 410 Other disposal, I ------Unit.. . cy penalties on .11 to-es ------...... ~a s Speaffic penalr e 604 ~at 125 Pending Jc,. 30, testal_ -----_-----_-- - 778 1,786,053 AIU21 M ...... I

1970 , Rervised . atI Include, disparsal.chn, to up,all.tibility, .1mr-oul and duplicate asesseargirts,inel for fiscal Y93T . huct des Pay ...t Tracer and Adiustment cas- Note : Appraised values of specific penalties are not included in the liabilities . R.,i=s

Enforcement Activities 31 30 / Annual Report / Chapter Three and the initiation of approximately Examples of the many taxpayers Three Automatic Data ters to taxpayers at any time during fined its program into two broad A former bank official failed to the year, thereby enabling a prompt categories-the general program 10,000 investigations each year . indicted or convicted in 1970 as a report "payoffs" that he received Processing File s These investigations include sus- Trigger Delinquency Leads follow-up personal contact when and the special enforcement pro- result of criminal tax investigations in currency for extending bank necessary . gram . The general program con- pected income and excise tax follow: credit to merchants and their cus . Three automatic data processing sists of the investigation of tax law evasion, failure to file returns, false A Federal grand jury returned an tomers . After his conviction on files, the Business Master File Computer Programs violations committed by so-called withholding exemption statements indictment of the operator of a tax three counts of attempting to evade (BMF), the Individual Master File Yield Good Results "white-collar violbtors." The spe- (W-4), false claims for refunds, service for more than 50 counts of tax on the income from this (IMF) and the Exempt Organization . program covered false estimated tax credits, perjury, willfully aiding and assisting in the 50 percent of al l cial enforcement source, the court sentenced him to Master File (EOMF), are today at Approximately in Chapter 4 includes participation failure to remit trust funds col- preparation of false and fraudulent apparent nonfiler cases, regardless serve a prison term of 3 years and the heart of a large portion of the in the Department of Justice's lected, and evasion of wagering income tax returns for a 3-year fined him $10,000 . Service's delinquent returns activi- of program, are res.olved through taxes . . drive on organized crime, strike period. Under the law the ultimate A former president of a com- ties . Because tax regulations and computer generated issuances forces, and the investigation of tax Historically, the Service has responsibility for the tax deficien- Clerical savings in these ADP oper- mercial college was sentenced to filing periods vary, each file works law violations by racketeers . played an important role in com- cies in these cases rests with the pay a fine of $40,000 and received differently to check for delinquent ations justify the Service's objec- bating organized crime with the persons for whom the returns were tive of complete automatic data a suspended 4-year prison term as taxpayers. The aim and result, convictions for tax evasion of many prepared . the result of a nolo contendere plea however, are the same-to trigger processing control and mainte- Effective Use of Manpower powerful and notorious racketeers . A former magistrate and probate nance for all delinquent returns to charges that he attempted to a delinquency notice or investiga- In view of limited special agent In the past year it has stepped up judge was sentenced to serve 2 evade his income tax. The charges tion in any apparent nonfiler programs . manpower great emphasis is its enforcement of the tax laws years in prison and pay a $4,000 centered around income to the col- situation . placed on careful selection of cases with respect to racketeers, result . fine for income tax evasion . lege which was diverted to his use . The BMF, which contains filing Leads Developed With to ensure that critical manpower ing in an increased number of the The court sentenced a tax return Other Government Agencies Unreported corporate and per . requirements for several classes of resources are aimed at detection of nation's currently prominent rack- preparer to serve 1 year and a day sonal income amounted to over business taxes, is programmed to Another side of delinquent re- potential fraud situations and to eteers being investigated for pos- upon conviction of charges that he $180,000 . deliver notice of a need for a single turns activities concerns probing achieve maximum level of deter- sible tax violations. prepared false returns for others, As an outgrowth of an income investigation at any time during for those soft spots, or compliance rence to tax evasion by investiga- While the Internal Revenue Serv. claiming false deductions and tax investigation, an engineering the tax year for any delinquent filer gaps, which may arise in particular tion and prosecution of those cases ice seeks to avoid surrounding the exemptions . The wife of the return consulting firm was fined $2,500 with one or more periods of delin . tax return program areas . Apart which would have the greatest im- filing of tax returns with an aura of preparer, who also participated in . This eliminates massive for making an illegal political cam . quency from its own sources of leads, the pact upon compliance attitudes of fearfulness, the would-be tax the tax return preparing practice, paign contribution . Sentence was paper work and clerical processing, Service has liaison with various the taxpaying public . evader, pondering his decision be- was sentenced to serve a prison . imposed after the court noted that as well as enforcement contacts Federal and State agencies . Mari- To deal with the relatively few tween filing a true and correct re- term of 4 months and a probation the company directors admitted since the computer will not issue huana and Wagering Taxes, Federal taxpayers who willfully try to take turn, no return, or a false or fraudu . period of 5 years on the same that the contribution was charged any other investigation until the Unemployment Taxes (FUTA), advantage of their fellow citizens, lent return, should be well aware charges. returns for all periods of delin- off as a business expense in tax Federal Highway Use Taxes, fed- Congress has provided criminal that his ultimate detection and In a 5-week trial, three promi . returns . Similar illegal political quency have been filed . The proce- erally funded programs requiring and civil sanctions. These sanc- apprehension will be publicized- nent state officials were convicted contributions cases resulted in dure applies even to delinquencies withholding and Federal Income tions represent the cornerstone of in addition to the prospect of a of Hobbs Act (Extortion) .violations fines up to $50,000 which may arise while the case is against two Contributions Act Taxes (FICA), are our self-assessment system . They criminal indictment, an arrest, a and were sentenced to prison for shipping companies, an advertis. outstanding . The program is so some of the areas covered by these constitute assurance to the honest trial, a fine, imprisonment, or a terms ranging up to 8 years and ing company, a savings and loan successful that additional business liaison efforts . Other agreements, taxpayer and deterrent warning to period of probation . fines up to $20,000 . The extortion association, and a wholesale liquor type returns will be added to the geared both to manual and com- the potential tax fraud perpetrator. schemes were revealed during the dealer . BMF control, maintenance and puter processing operations, are in If it is well known that violators will course of an income tax investiga . A numbers lottery operator was delinquency check routines next various stages of negotiation. not escape punishment for flouting Tax Fraud Not Limited to tion of one of the convicted men sentenced to a prison term of 21/2 yea r. the laws enacted for everyone, self- Particular Social Groups who was also indicted by the same to 3 years and a fine of $1,000 in The IMF operation, on the other compliance is more acceptable . The grand jury for evasion of his and a state court for conspiracy to vio . hand, produces but one delin- Tax Fraud Investigations results of the work of mspeclal his corporations' income taxes. quency check annually for nonfil- The incidence of tax fraud is not late the state's anti-gambling laws . Promote Complianc e agents are not measured by the confined to any occupational,g geo. A retail furniture dealer was This conviction, and that of 18 ing since only Form 1040, Indi- number of criminal cases investi- graphical, or social found guilty of willfully making and vidual Income Tax Return, is p. Cases other conspirators, was based on The intelligence mission of the gated or prosecutions recom- investigated by the Servicerou during subscribing income tax returns, testimony of special agents of the involved . The program can identify mended . Of paramount importance the year have covered a wide range under the penalties of perjury, Intelligence Division and evidence cases needed by an individual dis- service is to identify serious areas of noncompliance ; select for in- is the increase in voluntary compli- of subjects by occupation, geog- which he did not believe to be true seized by them during wagering trict office, thereby adding value vestigation those cases that will ance bythetaxpaying public result- raPhy, and economic or social and correct as to every material raids . When Federal indictments to this computer operation since create the broadest degree of deter- ing from the impact of these status as well as by types of tax matter. The taxpayer omitted from charging conspiracy to evade and management can use it as a tool investigations and subsequent suc- or by his returns substantially all special in deploying manpower. rent ; investigate assigned cases method of evasion . defeat wagering occupation and expeditiously and thoroughly; and cessful prosecution of violators. The fact that convictions of order customer sales . He was sen- excise taxes were dismissed on the While the Exempt Organization tenced to 3 years probation . Master File is still in early develop- obtain maximum publicity of pros- people involved in 170 separate basis of the Supreme Court deci- ment, it has adopted more sophis- ecutive actions Careful Evaluation of Cases occu pations were secured indicates sions in the Marchetti and Grosso To effectively- carry out this role, the extent of the Service's efforts cases, the county prosecutor ticated techniques for delinquency the Intelligence Division has rede- Enforcement of the criminal ta x to maintain a balanced coverage of check purposes . The principal adopted the evidence and success . statutes is accomplished through the entire spectrum of the taxpay . fully prosecuted the state charges . benefit here is in the computer's the evaluation of more than ing public . capacity to issue delinquency let- 100,000 allegations of tax fraud

32 / Annual Report / Chapter Three Enforcement Activities / 33 Tax Fraud Investigations capitalize on its greater speed in Intensified Investigations identifying criminal tax violations, Cases Involving Continue Type Elm evaluating potential fraud situa- Criminal Prosecution ' tions and supplying special agents The number of investigations in I r...ligature completed, total ------8, Z73 .1~m with the leads needed to more Total additional taxes and penal . process continued at a relatively ties of $87 Prosecution recommendations, total . . ------1.139 I .M effectively conduct tax investiga million were involved in high level with an increased hum- . cases received in the Chief Coun . Fraud. . ------___ ------_------,% .an tions . ber involving racketeers and or- WageringCrim...... I ...... 33 sel's Office with recommendations Moh.toperated...... gaming...... device. . __...... ;a ganized crime drive subjects . Tax 5a3 AS of criminal prosecution . This was a investigations of racketeers require Referrals to the decrease of $9 million under the Investigation, in macess, June 30 ------7,513 Department substantially more manpower than of Justice amount involved in the prior year . other tax investigations so the in- A total of 880 income and mis, ~n analysis of criminal tax cases creased emphasis in this area moderators and workshop discus- The study showed a marked in- cellaneous criminal cases, with of all types (other than wagering caused a decline in the number of sion leaders at regional confer- crease in the amount of income re- prosecution recommendations in and occupational tax cases) re- ported in subsequent years' . investigations completed . Never- ences sponsored by the Law volving 877 prospective defend . ferred to the Department of Justice theless, the number of prosecution Enforcement Assistance Adminis- returns. ants, were forwarded to the follows : recommendations for tax fraud tration for police officials and New techniques have been found Department of Justice . In .1970, remained approximately the same prosecutors . for identification of frauds perpe- indictments in such cases were up Receipt and disposal of criminal cases In as in the prior year and the amount The Intelligence Division also trated by multiple filers of claims 41 .2 Percent . There was no signifi . Chief Counsel's Officer of taxes and penalties recom- maintains liaison with other ad- for refund and by unscrupulous tax cant change in the volume of re- ministrative agencies and with practitioners. Electronic data proc- status mended for assessment in in . ferrals to the Department of Justice 1969 F= 1970 Congressional committees con- essing equipment is being applied vestigations completed in or in the total disposal of cases in Pending July I ...... increased by more than 50 percent. cerned with legislation relating to to available intelligence data to the district courts over the prior 2,148 ROctived, total. . . . . --- The number of special agents on taxes and enforcement of tax laws . facilitate the collating and analysis year . 1 . Us USAi r the rolis was increased by about Studies were made and information of vast amounts of information in With recommendations lot phosecution ...... In income, excise, and wagering With request, Im ibirion at 1 .01 9 Usn" 200 by the end of the fiscal year . was presented in testimony before place of time consuming investi- tax criminal cases 448 defendants 65 Disposed of, tatal ...... Much of the new employees' time Congressional committees consid- gative procedures formerly used . pleaded guilty or nolo Contendere, so ering legislative proposals relating A new and improved system for Prosecution not warrant",-,,, was devoted to intensive classroom 73 were convicted after trial, 30 Department 127 to secret foreign bank accounts, gathering, evaluating, and using Of Justice coot _------...... and on-the-job training which is were acquitted, and Prosecution 77 were A M domestic banking and financial intelligence data relating to tax- OF,inions delivered ...... -1 ...... tailored to meet the unique needs dismissed . other losings_, ...... institution record keeping and re- payers engaged in illegal activities, . 171 of the special agent in his detection A comparison of indictments and Pending June 30 ...... 2,073 and investigation of criminal tax porting, regulation of credit report- is being formulated . The proposed court actions for the last 2 years EIE:J ing agencies, and wagering tax en- new Intelligence Gathering and offenses . follows : oLincludes, cases Swatting action in Department of forcement . I nvestigations were con- Retrieval System is designed for liters. Di0simi. JuStIcit elctusive of wagering tax uses referred by Law Enforcement Training ducted in cooperation with military Service-wide use and conversion to and Research investigators and the Senate Per- the automatic data processing sys- Results of criminal action In tax fraud case s manent Subcommittee on Investi- tem . Implementation will permit Part of the Service's training gation, concerning alleged tax expeditious retrieval and dissemi- program for special agents is being Number of fraud in military club systems and nation of information throughout Action defendants made available to State and local illegal currency manipulations in the nation to meet the problem pre- law enforcement officers under an South Viet Nam . sented by the mobility of today's 1969 agreement between the Secretary Several projects were initiated racketeers . of Treasury and the Attorney Gen- Total during the year to measure the A new compliance concept was Indictments and Int .-firml 1 eral . It provides training to officers deterrent effect of fraud investiga- tested bythe Intelligence and Audit Disposals, total ------selected by the Law Enforcement 649825 tions; to find new ways to use data personnel in one district in each of Pin, guilty or not. contend.. . Assistance Administration of the Convicted attar trial------470 processing equipment as an- in- the seven regions this year. The Acquitted .. : ------* ------91 Department of Justice, which was ------: : : 20 vestigative aid ; and to formulate project was directed toward deter- Nol-Prossed or dismissed I ...... ------24 4 created by the "Omnibus Crime better methods and means of mining compliance conditions in Income and miscell.mm, cases x ------Control and Safe Streets Act of gathering, storing, and retrieving the districts and identifying com- I ndictments and inte-tiams 1968 ." Forty law enforcement offi- Disposals, total ...... ------631 information . pliance gaps, enforcement weak------I ...... 626 cers from outside the Internal To measure the deterrent effect nesses, and developing remedial Pie., guilty or noto contendene Revenue Service have successfully Convicted after trial------: :------...... 441'9 40as, of investigations, taxable income measures. Acquittedof -~ ------...... completed the training and are now reported in returns filed after in- Studies are continuing on the No ~Prosseworillsm, Or ------2 5 better equipped to make use of 11a, a vestigation in 188 selected cases capability of automatic data proc- Wagering tax uses financial records in pursuit of their was compared with that reported by essing to assist in criminal tax Indictments and firlonim,thm------, __ ------investigations. Disposals, total . . . ------18 1`3 the same taxpayer in returns filed enforcement work. As additional 29 Special agents with expertise in for years prior to the investigation . information becomes available Plea . guilty or nolD contendere investigative techniques in criminal Convicted after trial ------: : ------...... __ --- L9239 through increased use of elec- Acquitted ------121 5 tax investigation served as panel Nril-Prossed or dismissed . . ------tronic equipment in the next I ------...... 163 decade, the Service expects to I Includes cases dismissed for the fallowing reasons : 19 because of death of b-hse of serious illness, and 23 because Whillml defendant had pleaded guiltyprincipal cheamilift . 8 in a related case . or had base convicted to'seaIncludes. income, estate, lift, and 0-11- taxes Other than wagering, alcohol, tube-, and fhmhm ,

34 / Annual Report / Chapter Three Enforcement Activities / 35 Workflow in the Service Workflow in the Internal Revenue Service and the courts, fiscal years Additional detail on legal work- Results from ING! the Courts and 197 0 1969 load involved in the prosecution of Direct Enforcement by Service attorneys criminal cases Million of Dollars The following tables provide in- during the past 2 years is provided formation on work processed by in the following table : the Service for years 1969 and Returns 1970 . The major portion of the 2,517 Tax returns filed, total ...... _ ...... 110,658 Tax and penalty and number of tax years Involved in criminal fraud casedisposals workload results directly from the .63 3 ms. am ass I ndividu .1 income ..._ ...... returns filed involving income, 76 215 414 of wafering and ceir-up too timing cars . cmur'l "O"I'mratiril modure., ------...... : : : : 1 :729 : 80 8 ~Mnhf (Exclusive estate and gift taxes . The time re- Estate and gift ...... 2,299 Employment ...... 274 280 =3 SST quired to process a return depends ...... - 22,032:475 = M : a . To . years Tax and penalty E.,.. . ------other .uncermi...... 1 650 216 2. Sn . 2g, Disposition on the complexity of the items and ...... 8:756~440 196 9 1969 the issues involved . Many returns are processed in a short period INCOME, ESTATE. AND GIFT TAXES ...... ~, 902 ~Lgrg ;126,230,68 8 while others require work by dif. Number of .turn . examined (includes for., 990) ...... 713675 2 .~M 64 683 413 32 .~=Xn ferent activities and are not closed Returns with adjustments proposed . . . . . 2,414,266 2,ing, as P-as fish, ...... 2 by audit divisions ...... 1.685,41 0 SjuldLIM, ,an fil : 547 :275 Z '.i 9; ;134 isPoSgerseAsTurvefimxrar~xdit of ,by aclaims audifto.0 alipe divisions it : Ail otheU closings I ------during the year of filing. it it defaultod___ ...... 1,374.231 1 .14cus The unit of measurement at the 258 ;ti ------...... 51 B SRL lu I Includes man declined by Department of Justice...... : us audit level is on a return basis while Other . . ------...... I ------':'1'3! S" beyond that level it is on a case basis . A case may involve one or Civil .'as cases Additional Taxes from Examination of tax returns in more returns and more than one taxpayer and may include returns Total received in appellate divisio n 25,110 Direct Enforcemen t 1970 resulted in additional assess- 507 .0 Disposed ot by appellate ------.. . 21 .924 which span a number of years. Courts of origins jurisdiction : Most taxpayers voluntarily file ments of tax, penalties and interest Tax court : $2,299.2 million . 370 . 1 Total petitioned to Tax Cour t tax returns and pay their liabilities amounting to Dismissed------272 Settled by stipulation ------: : * ---- 4 . 7776 $370.1 million in delinquent re, Settled br~ To, Court decision auts ~ith no enforcement work required ...... I ------93 m turns were secured during the year . Decided y Tax Court. but appealed . . . . . - ...... 22 5 However, a balanced enforcement District courts and Court of Claims . m The following table shows compara, : program covering all classes of Total filed in district courts and Court of Claims ...... 1 .246 Jus tive data for the past 2 years: Fr,mideded Transfer Delinquent M-th Settled in district court, and Court of Claims ...... 1,073 IV ecided by district courts and Court of Claims ...... 47 1 taxpayers is necessary to promote exame driliesdamt do- sedificar"lead ...... all . ticcounts Secured Courr's of Appeals : compliance by colhictiod Settled by courts of appeals decision ...... 349 An Favorable to Government ...... 233 2111 Favorable to taxpayers. - . --_------. . . . 66 Modified...... 50 by courts of appeals but reviewed by '~Winit'Cmdrt . . . 5 12 SupremeDecided Court : Settled by Supr Court decision ...... Gross tax, penalties, and interest resulting from direct enforcement Fraud a., r lin thousands .1 dollars] Received lot full-scale investigation in intelligence divisions Sal Disposed of by intelligence divisions : 1959 P.-tuin ox,ohnnuandin ! 049 Disp Prosecution not m , ------1:031 L.Sas deadprosecution *1 by 0111, net vm~r0 llistn Counsel : l,M 222 Additional tax, penalties, and ithroured, to"L ------3.368,338 - led. I.[-u. itirg , . ce,. as declined by the Department prosof Justice------...... 227 8 Z20~= actilicunt...... From examimitirm of is, returns. total _------2,383,06 712 ~LIV~we income tax, total . .. ------1,976,078 i Includesp cx,!,d I as ce.. . . .'por .thm . ._ ------1,212,319 UIU,- .rually estimated C 9 sen;garr Individual and fiduciary ...... ------763, 75 07XX Estate and gift tax ------ij ------___ ---- 319,594 ...... -- 46 826 -U," Employment tax (including w1fifis income tax), ...... 45"57 0 Excil. tair. . . ------. . . . From ms~hematic3l verification of income us return - '36111:1021 Sm.so From verification of actirested to. payment- 11-imerd_` ------~ ...... 09 &MAN .075 Mi6Ml From afixfirstutint return, secured, brief ------309 ...... 252 599 sal By dt"firistd coll Iran division,------56:435 By istrict auditT diii,firic .. ._ ------Ak~m s 296,962 Claims disallowed, total,___ ------I...... I117 21L no By district aeudit ivilitial ------.. By reports reliefs divisions. ..------. . . . OUR 2. Delinquent taxes, collected, total. . . . . 1,939,251

Chapter Three Enforcement Activities 37 36 / Annual Report / Amounts of revenue involved at each level of the tax system, fiscal years 1969 A 5-week survey utilizing "Satu- Illicit distillery seizures for fiscal and 1970 ration Raiding" was conducted in year 1970 totaled 3,763, a gain of latilliom, of dollarsi certain counties of seven States in 700 over last year's figure of the Southeast Region during the 3,063 . A slight but . continuing Item 196 9 early spring of 1970, resulting in downward trend in seizures of the seizure of 1,611 illicit distil- mash and untaxpaid distilled Internal I-A. . collections, tolel_ _ _------,187,920 ~=,,M leries and 6,427 gi~llons of nontax- spirits in 1970 could conceivably lirdi,idul I .. .. taxes. bit-L ------_ ...... _ _ ~97, 440 ZZ paid distilled spirits . "Saturation reflect marketing difficulties for Withholding ...... _ ------_------,70,182 au Raiding" is a technique involving illegal liquor, particularly in areas other...... _ ...... 27,258 the concentration of manpower in where local economic conditions Curtis, tion I . . . . taxes------38.338 3$JW have improved, and where inten- Estate and gilt - - .. . ------3 ;M "search and destroy operations" Employment t... il~ ...... ------h ON .1171449 designed to measure the extent of sive public relations campaigns on [.,I,. test, . . . _.. . _ --_------15.543 uAles the illicit liquor problems rather the dangers of poison moonshine INCOME, ESTATE, AND GIFT TAXE S than apprehend distillery opera- have been conducted . More de . tors. As a result, this operation tailed accomplishments in liquor Civil uhus brought the number of distilleries law enforcement for 1970 in com-

Additional Us and penalties I, caus, disposed of I. audit di,Liiiarri by "' re. seized to a higher level than would parison with 1969 are shown in the adment,diummil poymanr~dor detaulL ...... 1,328 two tables below . Us ir Penalties in uses disposed of .in.. appellate. . . divisions by normally have been the case con- 361 103 sidering the manpower expended . AdditionY"'m e.] antiis P noat'penalties or dolau determinedIt— by settlement i n 119 105 Additional tax and inumalthics determined by Tax Court decisions: Analysis of this survey indicates Dismissed. . 4 The production of Illicit whiskey was Decisions an. il------;i' ------23 23 that, while substantial inroads Seizures and arrests for alcohol and tobacco violation s reduced by 49 gallons per day In the Additional tax and .I'nettlesI;iW1;i .1 Court and courts of Birmingham, Ala ID as have been made towards eliminat- . me when this still was . ------* ------47 ing major violations of the Internal seized In an a bandroarsaid cost hilis . In Amount-pp as...run. .. item 1969 northern Jitiffiension County. Th. two Fraud us., Revenue liquor laws, a tremendous F-ins' Agents and :no State Agent amount of work remains to be San .,.: pictured aided I is th seizure. D"encia and penalties in cases disposed of in intelligence divisions : D ulffleries . ------nurnbil- 1,9643,063 gosecution recommorded . . . 83 done . Still, at distilleries 4, 362 Posecution not~"i_ warranted and uses K 1~ed ~; i ii iiii e . . 20 Non"U .peid distilled------pkili__ ------...... __ ------An__ 92,281 Me$ ...... 972 Vehicles...... - ...... - ...... number-- 1,092 ~ Includes . .is. Us,, . Property (apingived _ ------___ dollarsu 11346 276 Arrests------...... ; be,- 4:137

Manpower Utilization Chemical Analysis Supporting Results of criminal action In alcohol and tobacco cases (Federal courts) Law Enforcemen t -Fiscal Year 1970 Number of delandarts, Actio n The National Office Laboratory E9 is engaged in the analysis of physi- Liquor Law Enforcement at 1200 cal evidence connected with illicit Indictment, and information ------_------_ Reduced Level s 2,27 0 am n distilled spirits seizures, firearms The Alcohol, Tobacco and Fire- Disposals, hitel_ ------...... 2,57 1 ZAU violations, destructive device con . arms Division of the Service en- Plea. guilty or nolo contenders trol, tax depletion allowances, or- Convicted error trial ...... _: : : :...... ""'374 1 forces the Federal laws pertaining amounted ------_---...... ------...... _ ...... ganized crime investigations, docu- to illegal activities involving liquor, Nol-Prossed or dismisse d 112316 ment examinations from intelli- tobacco and firearms . Due to the gence cases, and specialized ex . passage of the Gun Control Act of amination for State and local gov. 1968 and the resultant manpower ernments and Federal agencies . requirement to implement that The traffic in illicit liquor re- tinued priority emphasis on this This fiscal year, 560 cases in. law it was necessary in 1970, as mains centered in the southeastern program . volving 5,300 specimens were well as in 1969, to divert man- portion of the United States, ac . A substantial increase in rev- examined . This compares with 390 power from other programs, mainly counting for over 90 percent of the enue has accrued to the States as cases involving 2,700 specimens from the illicit liquor program . This illicit distillery seizures in the Na. well as to the Federal Government examined in the prior fiscal year. was necessary even with the staff- tion . "Operation Dry-Up," a tech. in the three States directly affected In research and development, ing increases provided for the fire- nique employing a heavy concen. by "Operation Dry-Up ." Since its manpower was devoted to the de. arms program . tration of, investigative officers in inception "Operation Dry-Up" has velopment of techniques for dating The following chart reflects the the principal problem areas, has produced more than $46 million in ballpoint, writing and felt tip inks. shifts in staffing between the prin- -bano Me, Jun gap D. Ma r Jun Sao D. Mar Jun proved to be extremely effective. additional revenue to the Federal Work in bomb residue detection cipal alcohol, tobacco and firearms 1967 1968 1968 1968 1968 1969 1969 1969 1969 1970 1970 While available manpower re- Government as a result of shifting was given high priority because of programs . sources have been spread thin in patterns in the consumption of its importance and the large num . current "Operation Dry-Up" target alcoholic beverages from illicit to ber of samples submitted for areas, progress made justified con- legal markets . examination .

38 / Annual Report / Chapter Three Enforcement Activities / 39 Alcoholic Beverage Advertising of tects the consumer. These controls Regulatory Changes Number of Cigarettes Taxed (1960-1970) Expansion and modernization Promote Efficiency Labeling and Trade Practice s the photographic laboratory was are applied principally through a completed to accommodate the in. system of permits and bonds, re- improved efficiency resulted The Service administers the creased workload . Approximately porting, requirements, and inspec- from several regulatory changes Federal Alcohol Administration Act 560 1,500 -prints per month were pre- tion programs . made during the year . One elimi- which is designed to protect the Although the number of distilled pared, involving photomicrographs, nated printing the bottle size on revenue, protect business competi . $4 0 pictures for the Commissioner's spirits plants remained fairly bottled-in-bond export strip stamps tors, and protect the consumer . Art Advisory Panel . and photo- stable during 1970, the volume of (Green) . This change extended to In executing responsibilities un- 520 graphs for training purposes. Al- activities requiring Government export stamps the earlier changes der this Act the Service examines most all divisions of the Service supervision has continued to in- made in strip stamps for spirits alcoholic beverage advertising of draw upon this activity for special crease . The following table reflects bottled for domestic consumption producers, bottlers, importers and 500 assistance . Statistics for fiscal year 1970 . (Red) wherein one standard stamp wholesalers for compliance with Alcohol and tobacco tax collec . Five scientific papers, based on is used for all bottles of 1/2 pint or requirements of law and regula- 480 original research, were published tions continued to climb, totaling more . The printing, accounting, and tion . Examinations are normally during the year. One paper on $6,8 billion in 1970 as compared stocking of one type stamp was made of advertising in a selected 460 document dating, based on ink to $6 .7 billion in 1969 . substituted for the printing, ac- group of general circulation news . analysis, attracted interest on the counting, and stocking of six types papers and magazines, trade pub. part of agents working on income of stamps. Another regulatory lications, and radio and television 44 0 tax fraud cases . change permitted distillers . to commercials. (in recent years un- determine the quantity of spirits der the voluntary codes of the 42 0 Continued increase in Volume of produced by means of a volumetric National Association of Broad . Regulated operations g uge in a tank, thereby eliminat- casters and the Distilled Spirits The Service is responsible for ing the need for costly installation 40 0 of tanks on weighing scales . Institute, radio and television have the regulation of the alcohol and not broadcast advertisements for tobacco industries . This regulation distilled spirits. ) 1960 61 62 63 64 65 helps assure compliance with vari- In 1970, the Service reviewed ous Federal requirements (includ- Administrative more than 18,000 issues of 70 ing proper taxpayment), prevents Dev elopments Relating publications which carry alcoholic diversion of nontax paid products beveragecom advertising, and 175 cate are now being put on microfilm Cigarettes and Small Cigars into illegal channels, and also pro. to Alcohol Industry red io mercials were also re- for easy retrieval, since approvals Until 1953 made in the past are checked for there was a steady Operation s viewed . Within the various media increase in cigarettes sold domes- our sample selections are changed precedent many times a day. After tically. From 1953 July 1, 1968, all labels were to be through 1963, from time to time . consumption increased about' 3 Industry Cautioned In addition to the review func- resubmitted by industry for re- percent per year except for 2 years About Use of tion, as a service to industry, the examination and to be microfilmed, in the early 1950's . There was a Food Additives The distilled spirits industry has alcohol and tobacco Industries fiscal year 1970 Service evaluated the acceptability decline in 1964 at the time of re- Production by complied and the labels have all . 917 .5 million tax gallons . The Alcohol, Tobacco and Fire . of 900 proposed advertising lease of the report of the Surgeon Distilled spirits ' ...... a rms Division enforces compliance themes or campaigns voluntarily b en completed. The wine and beer Rectified distilled :Sol rits...... 114.3 million proof gallons. General's Advisory Committee on ...... 305.8 million gallons . on food additives under the Food submitted prior to release . Some industriesa( have until July 1 1971, Smoking and Health, but this was Still wine. to resubmit their labels ior the Effervescent wines ...... 20 million gallons . and Drug Administration's (FDA) 263 conferences were held with followed by an increase which . Responsibilities to the industry members, their attorneys, same purpose. lasted until 1968 Vermouth and other...... regulations when the signif . natural wines...... 33 .5 million gallons. consumer require inspection for or advertising agents on proposed icant anti-smoking campaigns be . 134 .7 million barrels Beer ...... changes in food additive require- advertising. Offers-in-Compromise gan to affect domestic consumption Large cigars...... 6 .8 billion. ments, particularly those items Examination of labels, unlike of cigarettes . 863 million . Twenty-three cases were closed . Internal revenue tax Small cigars...... which hold only limited clearance advertising, is done prior to their upon the acceptance of offers-in- receipts from cigarettes have ap- Cigarettes ------511 .7 billion . from FDA. For instance, the indus- use . During the year, 71,BD4 compromise under the Federal Al- proached or exceeded $2 billion in 601256.3 million gallons removed from bonded storage after de ormination of taxes due . try was notified that brominated labels were examined, 71,225 ap- cohol Administration Act. Involved each year since 1962. 6 .8 million gallons removed tax free. 2,197 ., Iiinn gallons In'stonage in bonded a.- vegetable oil was removed from the Sales of small cigars (cigarette houses at the end of the year . proved and 497 rejected . Approval were such matters as the furnish- FDA's Generally Recognized As of these labels hinges on their ing or giving of equipment, serv- size) seem to gain when cigarettes ATF permissive Man-POWOr Use Safe List and was requested to acceptability under law and regu- ices, things of value to retailers, or experience down-trends . The in . identify any wine or liquor formula lation aimed at protecting the con . the extension of credit to retailers ; crease in small cigars in the do- 1969 . Subse- using this clouding agent sumer . The information on the label all practices contrary to law. The mesti,c market has undoubtedly quently, approval was withheld must enable the consumer to iden . purpose of the law is to keep been further stimulated by the use Plants and perinitteas subject I . IRS regulatory ventrol (exchides retail liquor on formulas which included this manufacturers or wholesalers from of a reconstituted tobacco wrapper dealax) : ,illZally ~ I tify the beverage, determine its On.sito impastions madii~ Z3, 400 material . influencing retailers to exclude (Paper made from tobacco), which M-Y.- , ------A . --...... _ 22, 216 quantity, and be truthful as to any 339 competing products . provides significant labor saving Minn-yern, s~ent an direet Plant ijl30iv1iWn: ------2112 Permits Issued, amended ad ------other information on the labels . All economies in manufacture cl.ion, .11--in-compromise and alsesurents revieved and 40,610 . Also, labels and their approving certifi- the internal revenue tax rate on

40 / Annual Report / Chapter Three Enforcement Activities / 41 Number of Cigars Taxed (1960-1970) Organized Crime Project Investigations Aid in WHO= Drive and Firearms Exposing Organized Crime MEDDUT Strike Force Operations Expand 90 0 Activities Four Foreign Bank Accounts Problem Studie d H E Firearms Law Enforcement Continues to Expan 70 0 d Gun Control Laws Effective Against Convicted Felons 11E

Sa o

40 0

30 0

200

100

1960 61 62 6 3 66 67 68 69 70

small cigars is 11/20 for a package the changes in composition of the More than 100 different ma- of 20, compared to 80 for ciga- alcoholic products, and an investi- terials are analyzed each year by rettes. But small cigars still con- gation of foreign substances in the national and regional labora- stitute only a minor part of the products which might be toxic . The tories. Among these are alcoholic smoking product market which is development of analytical profiles beverages, food products contain- dominated by cigarettes . on whiskies, wines, beers, and ing alcohol, flavors, toilet prepara- other alcoholic products is essen- tions, lubricants, and tobacco. Chemical Analyses Made for tiai in carrying out routine analyses This year a total of 27,531 indus- Regulatory Work and regulatory controls . Samples try samples were analyzed as com- from proposed industrial processes pared to last year's 19,736 . To provide scientific foundations are examined, and recommenda- The national and regional labo- with Internal Revenue Service man- tions based on technology and reg- ratories examined 4,043 formulas agement decisions and policies, the ulations are made . Samples from for specially denatured alcohol arti . National Laboratory is engaged in a the Bureau of Customs are ex- cles, 9,660 label approval re- number of activities . In the field of amined to determine classification, quests, and 1,783 formulas for consumer protection this include3 taxable status and compliance with nonbeverage foods, flavors, and the evaluation of containers made labeling requirements . internal medicinal products . from plastics, aluminum, coated Cooperating (through the Asso . metals, or ceramics used for pack- ciation of Official Analytical Chem- aging alcoholic beverages . The ists) with technical Societies, the evaluation includes an analysis of Laboratory helps to coordinate and maintain standard analytical meth- ods for all alcoholic beverages . Projects . are assigned for joint studies of methods and the devel- opment of new analytical ap- proaches to old as well as new problems.

4~_961 0 - 71 - 4 42 / Annual Report / Chapter Three The Service Fights Infiltration of Legitimate are deposited in foreign banks . aminations in progress by the Audit Organized Crime Busines s These deposits are later invested Division, 896 investigations being in the United States by using a pursued by the Intelligence Divi . The internal Revenue Service's Organized crime is constantly nominee to disguise the beneficial sion and 161 cases being worked participation in the war against striving to take over legitimate busi . owner . In reality, the lender ig also by the Alcohol, Tobacco and Fire . the lendee organized crime retains a position ness . Nominees are often used to . Often, false loans are arms Division as of the end of the of highest priority . Application of legally purchase a business and made to foreign entities who de. fiscal year . resources to the racketeer segment coercive sales techniques are often posit the borrowed funds in Swiss Tax investigations are time con. of the Service's overall program employed on a reluctant customer . banks for the credit of the party suming, especially those involving . Expertise Another method of takeover is making the loan . In these cases, racket figures and their associates. has steadily increased there is no intention of repayment attained in tax investigations of through the use of shylock or loan. . Customary business records are shark acfivities. Money is loaned at In addition to the tax fraud in . nonexistent, prospective witnesses racketeers over a long period of volved in evading tax on funds de time has enabled the Service to prohibitive interest rates to busi. . are uncooperative, obstructionist move immediately into any area nesses in financial difficulty and posited in foreign banks, this prac . tactics are the rule, and audit trails unable to borrow from legitimate tice breeds other fraudulent con . are carefully concealed . Unlike the singled out by the Department of spiracies. Justice for Strike Force activity . credit sources . Default on the pay- situation where the investigation is Strike Force energies are generally ments is followed by takeover of Sometimes, through cooperative contemporaneous with the crime, the company. foreign banks, the money finds its Federal tax cases require the agent concentrated on criminal combines way back to the real owner as an in specific geographical areas . Sole proprietorships or closely to dig out facts and evidence from held corporations are especially ostensible loan on which the owner cold leads. The actual crime may Because of the Service's particu- then Proceeds to claim interest de- lar interest in the tax affairs of all vulnerable to this tactic of orga . have'taken place several years be. nized crime. If the businessman is a ductions for tax. purposes while fore assignment of the investiga . racketeers, their enterprises, and by one or two agents oper- President Nixon sign, on -Utl.. old-, iheir so-called white-collar collab- tection creating the National council on habitual gambler and a big loser, each installment payment is cred . tion and, depending on the theory ating from a district office. Guid- O,g. .iz.d Crion, e - ..be. of the the racketeer's capability for steal- ited to his account with the foreign of proof, the agent may need to orators, it continually seeks to im- by. C01not end other government ffid.11 bank. ance and assistance is provided lock .. . ing the business is greatly an . trace back several years beyond prove its inte ligence gathering and National and regional offices which retention system,I an essential tool h-anced. Gambling debts accumu. Every effort is being made to the actual year of the tax fraud to remain current on the progress of eliminate those features of foreign for efficient and expeditious in- lated with a friendly bookie by the establish evidence . Despite the in- these investigations and alert to principal stockholder, corporate banking which can aid fraudulent herent problems, a number of key vestigation of tax fraud cases in- by levels of society. These segments volving top echelon racketeers problems being encountered president or whomever controls the activity on the part of Americans . Strike Force targets have been suc- agents . District office personnel in join together when it is safe and company, often result in the busi . The Government is approaching the cessfully prosecuted or are under whose personal activities are usu- profitable, separating when con- Problem from a ally cloaked in secrecy and often one section of the country are as- ness finding a strange, new "no . legislative stand- indictment for income tax evasion . sured of immediate assistance from venient . The leaders in organized show executive" on its payrol . The point as well as through interna . They include three top echelon extend beyond state and national crime are not provincial ; they en- tional treaties . The pieces of intelligence agents in other parts of the na- situation can progress to the' 1point . racketeer leaders and four top borders tion, whether it be a call for sur- tice, enlist and often compel the that surface periodically in scat- where the owner of the business lieutenants . The Service also has veillance, interrogation of wit- assistance of those required to finds that his services are no longer under scrutiny or investigation all tered areas are maintained in a nesses or general investigative serve their cause . In addition to the common depository where they can required or the owner may file false Strike Forces known members of numerous rack . activity. The sense of urgency, an pure racketeer type, organized and fraudulent corporate income eteering groups and their asso. be put together, evaluated, and crime is populated by larcenous The Strike Force concept, which made available to field forces for essential feature in any investiga- tax returns in an attempt to pay off ciates. Many prominent racketeers tion, does not fade by transfer of businessmen, corrupt public offi- melds the energies and expertise comprehensive investigation. the criminals with untaxed cor. have been investigated, indicted, investigative responsibility to dis- cials, unethical bankers and porate profits . of several Federal law enforcement and convicted for tax violations in tant corners of the nation . brokers, and unprincipled attor. authorities under direction of the the major areas of criminal activity. The Project Project investigations, due to neys and accountants, who portray Department of Justice, has ob . Millions of dollars in tax defi . their scope and intensity, have the role of reputable members of tained results in several major ciencies have been recommended Investigation Approac h . The strong-arm ele- Secret greatly broadened the Service's the community crime centers across the nation . for assessment in organized crime ments can expand freely without Foreign Bank The Project investigation ap knowledge concerning the realities Accounts Additional units are scheduled for cases . The Service has contributed proach is applied to significant of organized crime and have re- fear of disruption, cut themselves deployment to other areas of sig- leads and expertise, such as recon . racketeer cases traversing service sulted in assessment of a substan . in on sizable crooked transactions, nificant organized crime influence . struction of complicated financial receive the benefit of excellent For many years, individuals in organizational lines and relating to tial amount of additional tax . Un- and out of organized crime have The investigative arms of the transactions, which helped make it particular areas of evasion such as fortunately, a great segment of the business expertise including fi- Service are heavily committed to possible for other Federal agencies nancing, obtain secure investments used secret foreign bank accounts loansharking, untaxed gambling public equates organized crime to evade taxes . Racketeers find this this drive . It is believed that a well engaged in the drive on crime to profits, or deposits of untaxed only with a rather limited but no- and gain control of legitimate busi- organized and determined effort of obtain indictments for violations . nesses here and abroad . arrangement extremely beneficial. funds in Swiss or other secret for torious group of racketeers who Cash receipts derived from illegal the Service, advancing in concert outside of the Service's juris. eign bank accounts. rely upon the threat of violence to The Service has been acutely activities or from legitimate gam with other cooperating enforce- diction . . the aware of this criminal coalition and . The scope and depth of enforce their demands. In reality, bling casinos under their control ment agencies, can drrest and fraud is too extensive in these situ . although heavily populated by has extended its scope of inquiry eventually eradicate this national ations for efficient and timely de- hoodlums and confirmed rack- beyond domestic borders to areas disgrace, organized crime . eteers, organized crime is partici- throughout the world . In connection with the Strike pated in by numerous other crimi- Force effort, there were 1,472 ex . nal elements who reside in most

" / Annual Report / Chapter Four Organized Crime Drive and Firearms Activities / 45 State and local law enforcement Set zures and arinests for firearms violation s authorities have also been assisted by the Service. For example,. in re- E9 E= sponse to a municipal police de- S.iZ....: partment's request, special agents ri...... -Irw 4 152 Destructive ciftice, ...... do of the Intelligence Division guided . do: _ (.) .9 Whid ...... : police efforts through a wagering _t3_Property. _. .(appraised. . . _ ...... ___...... _. .._. . . . ._...... _dontr. s 499 76 3 investigation and furnished the A, umber . 715 raid plan which was carried out I Not available. with great success . Among indictments returned as a result of Strike Force efforts was one against a leading racketeer Results of criminal action in firearms cases (Federal courts ) who was charged with conspiracy N . .bl, of defendant, and income tax evasion . He re- Action ported a net income of less than $90,000 whereas he allegedly had 1969 an income in excess of $1 million Indictments and information ...... __...... _ ...... _ ...... 33 1 I;m for the period in question . The tax law enforcement efforts Dismeals. tool ...... _ ...... 278 Eil in wagering taxes were for practical purposes neutralized by Supreme PIOA.guilty or note contendere- ...... 126 433Win Convicted sitar trial ...... 45 Court decisions in the Marchetti 16 and Grosso cases in January 1968 . A' d ------91 in The Service will, upon request, par- ticipate in investigations involving wagering cases, although this type Firearms Act in 193, . Due to ex . The preceding statistics are in- of violation is not within the juris . perience gained under earlier legis . dicators of the success of the in- il diction of the Service . Last year the lation, and because of an effective tensified effort to use strengthened Service completed a significant in- law enforcement capability, re- firearms control laws as a major terstate wagering case which shook sponsibility for administering and tool in the broad and continuing the sports world, caused the indict- enforcing the Gun Control Act of fight against crime. These statis- ment of numerous successful book . 1968 was also given to the Service. tics, however, which primarily makers, and publicized the tena- relate to violations of Federal stat- cious determination of organized Significant Results Achieved utes, do not tell the complete story . crime to dupe uns uspecting Under the Firearms Program Objectives pertinent to the intent athletes . In a total of 627 investiga- of the law to assist local, State and 1970 Federal enforcement bodies are tor man-years were used on fire- also being achieved . arm activities compared with 442 Firearms Enforcemen t required in 1969 . Investigations conducted under the firearms pro- Disarming the Crimina l Guns and the Service gram in 1970 led to the completion A pilot project, aimed at disarm- of 2,975 criminal cases, the arrests ing the criminal in the District of The Service attaches great sig. of 1,957 violators and the seizure Columbia is an outstanding exam- nificance to its responsibility for of enforcing Federal gun laws 30,307 1 firearms. These figures ple of local law enforcement assist- . Re. compare with 1,595 criminal cases, ance . Conducted by a select group sponsibility for gun laws was ini- 715 tially given to the Service with the arrests and 4,152 firearms of special investigators, the goal seized in 1969 . In the regulatory was to determine the effect of an enactment of the National Firearms area of firearms control, 54,369 Act in 1934. That Act was designed intensified Federal program in help- investigations of the activities and ing local law enforcement officers to control gangster-type weapons ; operations of licensees were com- and, because its passage was reduce the crime rate in a metro- pleted in 1970 leading to the dis- politan area. Special emphasis was based on the taxing powers of the covery of 1,812 purchasers of fire- Congress, its administration was placed on the arrest and prosecu- arms with criminal records and 300 tion of convicted felons possessing vested in the Service . Responsibili- purchasers who had used fictitious ties for gun control were increased weapons and armed violators of names or addresses. The following other statutes . with the passage of the Federal tables reflect in greater detail ac- complishment under the firearms I Not including 4,372 divint-ti,ve do . Vices 0,..d. program for the past two years .

Organized Crime Drive and Firearms Activities / 47 46 / Annual Report / Chapter Four Investigators working on the In Missouri two felons were Militant Activitie s ment agencies, including intelli- hired to put a man out of business gence gathering support. While the pilot project have developed and because he had chosen to buck The category of destructive de- maintained excellent liaison with vices has come into prominence effects of these demonstrations local police departments, other "big business" by opening a small have been particularly manifested household gas company with the wave of bombings and Federal enforcement agencies, and . The two bomb threats across the nation . in vandalism, there have been the U .S . Attorney's office. During felons were spotted by local police These devices (which include many instances of both bombings the first 6-month period of its oper- driving near an 18,000-gallon grenades and bombing scares with all the household gas storage tank owned ; incendiary, gas, or ex . ation a total of 424 firearms were plosive bombs ; rockets ; mines ; attendant ramifications of disrup. seized by Service investigators and by the small businessman . The and similar devices), are the types tion and tragedy. 67 were abandoned voluntarily . A police stopped the two men for The commitment of enforcement que~tioning and found three fire- of weapons most suitable to the total of 695 special investigations activities and avowed purposes of personnel in these areas will be were completed which resulted in arms and a fully armed bomb in maintained whenever the possibil- the car . The bomb, composed of militant groups of radical philo- 159 cases involving 163 defend- sophical persuasion . Such organi- ity of Gun Control Act violations ants, 55 of whom had previous 10 sticks of dynamite, had a set zations have publicly espoused use exist . felony records . More than 600 re- timing device attached . Service of guns and explosives as an in- investigators completed a case quests for assistance were received against the two men for possession tegral means of achieving their ob . Impartation of Firearms from police, and 177 referrals were jectives . Many such organizations and Ammunition by Service-assigned officers of a destructive device not regis. made tered with the Service under the have assumed a paramilitary pos . The Service is in its second year on violations of concern to other ture modeled on irregular or clan- enforcement bodies . National Firearms Act . Both men of administering the provisions of were convicted and sentenced to destine groups which have suc . the Gun Control Act of 1968 re . cessfully operated throughout the lating' to importation of firearms 10 years in prison . world . The Gun Control Act at Work in Montana, police responded to and ammunition . The number of The effectiveness and varied The destructive device sections applications for permits to import a call of a shooting in a bar. Upon of the Gun Control Act provide a applications of the Gun Control Act arrival, they found a body, a for- firearms and ammunition for fiscal can best be seen in case illustra . statutory vehicle for prosecuting year 1970 totaled 24,360 . During Special Investightons of the Alcohol. eign-made handgun on the floor, tions . A few examples follow : Another felon, free on appeal for and customers who avowed no individuals who willfully use guns the same period 1,054,282 fire . Tabs. .. and fint- DWIM . or explosives as substitutes for In Boston, a notorious bank a manslaughter conviction, had a evidence seized In the Washington, D.C., kno~vledge of the shooting. They arms were imported (includes rifles registered National Firearms Act area during the early months of the dialogue and reason . and handguns .50 caliber and robber, suspected of having com- c1rhr. to "Di . .- the Criminal." requested Service assistance in the mitted several murders, was in- type weapon in his possession but investigation . The firearm in this The efforts of the Service have under, and shotguns), and 1,128 by a Federal Grand Jury for failed to obtain the required au- been to focus investigative atten- applications were disapproved cov- dicted case was traced from Germany tion on the un lawful acts of indi- making a false statement to a li- thorization to transport the weapon arms from a felon suspected of through Mississippi and finally to ering imports totaling 12,412 fire- censed firearms dealer in the pur- across a State line . He was arrested trafficking in narcotics . Thirty-six Montana where the last known viduals who by pronouncements or arms not meeting the importation associations have beco me identi- chase of a firearm . At the time of in Wyoming, convicted, and given firearms were seized from the sus- owner was identified by the Service criteria . arrest, he was armed with a loaded' a 5-year prison sentence. pect's car . Subsequent investiga- investigator as a customer of the fied with militant grou ps . Infiltra- The Service also continues to 17 of the firearms tion and the judicious cultivation of .38 caliber revolver, stolen from a Police investigation of a bizarre, tion proved that bar on the night of the murder . He administer, under Executive Order firearms manufacturing company. brutal sex murder revealed that a had been stolen. The felon entered was subsequently convicted of sources of information have en- 11432, the importation provisions A second indictment has been re- suspect might have recently pur- a guilty plea to the violations of the homicide. abled the Service to perfect cases of the Mutual Security Act of 1954 turned covering the stolen firearm . chased a firearm . A Service investi- Gun Control Act and was sentenced against several well-known crimi- covering articles on the U .S . muni- In Utah, a defendant with a long gator was notified and through an to 10 years in prison . rial activists. Collateral benefits tions list (includes arms, ammuni. criminal record was charged with extensive search of licensed deal- An investigator trainee received from these investigations in the tion, and implements of war) . furnishing false information to a ers' records, found a firearm sale information concerning alleged form of referrals by Service investi- dealer in the purchase of a shot- to the suspect, who was in a Cate- firearms caches, stolen Treasury gators to other law enforcement g u n, and with a violation of the Na- gory of persons prohibited by the Bills in $100,000 denominations, agencies have enab!ed these agen- tional Firearms Act after he sawed law from purchasing a firearm and and stolen merchand ise . He pur- cies to successfully conclude in- off the barrels of the shotgun . Con- who had provided false informa- sued the information in an under- vestigations of organized extremist victed in Federal court, he was tion to the dealer. The suspect was cover capacity . The information factions . given terms of 5 years imprison- arrested and jailed on the gun vio- was developed into an Organized Demonstrations, civil disorders, ment on each of the two counts . lation, and conclusive evidence was Crime Strike Force investigation in and riots have necessitated Service later developed as to the subject's cooperation with the Federal Bu- involvement, primarily to protect guilt for the murder after he had reau of Investigation and resulted Service facilities, and provide ad- initially been written off as a in the arrest of three organized visory assistance to other enforce- "harmless nut. " crime figures . Four $100,000 An investigation by Service in- Treasury Bills, part of a theft of vestigators assisting the Bureau of $13 million from a large trust com- Narcotics and Dangerous Drugs re- pany in New York City, were sulted in the purchase of five fire- recovered .

48 / Annual Report / Chapter Four Organized Crime Drive and Firearms Activities / 49 International Tax Administration in the M&DDUT Activities Foreign Are a Tax Assistance for Citizens Living Five and Working Outside the UniteU States CIAT Continues to Mature Assistance Furnished to Emerging Nations

I

I The Services international spe . Introduction To develop comparable expertise In its latter role, it employs a per- The foreign cities where the Foreign Taxpayer Assistanc e in the international area, the Serv- cialists endeavor to assure that the manent network of Service repre . posts are located are as follows : The Service has a broad over- ice has created several groups of Internal Revenue Code and tax sentatives at various foreign posts, In terms of tax assistance, the seas program consisting of three specialists . These include : treaty rules are applied in a cor . operates a special taxpayer assist- Manila Rome average American taxpayer living functions. One involves the ad- 1 . Eleven groups of specially rect, fair, and nondiscriminatory ance program which sends a num- Paris Bonn overseas is less fortunate than his ministration of tax laws as they manner, and that where double tax- Stateside counterpart . There are trained international examiners, ber of technicians on annual trips London Tokyo apply to U .S . citizens living abroad . located in key districts throughout ation or other inequities occur relief throughout the world, applies the nine Service offices abroad where nonresident aliens, and foreign cor- the country . Together with district and assistance will be made to the Ottawa Mexico City a taxpayer can go for tax assist- tax relief provisions of Revenue ance, compared to hundreds of lo porations . Another involves pro- revenue agents, they conduct joint taxpayers affected . They seek to Procedure 64-54 and aids the Sao-Paulo Saigon . viding assistance when requested audits of corporate returns which acquaint taxpayers with the special Assistant Commissioner (Compli . cations in the States . Telephone rules and procedures which apply service overseas has obvious limi- to developing countries in improv- indicate transactions between re- ance) in administering tax treaties Subject to agreements with for . ing their systems of tax administra- and foreign companies. in the international area, as well as tations and offers only marginal lated U .S. which provide a number of special eign countries, the staffs of foreign . The third function involves This joint audit procedure referred the special benefits and measures access to the Service's facilities tion benefits and relief measures to posts advise and assist American participation in the negotiation of to as the "Coordinated Enforce- of assistance and relief . abroad . The Stateside taxpayer by taxpayers. taxpayers abroad with their U .S. tax tax conventions or treaties with ment Program," is closely super- A presentation of the major comparison has only to reach for problems . They audit returns of in- foreign countries to prevent eco- the National Office Audit activities of the Office of Interna- a telephone to dial any number of vised by dividuals, corporations, partner- nomic double taxation . The more tional Operations follows : local Service offices for assistance. Division which, in appropriate Steady Growth in Number ships and others, hold conferences important highlights and accom- cases, [ends the assistance of Professional tax service is also very of Foreign Corporation s with taxpayers and their repre- limited overseas and can hardly plishments in carrying out these economic specialists . Sharp Upward Trend in ~entatives, and develop essential functions are related below. 2 . Corporation Tax and Reor- in Which U.S. Persons Own compare with the countless num- information to be used *;n, cases ganization Branches in the National ReturnsFifled by U .S . at Least 5% of Stoc k bers of tax practitioners who are under investigation or in it gation available in the United States . The office Income Tax Division, issue Civilians Living Abroad Number uf in the States. income tax rulings on international conmrstioni American taxpayer abroad is at a Development of Tax Number o f 45,000, They have unique responsibili- questions . Wum. decided disadvantage when he Administration in the I ies under the tax treaties between needs tax assistance and advice, 3 . A branch in the Legislation the U .S . and foreign countries . Foreign Area and Regulations Division of the when compared to his Stateside 210,000 They are usually the first and often counterpart. The quarter century since World Office of Chief Counsel specializes the only representatives of the For the past 17 years, the Serv- War 11 has seen a peaceful explo- in preparing regulations, treaties 40,OOCH United States Government to hold sion in foreign trade, in U .S. busi- and legislation in the intenational ice has provided a worldwide tax 200,000 discussions with foreign officials on assistance program . This year 14 ness and investment abroad, and area . particular cases under treaties re- . revenue agents and six tax auditors in the U .S . population which lives 4 . A branch in the General Liti lating to the avoidance of double gation Division of the office of Chief went to 97 cities in 50 countries to and works in foreign countries. (To Af taxation and the exchange of 190,00 0 35,0001 help some 29,000 taxpayers file cite one statistic, over 2,300,000 Counsel performs various legal information . functions in connection with litiga- their U .S . tax returns . U .S . citizens, including more than In terms of responsibilities, civilians, are presently tion and settlement of cases involv- To effect economies in program 850,000 areas covered and movement of costs and manpower staffing, the located outside the United States.) ing international issues . 160.0ti o U.S . citizens abroad, present day 5 . A branch in the National taxpayer appointment system used At the same time, there has been a 30,0001 staffing of these foreign posts is great increase in foreign business Office Audit Division has specialists in rendering tax assistance in prior critically short of true staffing years was discontinued . A full . and investment in the United to administer the interest equaliza- 170,000 needs. The two-man post in Sao scale seminar program was con- States . tion tax . Paulo, Brazil, for example, has The tremendous foreign busi- 6. A task force deals with the ducted this year in combination jurisdictional responsibility over with walk-in self-help service . The ness growth ha s been matched by unique problems involving U .S. 160.000 1967 1968 1969 197 0 the entire continent of South seminar concept, tested experi- a proliferation of complex tax citizens with secret foreign bank 1965 1966 1967 1968 196 9 America. The meager staffing of mentally during the 1969 filing problems, together with a new body accounts. the foreign posts, coupled with the 7 . The Office of International The Office of International Oper- Operations Abroad period, proved to be so effective it of statutory and administrative law. vast areas they cover, continues to Operations administers the Internal ations engages in the usual audit The Service has 10 foreign posts was expanded during the current To operate mo re effectively in the impose serious limitations on our Revenue laws and provisions of tax and collection activities of district operating as miniature district year's program to include 173 international theatre, many law and overseas enforcement efforts in treaties as they apply to U .S. citi- offices and provides information offices, manned by 20 technical seminars in 73 foreign cities . A accounting firms and large cor- the face of a steady increase in zens doing business abroad . and assistance to our taxpayers and nine clerical personnel . This further refinement was added to porations have developed depart- . U.S . investments and the numbers ments of intern ational tax special- The groups have evolved inde . who reside or do business abroad includes a temporary post in Viet the program by tailoring the semi- of taxpayers abroad . As an interim nars to common-interest groups. ists . These practitioners deal with pendently in response to needs and Nam added this year. These posts measure to narrow the gap between U .S . tax rules, pressures experienced by the Serv- provide the principal link between Five thousand taxpayers attended foreign as well as foreign post workload and avail. the seminars and with complex issues arising ice . They perform a wide range of individual taxpayers and U .S . busi- . This record attend- able staffing, the Service is con- ance brightens the outlook for from the interaction of both-for functions, from basic audit work to ness entities abroad and our tax sidering detailing personnel from example, questions of source of formulation of new laws . While programs at home . future development of an economy- Washington . Further expansion focused technique. income or allocation of income and directly concerned with various both in the number of foreign posts phases of taxation, their activities expenses between related U .S. and and manpower will continue to be a . foreign companies . have broader implications prime Service objective in realizing its long-rang overseas mission .

Chapter Five 52 / Annual Report / I International Activities / 53 Administrative Relief filing refund claims had expired Treaty rules are often stated in For Economi c prior to the recommendation of al- fairly broad terms and, as a result, Double Taxation Cases location by the Service. As a result questions of interpretation arise . many U .S . taxpayers were con- To resolve these, treaties include American industry's expansion abroad was accomplished through fronted with the prospect of eco- consultation machinery, referred the organization of complex foreign nomic double taxation with respect to as mutual agreement proce . . For the most to large amounts of income under dures. Such procedures create a corporate structures circumstances where no means of tax personality, known as the com- part, foreign tax rates were lower securing relief was available . petent authority, to represent each than those of the United States, To provide administrative relief country in the settlement of prob- and profits were diverted beyond and to give the taxpayer time to lems and disputes involving the U .S. jurisdictional boundaries to adapt business practices in con- application of treaty provisions . foreign affiliates through the me- dium of inter-company pricing and formity with the law, the Service The competent authority is not service fee arrangements . issued Revenue Procedure 64-54 necessarily one person . Each coun- Internal Revenue agents, whose n December of 1964. Under this try may have a competent authority . .. . Iprocedure, U .S . parent companies for the various functions connected officeThis Overseas of Taxpayer Assistance T specialty is to examine internation- Nearly goo servicemen sta- The Service in Saigon international Operations (010), were given unilateral relief from the with treaties. For example, the free -dd ftlft al transactions involving domestic tioned abroad were given basic in- The black-market currency situ- travels throughout the economic double taxation which Assistant Commissioner (Compli- tax assistance to citi..n . ..Uld. the entities and their subsidiaries, com- struction at 14 income tax schools . Fes Is would otherwise have occurred ation in Viet Nam has been a long United states. 010 01-tO' C- 1 pleted the examination of 953 ance) acts as the United States conducted by Service personnel on standing concern of the Internal ... hod at the . .tn- laft and A.M .Unt from reallocations between such competent authority in administer- Director Joseph G. McQ-- Is --t-d -t cases between 1960 and 1965 . military installations in Europe, the Revenue Service. Vast amounts of the extreme right. companies and their foreign ing the operating provisions of tax . This The income adjustments recom- For East and the Canal Zone money and resources of the United .5 million, re- subsidiaries . treaties . He considers claims in tax training program is co-spon- mended totaled $768 As of June 30, 1970, requests specific cases involving alleged States have been committed in sulting in tax deficiencies of $386.7 sored annually by the Service and Viet Nam which has produced a for aclministrati~e relief have been double taxation, consults with the the Army . The . One account million, an average of almost the Department of climate conducive to black-market market currency $406,000 per case . The Service ap- granted in the amount of nearly appropriate competent authority purpose of the tax schools is to money manipulations, theft of Gov- alone had transactions of approxi- $8 million to 119 taxpayers . of the treaty country involved, and mately $2 million per week . By plied section 482 of the Internal provide the military community ernment property, and other illicit Revenue Code in recommending Twenty-seven of the 119 cases handles exchange of information with its own tax advisors . This activities . analyzing these accounts the Serv- were closed during the past fiscal . and collection assistance matters ice has been able to identify many these deficiencies . This section pro- method of providing tax assistance Illegal black-market money traf- vides for the reallocation of gross year with the requesting taxpayer pursuant to the tax treaty . has been successful in extending fic has grown to serious propor- of the individuals and firms- en . receiving $1 .4 million . The Assistant Commissioner the benefits of our efforts to ap- gaged in black-market activities . income, credits and deductions be- In October 1968 the Service an- (Technical) acts in matters involv- tions. In 1969 a Service represent- tween related taxpayers to prevent proximately two-thirds of our ative was sent to Viet Nam to make The basic practice of the cur- evasion of taxes and to reflect the nounced in Revenue Procedure ing interpretation or application of . . rency manipulators is to profit on 69-13 that on an "ad hoc" basis tax treaties and issues rulings and Armed Forces abroad an on-site inspection of black mar correct taxable income of each tax- ket operations . The inspection dis- the difference between the official the administrative relief provisions technical advice. Offices in the closed evidence of substantial and rate and the current black-market payer. would 6e extended to an entirely Treasury Department also exercise rate in the conversion of Vietna . The increased use of section widespread black-market money 482 in the international area in the now group of taxpayers . It deter- competent authority functions . The manipulation activities by civilians, mese piaster to the U .S . dollar . mined that economic double taxa . Assistant Secretary of Treasury for Many ingenious methods are em . 1960's soon brought the realiza- U .S. military personnel, and U .S . busi- tion that the tax effect of this pro- tion can apply to a controlling Tax Policy is responsible for the ness entities . The Service now has ployed to accomplish this purpose . taxpayer and one or more of its development of tax treaty policy Through close cooperation between vision could not be measured solely three technical representatives con- from the standpoint of the U .S . controlled domestic entities which and tax treaty negotiations . ducting examinations and investi- all agencies of the Government, an . Almost every adjustment operates in a foreign country and Any U .S. citizen or resident may effective program for combatting taxpayer is subject to its taxation ask for the intervention of our gations in Viet Nam and other to a domestic taxpayer's income . As of countries in Southeast Asia . The these illegal money manipulation had an effect upon the related for- June 30, 1970, two~such cases competent authority if he feels that activities of this team are coordi . schemes in Viet Nam has been eign entity which was a party to the have been closed with a total he has been subjected to double nated with related investigations instituted . same transaction . In too many amount of relief approved of more taxation or to other unfair tax treat- conducted in district offices cases it was found that either the than $6 million. ment not in accord with the spirit throughout the United States . foreign country in question did not or meaning of a treaty provision. In November 1969, the Senate permit retroactive adjustments The Competent Authorit y Subcommittee on Investigations once a tax return had been filed, In absence of a world-wide tax opened hearings in Washington on or that its statute of limitations for code, tax treaties furnish a limited illegal currency activities in the Far . measure of uniformity, designed to East. In the course of these hear avoid double taxation and other ings, it was disclosed that seven inequities which can result from U .S. banks were handling transac- $150 separate applications of two na . tions involving approximately tional tax codes . At present, the million per year in Viet Nam black- United States has concluded 21 treaties with 31 nations.

International Activities / 55 54 / Annual Report / Chapter Five I During the year, 71 cases in- information therefrom is ever lur- For many years requests for as- Information furnished under the sistance have been handled on an volving 15 foreign countries were nished under the automatic ex- Foreign Investment come. In these cases, the payers individual basis, without the aid of considered under the mutual change program . specific request program generally in the United State s are allowed to withhold at the ap . involves three classes of taxpayers : plicable reduced rate. To minimize established procedures . Various agreement provisions of income During the year foreign tax (1) Foreign investment in U .S . busi. groups in the Treasury Department and estate tax treaties and 44 were treaty countries supplied the .Serv- nonresident foreigr6persons, in- ness has contributed measurably the administrative burden an with. closed . These cases covered a wide ice with 192,000 documents bear- cluding corporate entities ; (2) U .S . holding agents, tax is withheld on have been working to resolve the citizens ; and (3) related domestic to the growth of the U .S . economy. difficulties in formalizing proce- variety of treaty issues, ranging ing information about foreign To stimulate such investment, and the basis of the address of the from allocations of profits between source income derived by United and foreign commercial enter- recipient of the income without dures. Their efforts culminated in a prises . Requests under this pro. thereby improve the U .S . balance landmark directive, Revenue Pro- related business enterprises to tax- States citizens, and residents, and of payments position, Congress verification of the citizenship or gram are very limited in number residence of the beneficial owner cedure 70-18, recently published ation of alimony payments . Some the Service sent 412,000 informa . and the majority relate to nonresi passed the Foreign Investors Tax . by the Service (IRB No. 1970-29, were taken up for consideration at tion documents to the foreign tax . Act of 1966 . This legislation In a number of treaty countries, the request of foreign competent treaty countries . dent alien individuals and foreign banks and other nominees collect p. 23). corporate matters . The types of in . amended the Code to provide more Revenue Procedure 70-18, sets authorities, but most resulted from There are I I estate tax treaties, favorable tax treatment to foreign and remit to the United States an formation requested fall into three additional 15 percent when divi forth applicable procedures for requests made by United States one gift tax treaty, and one combi- broad categories persons, including corporations, . taxpayers . There is every indica- nation estate and gift tax treaty . . These are : (1) the who derive income from dends are received from U .S. handling issues by the U .S. com- taxpayer's financial activities ; (2) U .S . petent authority in cases involving tion that this activity will become All except one contain provisions sources . sources on behalf of clients who the taxpayer's travel and residence are not residents of the treaty the allocation of income and deduc- increasingly more important in the for the automatic exchange of in- activities ; and (3) U .S. tax treat- A reliable barometer of trends in tions between related corporations years ahead . formation to facilitate administra- foreign investment is the statistical country, and thus nut entitled to ment of individual or related the reduced withholding tax rates . or other parties, one of which is a tion of estate and gift tax laws . persons . data compiled by the Service re-. U .S . taxpayer and the other subject Exchange of The Service obtains prime bene- flecting the flow to foreign rect pi . This cooperative practice assists in Under Service rules, any specific eliminating abuse of treaty bene to the jurisdiction of a foreign Information Program fits from these exchange of infor- request for information must be ents of U .S . income in the nature . country with which the United mation provisions . On the basis of of dividends, interest, rents, and fits . Currently the Service is Many taxpayers doing business the information sheets received concerned with a particular item of royalties negotiating with the German tax States has an income tax treaty. income or expense, and with the . From 1964 through The new revenue procedure ex- on the internationa scene are curi- from foreign treaty countries re- 1968, the amount of this income authorities to develop a system of ous about the exchangeI of tax in- porting United States assets, the determination of the income tax li . received by withholding additional U .S . tax plains how, when, and where re- ability of only one taxpayer . It must foreign persons in . formation that goes on between Service is often able to secure de- creased from $714 .5 illion to from income flowing to German quests for competent authority countries . They frequently want to also indicate the reason such in- consideration should be filed, in- linquent returns . Frequently, these $1,100 .7 million--a gainm of more nominee banks . know what one country is telling information sheets disclose assets formation is required . In addition, than 54 percent formation required, and conditions the treaty country must furnish evi. . . Additional procedures another country, especially their which were not reported on U .S . A key tax aspect of foreign in. to be met country of residence, about the dence that the person is involved in are planned to cover other issues estate or gift tax returns. vestment is the Service's system nature and size of their income . During fiscal year 1970, we business or other financial transac. of withholding tax due on income which cause taxpayers to seek tions that would subject him to the assistance of the competent The competent authority is re- received approximately 2,880 in- paid to foreign taxpayers outside sponsible for executing the tax tax laws of the country, and that authority . formation sheets from the partic- receipt of the information is perti- its jurisdiction . The present with- It the competent authority feels treaty provisions which describe ipating foreign, countries . In turn, holding procedures reflect lessons exchanges of such information for nent and material in the determi . that a case has merit, he will con- approximately 625 information nation of the tax liability. gained from years of experience . tact his counterpart, the compe- income tax as well as estate and sheets were sent to governments Before the present procedures were gift tax purposes . of foreign treaty countries inform- adopted, nonresident foreign per- tent authority of the country in There are two general types of which the alleged double taxation ing them of assets which may be sons filed returns and paid taxes or tax inequity occurred, and ar- information exchanges, automatic, taxable under the treaties or their after the close of the taxable year, and by request in specific cases . range for consultations . Settle- laws . in the same manner as U .S . citi- ments made at these meetings are Under the automatic exchange As a continuing part of the Serv- zens, As a result, the Service not reached-in adversary proceed- program for income tax, the Serv . ice's obligation to assist taxpayers experienced many collection prob . ings ; they are agreements which ice gives each foreign tax treaty and foreign taxing authorities in lems in the case of taxpayers reflect recognition of each coun- country copies of Forms 1042S alleviating taxation of the same as- outside of the United States who and Forms 1001 which pertain to sets by both countries, the Service had no assets physically located in try's tax sovereignty, the existence residents of the respective treaty of reasonable differences of opin- provides certifications of the the United States against which the country, other than U .S . citizens, amount of Federal estate tax paid tax could be levied, ion, and the overriding need to who derived income from U .S . achieve an equitable solution to a to the United States, thus permit- Under the internal Revenue problem which neither country sources . These tax forms were filed ting a tax credit against death Code, investment income paid to by withholding agents to report could resolve independently. duties imposed under foreign tax foreign taxpayers is subject to the amount of U .S. source income laws . During fiscal 1970, the Serv- withholding of U .S . tax by the payer (dividends, interest, rents, royal- ice provided 175 certifications to at source, at the rate of 30 percent ties, and pensions) which were paid governments of both treaty and of the gross amount. However, to nonresident aliens, and the nontreaty countries. most of our income tax treaties amount of U .S. tax which was with- reduce the tax rates applicable to held from such income . Neither various types of investment in- copies of income tax returns nor

56 / Annual Report / Chapter Five International Activities / 57 Tax Withhold from Payments to Nonresident Alien Persons of Treaty and Nontreaty Countries- Calendar Year 1968 For the most part advisory tax administration assistance is offered Thanifund delta . in partnership with the Agency for N .M ., . 1 International Development (AID) . cmmtsy Tax withhold Tax from information The principal focus of the technical by domestic f.r.iff. Total tax d.,..,nt, Imers . withholdin g Imn,mments, o r withh~ld assistance has been on Latin Amer- agents withholding .Santa ica, and certain high priority coun. tries on the rims of the Iron and Total ...... 1,100,720 117,796 26,876 TrasZowrit'll : 144,662 499,914 Bamboo Curtains . 4 maillc------2,705 366 W 366 3. 738 Service advisors do not partici . latri------I ------I ...... _- ...... 157 2,232 pate in the actual decision making 17 53. . 2,2157 ------197 2,412 7,609 Pmrx ., Gfj~ i ; 37 or in the operation of a host coun- Canada...... ------202,1194 ('~5, 615 ------* I " -1 '01 ------11_,_7__6- 21 6DG Denmark ...... ------9,195 167 try tax administration . The pro . Fi n land. __ ------...... 671 ,1 : 446 1 .236 36 ------36 268 Fars1 . 46,436 4,578 14 4,592 gram does offer counsel, in several 92,899 2.51 15.399 . .-- ...... __ . . 4 ...... 2,514 31 .664 forms, on how to orgam ze, manage Gr ...... 1,290 211 ------211 2, 328 1I land ...... _ ------__------3,328 43 ------4307 2fl~: 9 0 and operate tax administration fair - S. 9D9 797If ---- 79 7 790 agencies. sea; . ------...... ------* ------10.775 11106 2,200 LuXe btaoudr,n ...... ------9,452 31 '3 19 ------1156 6 2,13 7 N .th m., ...... __ ...... 56 662 10 480 429 01908 51 : 158 3, 11h .1had. in Antilles...... ------. . . ------351 :317 2 :989 . ------3 21892 h -.reinZialimd~., ----- ...... __ ------...... Review Certifies .7397 57 57 3,8869 70 Program Qualit Paki s tan ------209 y 21a3 '202' 2 2 16 1 sw"im .------. . ------917 ------__ --- 917 3 702 A full scale review and evalua- S.Itziullibj ------1 115: 15'4! 20,025 24,637 44,662 34: 03 3 Trinidad itni 23 5 so tion of all Treasury Department Unft.. I.th rf ~li ...... ------2718 26 2 7 Commissioner Thrrower, Deputy Asbind -I S T i 225I : B393 26 , 1 78 ------technical assistance programs was Commissioner Smith land S.,i. . Offi.lals for Liberia . Since 1963 there have Unliml K!N.d :dme. ------. 441 39. 961512 1 3 662 83 completed in 1969 by a three-man at a State Department meeting with been 301 short-term assignments Nonlresty countries by Forms 1042S___ ------5: '3 4 15,780 ------15, 7807 :366 01 A.tbni Treaty and rontruty, countnes by coupom bond intumsti~:iVCW~rWiWt3 : : : : : : : : 112,517 753 ...... Armil-r do 01N.I. Lt.., to 32 53 22,249 panel of private experts . The panel Sacnatalry of Fachmal Receipts for Brazil countries and three interna . found that the Service program was end members of his .1taiff. tional organizations . I Amounts to unall to repor t -a successful technical assistance Pictured left to right are : Albert Brisbin, D,,AntxknIo Augusta do Mesquite Note, activity, with an above-average rec- will lam H. Smith, DL Antonio Amll- do During calendar year 1968, a An estate tax convention was ord of producing desirable changes DrClilvehis Lima, Randolph W. Thrower. Sharp Upturn in Foreign than they do elsewhere. The pur- . P.d . Nonnais, d. Lim ., Harold Me .. . total of $144 .7 million in tax was signed with the Netherlands on pose of the Foreign Tax Assistance in the administration of taxes in Edexand F. Preston, end Edwerd Lewis . Visitor an d withheld from income of nonresi . July 15, 1969 . On January 9, Program is to assist tax adminis- less developed countries . In its gen- Training Activities eral conclusions, the panel con. dent individuals and corporations, 1970, a new income tax conven- tration officials of developing coun- Several milestones with respect as shown in the following table . It tion with Trinidad and Tobago was tries in alleviating these problems firmed a prior approval of Service operations in four Latin American to our foreign visitors and training will be noted in column 3 that signed, and on March 6, 1970, an by renovating their tax adminis- activity were witnessed in $26 .9 million of this amount was income tax convention with Fin . countries given by a 1966 review No new long-term efforts were 1970. tration institutions . undertaken this year. Teams in First, 513 tax administration and withheld by treaty countries, in- land was signed . Managed and coordinated by the panel . The current review also cluding $24.6 million withheld by made several valuable suggestions Chile and the Philippines success- finance ministry officials from 67 Foreign Tax Assistance Staff, the fully completed their missions. countries and one U .S. dependency Switzerland . program is a Service-wide effort . for improvement of the program . Foreign Tax Short-term advice will be continued visited the Service this year for Over the past 7 years, every Serv- for these two countries, as re- orientation and training in modern Assistance Progra m ice function has contributed ex. On-Site Assistance Negotiations of Contracts Slightly quested . Problems raised in the tax administration management . perienced manpower and training Central American Common Market This is an increase of 133 percent Tax Convention s Gibir . . . Impuesto . . . Oara'Ib services . . . Ker . . . Imposto . . . Sekim . Contributions come from Advisory teams are active in 18 by the El Salvador-Honduras con . over 1969. Eighty of this year's Attorneys from the Office of the the regions, districts and service foreign countries; Argentina, Bo. flict resulted in suspension of our visitors held offices equivalent to . . . Kedi . . . Buwis . . . Impot centers, as well as the National Chief Counsel, as representatives . . . Vergiler . . . Thue . . . Tax. livia, Brazil, Colombia, Costa Rica, regional effort in AID's Regional Assistant Commissioner or above . of the Commissioner of Internal Office . the Dominican Republic, El Salva- Office for Central America and Secondly, since the outset of the Revenue, assisted the Treasury De- As the Foreign Tax Assistance In devising the program, the staff dor, Guatemala, Honduras, Korea, Panama . program 2,206 officials from 97 partment in negotiations with Program begins its eighth year of maintains contacts not only with Nicaragua, Panama, Paraguay, Frequently, this long-term assist- countries and four U.S. dependen . Trinidad and Tobago, Norway, and operations, one basic truth learned the developing countries but with Peru, Trinidad and Tobago, Turkey, ance is supplemental by short- cies have passed through Service Turkey concerning bilateral income long ago is still very much in other suppliers of technical assist- Uruguay, and Viet Nam. Over the term (up to 90 days) advisory offices . tax conventions . Negotiations also evidence. Regardless of the lan- ance, principally, the Organization year, an average of 53 long-term assignments, although in some in- The seminar scheduled by the took place with France concerning guage in which it is spoken, the of American States, the Inter- advisors staffed the teams . stances short-term assistance has International Tax Administration a bilateral estate tax convention word "tax" conjure's u p the same American Development Bank, Ihe been offered to countries without Training Series (INTAX) are an im . and a protocol to the income tax images in the mind of the taxpayer nternational Monetary Fund, the regular teams, Fifty-one short-term portant aspect of this activity. Sev. convention which would have the and raises similar administrative United Nations, and others . assignments were completed in eral years ago it became evident effect of extending the "avoir fis- problems in all countries . In de- 1970, with services going to 19 that we were being inundated with cal" to certain-U .S . residents . veloping countries, where revenue countries and two international visitors having the same language needs are acute, these problems organizations. A survey of tax ad- and cultural background and need . assume more serious proportions ministration needs was completed

58 / Annual Report/ Chapter Five 40i-9(n 0-71-----b International Activities / 59 Tax Court Decides 570 Cases ing the same managerial and super- CIAT Continues Assistance in Legislative and MEED~(!N? visory training . To provide an eco, To Mature Non-Federal Legal Activities Service Provides Assistance in nomical and efficient means of Drafting Revenue Legislation Six The Inter-American Center of U.S. Taxes training groups of similarly situ- Much Tax Legislation Pending ated people, the Service, in 1965, Tax Aaministrators (CIAT), initi- Most developing countries im- initiated a set of management and ated in 1967 with a strong assist pose a greatervariety of taxes at $131 Million Obtained for the supervisory courses, offered in from the Foreign Tax Assistance the national level than the United Government in Settlement or Trial English, Spanish or Portuguese. Program, continued to provide States . Conseqbently, the program of Cases in the Tax Court This provided an unusual oppor- evidence of its rapid maturity . has been providing, at an increas- tunity for cross-fertilization of Jamaica became the 22d country ing rate, assistance in the admin . ideas from various countries . This member just prior to the Fourth istration of such taxes, principally year eight management courses General Assembly in Montevideo, general sales taxes and real prop- were presented for 110 Partici- Uruguay, in May 1970 . The U .S . erty taxes . Long-term advisors in pants . One, a first, was in Korean ; Delegation to the Assembly was led each of these areas are now over- the others were in Spanish or by Commissioner Thrower, who seas and, in the past 3 years, five Portuguese . Since 1965, 32 sem- presented a paper, entitled Regu- short-term assignments in sales inars have been given for 445 lations and Rulings : Their Contri- tax administration and seven as . participants . bution to Improved Tax Adminis- signments in real property tax ad- Mobile instruction teams pro- tration in the United States . ministration have been provided . viding basic audit training were Throughout the past year, the Com- The program recruits advisors from sent out this year to Colombia and missioner, as a member of CIAT's State and local tax administrations . Uruguay . Executive Council, took an active The increasing interest in these role in the management of the areas is also reflected in the foreign organization . visitors program . To meet the ris- In January 1970, CIAT spon . ing requests for training, contacts sored a technical seminar for man . were developed with a number of agers of automatic data processing State and city tax administrations operations . Forty-four officials from noted for excellence . As a result CIAT countries attended this con . of their generous assistance, high ference, held in Bogota, Colombia . quality orientation and training was Deputy Commissioner Smith, who provided to an increased number is also a CIAT member, presented of visiting foreign tax officials. the opening paper on the Internal Organization of Automatic Data Processing . Vito Natrella, Director of Statistics Division, made a pres . entation on the Tax Return as a Statistical Document : The U .S. Experience.

I

60 / Annual Report / Chapter Five Introduction labor disputes, contract appeals, million from $427 .5 million at the Tax Court Litigation Activity During 1970 the Tax Court en- tained as to $131 million in taxes and personnel appeal actions, and start of the year. This increase re- The number of Tax Court dock- tered 570 opinions involving 859 and penalties out of $400 million The legal work of the Service is the Director of Practice in disci . sulted from the receipt of new cases cases . Of the 570 opinions 327 asserted against taxpayers and performed in the Office of the Chief eted cases on hand June 30, 1970, plinary cases . involving $155 .4 million and the increased from 11,048 pending on were decided for the Government; saved $30 million out of the $36 Counsel . The Chief Counsel ren- disposal of cases involving $86 .3 82 for the taxpayer and 161 par- million in overpayments claimed by ders opinions to officials of the the same date a year earlier to tially for the Government and par- million . The amount of $155 .4 mil . 11,453 . During the year 6,969 taxpayers . At the end of the year, Service on substantive legal ques- Civil Litigatio n lion involved in new cases received tially for the taxpayer . The Courts $1 .4 billion was involved in taxes tions . The legal staff prepares new cases were race ived and 6,564 during the year-represents an in . cases were disposed of-5,343 by of Appeal rendered 124 opinions and penalties being contested in drafts of proposed regulations crease from the amount of $111 .2 involving 200 Tax Court cases. Of the Tax Court . (Comparable sta- implementing tax laws and par- Refund Litigation Activit y stipulated agreement 763 by a de. these 96 involved in cases received in the cision on the merits, and 458 by were decided for the tistics for the past 5 fiscal years I ticipates in the rulemaking proc . During the year 1,182 refund preceding year . The 1,160 refund Government, 16 for the taxpayer are shown in the following table . ess . For a discussion of the regu- litigation cases were disposed of dismissal . and 12 partially for the Government suits disposed during the year The Supreme Court rendered one In the trial courts (Court of lations program see chapter 1, and 1,189 new cases were re- gave rise to refunds of $34,094, and partially for the taxpayer. Claims, U .S . district courts, and page B. The office also furnishes ceived, leaving a total of 3,421 000, consisting of $7,850,000 decision in favor of the Government During the year, in the trial or United States Tax Court) the record technical assistance to the cases pending at the end of the refunded pursuant to Court of involving two cases originating in settlement of cases in the Tax of Government wins, losses, and Treasury Department's legislative year . In the previous year 1,573 Claims judgments, $4,949,000 re- the Tax Court during the year . Court the Government was sus- partial wins apears below . program . cases were disposed of and 1,246 funded pursuant to district court The Chief Counsel represents cases were received . judgments, and $21,295,000 re- Results In Tax Court cases the Commissioner in trying and The Supreme Court rendered funded as a result of settlements . participating in the settlement of four decisions in tax refund suits The total refund of $34,094,000 Cases disposed of by settlement cases docketed in the Tax Court during the year. The Government's represents a recovery by the tax- Cases disposed of by trio) 1 of the United States . The legal staff position was sustained in three Tota l payer of about 40 .4 percent of the Total deficiencies Deficit. tax also furnishes advice relating to cases and rejected in one case. In Fi ce t number and Total and a d amount of $84,356,000 involved YX of cases Penaltie s amount, 0-11 Number Defectimnalt".., Amounts Pon refund litigation, general litigation, disposed = 1 Recovery Numb ., fit,, Amounts Recovery the previous year the Supreme in refund suits disposed of during assert e d recovered asserted recovered percentage asserte d .a, .r,d perportg. of (thousands) (thousands) thousands) (thousands) criminal enforcement, and alcohol, Court had also rendered decisions the year . In these refund suits, the (thousands (flumunds) tobacco, and firearms matters . Im- in four refund suits, with the Gov. i96 6 6 22 7 447 844 $137 Government's position was suc- .723 30 7 5 $398 17 1 $111 962 28 9249 711 $4571:603 $17,901 portant court actions are included 1 967 : :--- :--- 7:24B 367: 34 .6 9 ernment' s position being sustained cessfully defended wth respect to 109 505 29:76 1: 274 312 :156 85:179 27: 659 249 15 807 33 4 5 968 5,944 313.875995 98:825 31,48 5,059 281,785 82,215 29 .18 611 29 131 in the appendix beginning on page 1 9 5 83 1 393 699 , 13 : 859 47 : 5 7 in each case* . $50,262,000 of the amounts 1 41,~ 3 1,1, 4': 7 " 93 1 01 51: 4,1174 1 , 1 783 19.798 22,988 38 . 28 103 . Statistics on legal activities 1611-70. , : ...... 1 6: 564 400: 092 0,724" 32: 3137' 215229 :121' Of the 131 opinions rendered 29 .93 763 926 22,654 50.4 3 are shown in tables 18-25 on claimed for refund, resulting in a pages 132 and 133 . Criminal pros- by the Courts of Appeal the Gov. saving to the Government of this ecution cases are shown under ernment won 87 cases and lost 35 amount . (Comparable statistics for I Figures for settled and tried uses do not add to overall chapter 3, Enforcement Activities, cases . Nine cases were decided the past 5 fiscal years are shown in total,, vvhhh include . small number at ... dismissed . page 35 . partially for the taxpayer and par- the table below .) There were The office also furnishes legal tially for the Government . 22 erroneous refund cases dis- Trial court cases, won, lost, or partially won (and partially lost) for the advice in management support At the end of the year the posed of during the year involving Government Tort Claims matters and represents the Serv- amount involved in pending refund $1,979,000, of which $185,000 The Service acted on 166 Tort Court Claims Diltri purt s To. ice in administrative hearings on litigation cases increased to $496. 6 was recovered . Actio n Court Claims during the last year . The Service also acted on 125 claims 3=mn 1 2m 1969 ., 1 . -1 under the Military Personnel and Results In refund suits (settlements and trials combined) Won ...... 24 Civil an Employees' Claims Act of Last ...... q23 :~ ". -an IA. . . .t, are In thousands at dollars] Docid"ll Partiallytar the farG_mdmmt__ the taxpayer i .a. 1964 . This represents an increase partio It 12 of six claims under the Federal Tort All .fund suit, I Distric t courts Court .1 Claim s Tis Act and 46 claims under Tax Court opinions Involving 730 docketa . Fiscal yes, Tax Court opinions involving the Military and Civilian Em- Number of Amount Amounts Perceal . humberatuses di, Amount . 859 dpckats . I . saved Amounts Percent 4umberof Amount Amounts Percent- ployees' Claims Act over the pre . c . . .. dl, - (not ago not - in send (net a. not uses dj'. in saved (not U . not pond of dispute refunded) refunded Pose d of di sput e refunded) refunded posed at dispute rapruded) , under! ceding year . Tax In litigation !96 ...... 354 $94 .067 $47,774 50 .79 205 $34,397 5z 09 149 $23,039 $13,377 470. lin thousands of dollars] 967 ...... 1 292 110,958 47.613 42.91 '1: 176 '2 : ,331 22.760 46 .14 116 61,627 24 .853 l9lik ...... 33 1, 296 94,607 39.856 42.1 11 715 1 23,562 46.47 178 43.904 16,294 37.1 1 1: 13. 12% 059 72,670 60.533 1 :, 39 1997: " Tax Court Refund fifiginflan 19691970 .------...... ------...... 15 94,356 50,262 . . 59.59 0534 19,246 "26:10,112 "153:1145 16079 3522: 151509 1523 961:678 &679.9560 statu s Tota l Tax. ad over . Refund Erroneous I Don not include a small number of actions by the United States for recovery of erroneous refunds Penalties payment, suit, fund ,.. ..

Pendingfignind 1,805,144 324 211 53,408 425,02115 2,452 0 July 1 ------689,495 1 ' 464 :092308 5 69.988 51210 14 Disposed -ii_ ------...... I ...... - 1.972,521,98211, 6 D 1, 40D3M.2567 35 553 94 356 1 979 P . .di June 30 ...... _ 59 87:943 495: 877 ; 683 AnImm!m y .,ad ------_------41 5 130, 24 30,429 50,262 _...... Annhuo r-,.,.d --- ...... I Revised .

62 / Annual Report / Chapter Six Legislative and Legal Activities / 63 General Litigation Legal Services involve issues relating to the col. trict and suboffices and participa- Service engaged in research and the Railroad Retirement Tax Act to Legislative Cooperation In the area of general litigation , lection of Federal tax claims and tion in general training programs study projects in such areas as give the Railroad Retirement Board The Service cooperated with the case receipts increased over the liens and matters concerning in . for collection personnel. estate and gift tax, subchapter S, authority to determine the amount staff of the Joint Committee on preceding year by 602 cases, i .e ., junctions and civil enforcement of foreign income through export in . of supplemental tax necessary to Internal Revenue Taxation in draft- 10,803 cases were received in internal revenue summons . The centives, and tax incentives for finance supplemental annuities . , ing amendments to the Internal 1970 in comparison to 10,201 in summons cases continue to repre- Revenue Legislation small business . Public Law 91-235, enacted Revenue Code designed to remove 1969. Disposals decreased from sent a major area of litigation atthe Assistance Fliovide d April 24, 1970, extended tax relief obso'ete and little used provisions 10,475 cases in 1969 to 10,138 appellate level. Summaries of some Tax Legislation Enacted to the crew of the U.S .S . Pueblo and furnished technical assistance of these cases may be found start- during imprisonment by North in 1970 . The inventory of pending General The Tax Reform Bill was passed to the Committee staff and to cases at the end of the year stands ing at page 103 . Korea . Extensive legal services were by the House on August 7, 1969 . Public Law 91-258, Senate and House Legislative at 5,578, an increase of 665 cases This was an exceptionally bus y After nearly 2 months of hearings enacted Counsel in perfecting bill language over the 4,913 cases pending at furnished in connection with dis- year for the Service in the area of and a month in executive session May 21, 1970, increased the exist . and drafting committee reports on closure of information, including ing tax on the transportation of the end of 1969. increased re- tax legislation. Primary concern of the Finance Committee, plus 3 three bills in the alcohol, tobacco ceipts occurred at both the Na- matters arising under the Freedom was directed toward theTax Reform persons by air and imposed new of Information Act weeks of debate by the Senate, the and firearms area . tional and field levels and related (5 U.S .C . 552) . Act . In connection with the promul . bill was passed December 11 by taxes on the use of international to cases in litigation and non-court General litigation supervisors and gation ofthisAct and other revenue travel facilities, the transportation lawyers actively participated in all the Senate. On December 30, 1969, cases, such as advisory opinions . legislation, Service personnel at- the Tax Reform Bill became Public of property by air, and the use of Interpretative Activities Receipts at the field level for 1970 training sessions held throughout certain civil aircraft . the country in the Advanced Tech- tended public hearings and con . Law 91-172 . The Interpretative Division fur- included 5,535 cases in litigation gressional meetings, prepared in . Hailed as the most far-reaching and 4,883 non-court cases as com- nical Training Program for Revenue Tax Legislation Pendin g nished legal advice and assistance Officers. The general litigation law. formation reports, and drafted piece of tax legislation since the to the Assistant Commissioner pared to 1969 field receipts of bills and accompanying technical 1954 Code, the Act covers such Among the tax bills awaiting 5,057 cases in litigation and 4,860 yers furnished substantial legal varied areas as repeal oftheinvest- action by the Congress at the end (Technical) and to the litigation non-court cases . National office re- assistance and performed many explanations. of the year were the following'. divisions in the Office of the Chief services which did not relate to The Service also evaluated ment tax credit, reduction in indi- Counsel on many significant prob- ceipts for the year included 159 677 vidual tax rates, taxation of private H.R . 12923, to restrict the type cases in litigation and 226 non- docketed cases, such as rendering legislative suggestions made by its of tax exempt activities available lems . There were a number of day-to-day formal and informal ad foundations, decrease in the deple . court cases, as compared to 1969 . employees, Congressmen and tax . tion allowance for oil and certain through use of industrial develop- interesting and important reorgani- figures of 146 and 138, respec- vice to administrative personnel, payers . With a view toward next minerals, extension of the sur- ment bonds . zation, earnings and profits, and tively . Field disposals for 1970 ,visitations to service centers, dis- year's legislative proposals, the charge for the first 6 months of H .R. 15073, to prevent tax eva- corporate distribution issues. Ac- were 5,113 cases in litigation and 1970, and many other broad pro- sion and other criminal violations counting problems were more 4,693 non-court cases in compari . shielded by deposits of money in numerous during the year than in Case Disposals by 01fice of Chief Counsel visions. The massive 255 page the past. Various problems con- son to 1969 disposals of 5,236 Fft-C-.b., 0 . document will play a significant foreign countries . cases in litigation and 4,928 non- H .R . 16506, to clarify income cerning natural resources as well role in tax developments and the as problems concerning taxability court cases . National office dis- T*W~ tax exemption of cernetery cor- countless hours expended by Serv- of nonprofit organizations were posals increased over the 1969 1969 25,946 ice personnel in its preparation are porations . disposals, 165 cases in litigation 10.475, H .R. 17861, to extend the tax considered . The estate tax area was 1970 27,51 6 but a prelude to the work yet to be very active and there were a num- and 167 non-court cases in 1970 done for its implementation. surcharge applicable to corpora- compared to 163 cases in litiga- In addition to the Tax Reform tions until 30 days after cessation ber of significant legal issues in- tion and 148 non-court cases in Act, Congress enacted a number of of military operations by the United volving the manufacturers excise 1969~. For detailed statistics on public laws relating to tax matters, States in Southeast Asia . tax, the tax on special fuels and highway use taxes. As in past case receipts and disposals, see 7,709 the most important of which are H .R . 17984, to simplify the tables 22 through 25 on page 133 . listed and summarized below: Internal Revenue Code of 1954 by years, many important and sensi- The Supreme Court decided two repealing obsolete and rarely used tive questions involving tax exempt Public Law 91-53, enacted Au- organizations were considered . cases in favor of the Government 6 .121 gust 7, 1969, extended the 10 per- provisions . in the general litigation area during r-i 1 _11_21P cent surcharge through December S. 3963, to eliminate the 50 per- These included the tax status the year and, also, granted certio- 31, 1969, and placed the payment cent fraud penalty against an in- of segregated private schools, rari in one case. There were a of FUTA (Federal Unemployment nocent spouse and to relieve an whether tax exempt charitable or- number of cases decided by the Tax Act) taxes an a quarterly instal- innocent spouse of th: tax liability ganizations interested in social re- courts of appeals and in four cases ment basis . for stolen or embezzl d funds. forms may properly . engage in petitions for writs of certiorari to Public Law 91-128, enacted No- S. 4039, to simplify and reform picketing and rent strikes to the Supreme Court have been filed vember 26, 1969, extended the taxation of small business. Among accomplish their goals, and the and are pending. In five cases the extent to which various section 501 11573 interest equalization tax through other things the bill would give a Court denied certiorari . The deci- 11159 967 F-U,181 March 31, 1971 . beginning business enterprise free- organizations may engage in unre- sions in the general litigation area Public Law 91-215, enacted dom from Federal taxation for its lated trades or businesses without ~ 1 1 March 17, 1970, amended section first 5 years, provide statutory jeopardizing their exemption . G... . I T.. Al.b.1 EM-W R.Wnd 3211(b) of the Internal Revenue status for depreciation guidelines, litigatin Co.rt .,d 11figu. t.b.- h. Code of 1959 and section 3221 of and reinstate a limited small business investment tax credit of $50,000 for manufacturing corporations .

64 / Annual Report / Chapter Six Legislative and Legal Activities / 65 Planning Activities New Legislation Facilitates Taxpayer Compliance @Nalpfty Withholding Procedures Improved Seven Increased Use of Tax Models Computerized Taxpayer Assistance Tested

I

.1/ Introduction returns and accounted for 22 per- withholding system, and evaluating Legislation Facilitating Proposed Legislation The Information Document cent of the total overpayment . In . systems or procedural changes to Taxpayer Complianc e Matching Program has centered on The Internal Revenue Service termittent employment also was an Proposals have been developed new special surveys of taxpayer assist employers, employees, and The Tax Reform Act of 1969 con- recently for other changes in law collects and accounts for more overpayment cause on 33 percent the Service. Prelimin~y results of tained other changes easing tax- compliance . These relate to casino money than any business in the of the returns but accounted for affecting taxpayer compliance. A gambling payments, lottery win- this study show that the majority payet compliance with the income suggestion has been developed for nings and health care payments world . To accomplish this task, only 11 percent of the total . Vol . of employers pay qn a weekly basis, tax return filing requirements. As a . efficient management must be untary overwithholding is accom- liberalizing the requirements for that this is their only payroll period, logical development of the change filing estimated tax designed to aided by systematic planning . plished by filing form W-4, and that they pre0are their payroll in law excusing nontaxable em- Design of Advanced Planning occurs at every level of Employee Withholding Exemption follow up the various legislative Automatic Data Processing themselves . ' ployees from income tax withhold- changes that have occurred in in- an organization . Full-time profes . Certificates, underclaiming the ing, and in recognition of the new sionals are needed to conduct come tax liability and withholding. The long-term program to de- number of allowable exemptions, Alcohol Industry Records and low income allowance, increases velop an advanced automatic data studies, prepare analyses, and de- having additional amounts with- Another proposal, if enacted into Reports Studied were made in the levels at which law, would serve as a deterrent to processing system to carry out tax velop forecasts . These are the held, and (in the case of married individuals are requred to file a tax objectives of the Planning and During 1970 a study group was nonpayment of tax . This proposal administration functions over the employees) using single, rather return . These new levels are de- next decade was continued . De- Analysis Division, Research Divi- than married status formed to cooperate with various affecting nine different sections of . signed to correspond generally with the Internal Revenue Code calls for tailed requirements for AOP sup- sion, Statistics Division and Sys- As a result of the overpayment industry trade associations in mak- the new, higher nontaxable levels tems Development Division, all ing an in-depth study of records increases in, and simplification of, port were developed . These are now study, certain recommendations of income, which for 1970 are being analyzed, to form the basis under the direction of the Assist- for minimizing overwithholding of and reports requirements for the penalties for failure to file re- $1,700 for single persons and turns or pay tax . for development of alternative sys- ant Commissioner (Planning and income tax from the earnings of bonded premises of distilled spirits $2,300 for married persons filing plants tem designs . These designs will be Research) . employees were incorporated in . The study examined the jointly, plus another $600 for each evaluated by an independent con- Their work is carried out in close needs of both the Service and in . the Tax Reform Act of 1969. The additional old-age exemption to Developments in sultant from the standpoint of cost collaboration with the various offi . law permitting taxpayers to claim dustry with the view of devising a which these taxpayers are entitled . . In addition, as modern and streamlined system Tax Administration and performance, using advanced cials of the Service additional withholding exemptions An estimated 6 million persons will simulation techniques. The benefits requested by the Assistant Secre- because of large itemized deduc- compatible with good business take advantage of these new filing tary of the Treasury for Tax Policy, practices and sound governmental Other research activities in the associated with the alternatives will tions was liberalized making it requirements in calendar year past fiscal year have focused on also be determined, so that de- staff support is provided in devel- easier for them to adjust' their administration. 1970 . oping and evaluating proposed Departing from a tradition of three areas-providing assistance cisions regarding the implementa- income tax withholding to achieve The optional tax tables have to payers of annuities and pensions, tion of the new system including legislation . The Service played an a closer balance with their ex- more than 100 years, a recom- been expanded to include incomes questionnaire surveys of taxpayer important role in initiating several mend6tion was made that the Serv . equipment acquisition will be based pected tax liability . Employees, up to $10,000, thereby enabling reactions to certain tax returns, and on the best available information . provisions of the Tax Reform Act such as students, who anticipate ice discontinue basing warehouse more taxpayers now taking the compliance studies . of 1969 which were designed to no tax liability on their part time controls and records on the identi . standard deduction to use these fication of each barrel of spirits Assistance was given to the Civil The Taxpayer Compliance minimize overwithholding of tax employment earnings may now file tax tables instead of undertaking Service Commission in its imple- Measurement Program from wages, and to eliminate an affidavit with their employer by serial number . Instead, a lot the computation of tax. When the number system would be employed mentation of the new withholding The Service has the responsibil- millions of nontaxable returns from which will excuse them from with- standard deduction is increased to provisions for nearly I million an- low-income taxpayers . holding and from the necessity of and control would be on the basis ity to assure that programs to 13% in 1971 (and subsequentlyto nuitants. Special forms have been which it is committed are properly filing a tax return to obtain their of the number of barrels in each 15% in 1973), even more tax- drafted for use of annuitants and a refund of withheld taxes . lot and the average content of each payers, now itemizing their per- implemented to promote voluntary Improvements in handbook is being prepared to compliance. It is a continuing task Success was attained in author- barrel in the lot . This system has sonal deductions, will be able to cover the rules on taxation of an- Withholdin g izing extension of income tax been found to be feasible, and will take advantage of these optional to refine current efforts and shape nuities . A series of Treasury De- new programs to cope with shift- witholding, on a voluntary basis, to simplify recordkeeping and the tax tables . partment meetings was held with A study completed in the early physical storage and movement of ing tax administration workloads . Part of fiscal year 1970 showed annuity and pension payments . The The Tax Reform Act of 1969 per- annuity payers on problems in com' Tax Reform Act of 1969 requires barrels in bonded storage at con- mits the Service to compute in- plying with the new withholding It is vitally important to know how that the chief cause of overpay- siderable savings to both industry tax administration has performed ment of individual income taxes annuity and pension payers, at the come tax for more individuals than requests. request of the payee, to withhold and Government . Other proposals the previous law allowed. A revision in the past in order to establish was voluntary overwithholding of Two surveys of taxpayers reac- its future direction income tax beginning January 1, by the study group materially re- of the regulations to implement it tions to income tax return use are . The Taxpayer tax on wages . Voluntary overwith- duce the number of records and Compliance Measurement Program holding was the cause of overpay- 1971 . These individuals will have has been proposed . under way. In one, individual in . the option of paying their income reports required of the industry . (TCMP) was established in 1962 ment on 42 percent of the returns come tax return filers are being for this purpose . It is the major covered by the study, and ac. tax obligations on a current basis requested to give their reactions to in lieu of filing, and making pay- long-range scientific research pro- counted for 39 percent of the total the consolidation of, the Form 1040 gram of the Service, designed to amount of overpayment . Itemized ments on estimated tax . Efforts are and Form 1040A into one new also being made to effect other answer the basic questions about deductions contributed to over Form 1040 . Results of the survey Service programs, namely : How payments on 33 percent of the improvements in withholding. A will be used in revising the tax form udy of employer payroll systems well are taxpayers voluntarily com- for 1970. The other survey, still in plying With the tax law and, con- stand practices, nearing completion, .the preliminary stage, is a fact- is designed to develop basic infor- finding study on how well the sys- mation helpful in improving the tem of paying estimated individual income tax is working .

68 / Annual Report / Chapter Seven Planning Activities / 6 9

I versely, which segments of the tax- Planning-Programming- crease the effectiveness of audit Service Planning Starts with Although the number of returns Taxpayers Report New paying population are least compli- Budgeting System resources will be sought by this Projection of Workload Items will decrease temporarily, the trend ant? By determining types and investigation . Highs in Individual and Continues Analyses of One of the first steps in the de- toward more complex returns will sizes of errors, frequency of occur- continue . For example, individual Business Income for 196 8 rence, and taxpaying groups in . Major Service Program s velopment of the Service's plans for budget, allocation of manpower, returns with incomes over $10,000 Preliminary estimates for 1968, curring error, TCMP helps the The Service continued to con- Computerized Taxpayer will probably double by 1980, while Service channel its scarce re- and facilities is the projection of produced in the annual Statistics of duct a number of major analytical Assistance the major returns to be filed in those with income under $10,000 Income showed substantial gains in sources into programs aimed spe . studies as part of its Planning . are expected to decline 11 .6 mil- cifically at the noncompliant future years . These estimates are personal income and business re- Programming-Budgeting System projected in substantial detail so lion returns, or 21 percent . A simi- ceipts reported on returns filed in taxpayer. Because TCMP is a Integrated Data Retrieval let*, although less spectacular, (PPBS) in order to develop the System (IDRS ) that the most efficient use of all re- 1969 . continuing program, the Service most effective programs to meet trend is expected in corporation re- has an opportunity to evaluate its sources may be made . Individual taxpayers reported Service objectives. Alternatives are The Service continued a suc . The number of returns to be filed turns where smaller corporations adjusted gross income in excess of efforts at stemming noncompliance ~eing evaluated by comparing their cessful test in the Southwest Re . with assets under $50,000 will in- and encouraging voluntary com- is expected to decline .in calendar $554 billion (up 10 percent), which relative benefits and costs. Among gion of a system designed to years 1971 and 1972 . This is due crease by 185,000 returns, 28 per- resulted in taxable income of $352 pliance by noting taxpayer report- the most significant current PPBS provide immediate availability of cent, while those with assets be- ing characteristics before and principally to the Tax Reform Act billion after allowing for personal special studies are: information needed to respond to of 1969, which eliminated the re- tween $50,000 and $100,000 will exemptions and deductions. after implementing now policies . 1 . An evaluation of alternative taxpayer requests concerning their 6 rise by 269,000 returns, 37 per- In the business sector, almost TCMP information had a myriad quirement for about million in- methods for achieving the objec- returns or account status . An im- dividual taxpayers to file . By 1973, cent . $1 .7 trillion in business receipts of specific uses in 1970. These tives of the delinquent accounts portant aspect of the system is the natural increase will have com- The total returns workload is ex- (up 11 percent) were recorded by ranged from answering adminis- and returns programs. elimination of traditional paper . pensated for this drop and the pected to grow from 94 .5 million in corporate and noncorporate enti. trative inquiries on specific com- 2 . In-depth cost-benefit analy- work by using electronic computers 1960 to 113 .2 million in 1970, and pliance characteristics to forming number of tax returns is expected ties . Corporations accounted for ses to determine alternative ways to store and retrieve data. The end to continue growing through the is expected to reach 117.9 million $1 .4 trillion and showed net in . the total data bank for major ana . of correcting more tax returns with product is the same but taxpayer in 1975, and 130 .6 millionof in 1980 . $85 billion lytical studies . One of the most decade of the 1970's . come of . Partnerships small manpower increases. Alter- service is dramatically improved . Projections of some the major had net profit of more than $11 bil . important uses was in updating natives are being evaluated to cor- The system uses random access categoriesof returns areas follows: lion on business receipts of $81 and improving the computerized rect statutorily unallowable items computer files in a central lora- billion . Receipts of sole proprietors discriminant function formulae identified on individual returns tion connected to video-display exceeded $222 billion and net prof- employed to select tax returns for during regular code and edit inquiry stations in field offices to it reached almost $32 audit with a high potential for tax Selected Types of Returns Filed In 1969 and 1970 and Projected for 1975 and billion. processing. provide immediate availability nr 1980, by Calendar Yea r The table and chart which ac. change. This technique is based in data . Ultimately, a taxpayer will hp 3 . A special study of the tax- 11 n thnaumd,l company this section focus on the part on the idea that tax error pat- payer assistance and services able to visit a field office, question recent large increases in deductions terns in the volume of individual program to re-examine overall ob. the status of his account and re- itemized on individual income tax returns are identifiable . TCMP jectives in the areas of ru lings and ceive an answer within minutes by Type at Retu as Actual , Edionte, aIut, returns. In the 5-year period 1964- 1969 wo 1975 1980 1970Cinul a brings this idea to fruition by interpretations, forms and publi . video-display. The source of the 1968, deductions for State and identifying the return items with cations, printing and distribution data will be located many miles local income taxes, real estate which tax errors are frequently of tax forms, and taxpayer from the district office . The system Total Mum, ...... ------IID,9D5 IL%nl 117.931 130,565 15 .3 taxes, and home mortgage interest associated. education . includes provisions for prompt re- Individual, ...... 75, D82 -77,219 70 .673 87,681 have risen by 127 percent, 55 per. Another important use of TCMP trieval of information from returns 4 . A study of compliance char- AGI under $10,00) 1 ------_ 56 .029 55,101 44,997 43.456 -21. 1 cent, and almost 54 percent, re- data in 1970 was in a study to re- acteristics in employment tax which have been placed in storage . AGI U0,I)DO and ever. . . . ------19 .053 22. 1111 33,676 44 .225 100 .0 spectively. Over the longer period define the criteria used to classify accounting and withholding . It will be possible to get a written Corporation, total 1 .696 LTC) 2,055 2,427 39 . 5 1958-1968, the total amount of individual income tax returns for response to an inquiry on the date 5 . A study of Service organiza . forms 1120 and------1120 special, taxes deducted has more than audit . Classification is necessary to tion to analyze and evaluate the of receipt. This new technology will total. . . . . _._ ------1,460 Las 1,712 1 .995 34 . 3 tripled and interest paid deducted reduce the audit workload into long-range effectiveness of Service ultimately enable the Service to Assets under $50.000 -...... 636 734 837 28. 4 has almost tripled . more manageable groupings . The Assets 350 ' 000 unit, , structure . make immediate adjustments to all "' DOMINO. ~...... ----- 724 7M 85 1,002 36. 7 A I ist of Statistics of Income pub- data is readily processed by com- 6 . A field evaluation of Central- types of taxpayer master file Assets $ 000,DDO or hnore ._ 100 101 1253 156 54 . 5 lications released in the past year puter; therefore, each classifica- ized Telephone Taxpayer Service accounts . Farm, 1120-S and I IZ2...... 236 254 343 432 711 . 10 appears on page 106 . tion system can be tested and (Centiphone) . This study was de- Proposals for supplying neces . = .nt ...... 22 . 1092 ZLO74 24.364 M 14 4682 5 9 :9 ranked in terms of acceptability 75 239 372 signed to test the cost and effi- sary equipment for permanent in- L ;T, .p,t .,unuaait 381 417 51 3 61 0 46, 3 until the best solution is uncovered . stallation of the system in the s .u.. accup.ti'" a ------994622 08 1,024 1 .053 5 . 5 ciency of Centiphone on taxpayer E ------: ... 753 532 464 -38 . 4 others 9,746 S."411 10,398 11 .720 19 . 5 The Taxpayer Compliance Meas- service. In test districts, Centi- Southwest Region and all other -...... urement Program will continue in phone enables taxpayers from regions are under consideration . Data by size class ate estimated. future years to provide the Service every area within the district to call Current plans call for complete in- Based an most recent reports of returns filedarnalmler aliear estimated. needed information in the four stallation of the new system in the Includes .9 ..td eft.ts of the Tea Rotor. t .11969 .. a- 1040 beginning with return, filed in district headquarters without a 1971 and the Employment Security Amendments of 1970 which affect Form 940 retuns filed beginning In major areas of tax enforcement. toll charge. Southwest Region in 1971 and in 1972 . ~. additionto Forms 1114D.nd ID40A . Includes Form, 1040C, hit. PR, ndSS . 7. A major study is being under- remaining regions as soon as pos- , Iocludn form 1120 with assets not torNted . taken, with Treasury participation, sible thereafter. nclind. Far.. ID40ES 1065, ID41 . 7 , 2438 ..it 1042. to look at alternate audit strategies. Methods and procedures to in .

70 / Annual Report / Chapter Seven Planning Activities / 71 individual Income tax returns: Number of returns, personal deductions and exemption s This year increased use was Eleven States reported the addition The agreement signed with made of the tax models by various of approximately 31,000 nonfilers Rhode Island this year conforms to 11'. In . . . year, branches of the Service . With the to the tax rolls-due primarily to the model . Existing agreements passage of the Tax Reform Act of the use of data in tape form from with Idaho, Illinois, Minnesota, 1964 1965 _L:~~W 1969, the Service realized a need the Service's individual master file. Missouri, and Wisconsin were re- for estimates of total returns to be An even more fundamental ben- vised to reflect the wider scope of (Thousands) filed as well as num bar of returns efit of the cooperative program is cooperative activities. As the States All individual retuins...... _ . . . . . ___ 65,376 with balance due or refunds . Such the elimination of costly duplica- are able to expand the scope of 67,596 70, IA D 71,6~ 73,729 Standard deduction turn, I ...... forecasts help in determining work- tion in the detection of nonfilers, their cooperative activities, addi. 38,466 1 39,87242 hamized deduction rstums_. ._ _ 26,910 41,600 41 .877 tional revisions will be made to 7, 72 28.560 29,774 '28 load requirements, and in evaluat . the audit of erroneous returns, the Number of ...Ptl...... ing possible problems . Other uses location of delinquent taxpayers, existing agreements . 187,253 1 190,741 114.11 198, am 8 201,28 of tax models included : (1) operat- and similar activities . This contrib- (Million dollars) ing ratios relative to specific indus- utes to the efficiency of both Fed . Computerized Cooperation try groups to assist revenue agents eral and State governments and Tout personal deductions and examptlom;. . . . ------...... 179,342 1 195 To cope with the ever-rising .101 113.11 200,548 212,02 4 and tax auditors in screening and saves taxpayers from the incon- Aumme and, d volume of tax returns and other Announj o~ scarnp ;lon,;,~,,i ;~_ 112.352 . ------114,445 116 977 examining business returns ; and venience of separate axe inations 20.158 118,822 120 773 documents, nearly all tax adminis- Amount of Itemized deductions ------...... ------_------46 20,618 2154:820. 22,103 22; 074 (2) a review of returns showing re- by the two governmental levelsm . .832 50,739 566 59,623 69,177 trators have turned to the use of lt.mi . .d did .lUcims by type : funds to determine the adequacy of The principal forms of coopera- Taoin . total...... computers . Their use in the ex- 14,071 17,469 24,360 the withholding tables. tion are . change of tax return information Rai instin' I 61 D50 The 1968 tax models, now in 1 . Formal agreements StateOut., and 1-1. .locorn"11.. . . 7 ...... _ ...... 7,316 322 under the Federal-State Coopera- uses . ~ ...... 2,962 4,065 68,:499 preparation will more effectively 2 . Exchange of computer tapes ; 5,158 61 MG tive Program has proved to be one 481 utilize computer capacity and re- 3 . Cooperative audits ; an d Intisnot Paid, total...... 12,457 of the most effective tools at the 14,97 1 Not 18.54 5 quire little or no special preparation 4. Training and statistical as- Home in, . . inl. ... I ...... tax administrator's disposal . To 6 391 8,142 tabulated Id ...... 6 : 066 9,822 of the data files before use . sistance . 6 .830 8,72 3 assist in developing mutually Contribullons .. ._ ...... helpful tax exchange programs, a Medical and dental expenses ' 327 131., Other dd 4,7 : 095 7:61' Increase in Formal Agreements .,Unn, ...... I . . ------...... ------.. . I 882 4 survey of computers used by the 5, 61.21 6,647 Maximizing Federal and A general benchmark of the co- States was made . The tax depart- I Includes riturns Ith . adjusted gross Income. State Tax Administration operative program is the number of ments of all States and the District Through Cooperation agreements on coordination of tax of Columbia reported that they now Percent Change in Deductions Itemized administration concluded with the use computers to process returns . on Federal Individual Income Tax The Federal and State govern- States . The map on page 75 indi- All but one store data on magnetic Returns (1958-1968) ments share the objective of obtain- cates the 45 States and the District tape . This survey indicates that in The Tax Models in 1970 ing maximum compliance with their of Columbia with whom the-Service the near future the bulk of tax pe tax laws with the least cost and in- had agreements in force at the end information exchanged between Originally developed 7 years ago convenience to the taxpayers . 6f the fiscal year-the State of the Service and the States will be to meet the Treasury's need for One of the important contribu- Rhode Island having been added handled by computers . timely estimates of the revenue ef. tions toward this end is being to the list this year. One of the most impressive de- fect of proposed tax legislation, the achieved with increasing benefits Over the years the program has velopments in the program has individual and corporation tax through direct cooperation between been extended beyond the original been the furnishing of selected models have proved to be valuable governmental agencies . Since there arrangements for the physical in- standard data elements from the tools for economic planning . is no formal statistical reporting spection of returns and the manual Service's individual master file to These models use generalized system, these benefits cannot be exchange of audit information. To State tax administrators . Thlity computer programs in conjunction measured with precision. However, reflect this broader scope and the States and the District of Colum- with specially prepared magnetic an indication can be obtained from application of computer technology bia received such data from 1968 tape files containing randomly se- incomplete data from 24 States . to tax administration, a model tax year returns. Since its incep- lected samples of taxpayer records . During the 18-month period agreement has been prepared for tion in 1967, the number of Federal The models are capable of measur . from January 1968 through June use as a guide in revising existing returns involved in, this IMF tape ing the effects of tax law changes 1969, these States estimated that agreements or the drafting of new program has included almost 60 and projecting the results to repre- $43 million in additional assess- ones. This model agreement pro- percent of the total number filed sent the entire taxpayer population . ments were attributable to infor- vides for optimum cooperation be- with the Service. During consideration of the Tax mation received from the Service . tween the Service and the States in Reform Act of 1969, the 1967 in. such activities as audits, training dividual tax model was used to pro- of personnel, taxpayer assistance ject and forecast the effect of many service, statistical services, and provisions of that law . Tax model ot her methods and processes to tabulations provided data on the improve tax administration . Pre . classes of taxpayers affected, the cautions to avoid unauthorized dis- revenue effect, and the workload closure of tax return information requirements of the Service . 1962 1964 196 8 are contained in the model draft. lamorn. your NOTM (1) (Inurissfi thl* period, there Ware major changes In the tax Revenue Act of 1 64, Which leave especially the of deductions siff-Ahod the an,mearmt of dandficti... reported. (2) Data an types am tabulated only for annin-numberad years.

72 / Annual Report / Chapter Seven Planning Activities / 73 Cooperative Audits Since this program provides an returns for contributions paid economical and effective means for under State unemployment tax One of the expanding coopera- both the State and Federal Govern- laws. The new system will effect tive activities which has proved ment to increase audit coverage substantial cost savings over the beneficial for both the Service and and minimize duplicate audits, the existing manual procedure under the participating States is the co- Service is taking positive action to which about 1 .6 million return operative audit program, in opera- . Under this extend it to all States where such schedules are shipoed annually to tion in six States a program is feasible . State agencies fol- verification and program, the cooperating State de- then shipped -back to Internal Rev- votes a significant portion of its Automated Certification of Credit enue Service Centers for manual audit activity to performing audits for State Unemployment Tax recomputation of any Federal tax of the State returns of taxpayers Contributions adjustment. Under the computer- whose Federal returns cannot be ized system, the Service will ex- Federal-State Tax Coordination Agreements audited by the Service because of Developmental work is under . The results way on a computerized system for change sets of data elements on and Income Tax Tape Exchange limited audit resources tape with the States. These tape of a State audit are used by the certification by State unemploy- listings will permit the Service to Service in making additional ment insurance agencies of the compute automatically any Federal assessments on Federal returns ; credit which employers claim on tax adjustment resulting from an in . audit results of the Service are their Federal unemployment ta x correct credit claimed by an em . similarly transmitted to the States ployer . I for their use in adjusting assess- ments on State returns . Thus, both Federal and State revenues benefit . Number of Individual Income Tax Returns from which Selected Information was Furnished to States in Tape Form (for Tax,Years 1966, 1967, and 1968) Numbef to States (in millions ) Training and Statistical Assistance Total rtums filed (in millions) T 73 .7 During the year, 61 tax official s 70.2 71 .7 from 26 States, the District of Co- lumbia, and Puerto Rico attended training classes conducted by the Service. Training materials, includ- ing correspondence courses and classroom kits and instructors' manuals, were furnished seven 43. 6 States . Special statistical studies 39 .9 39. 4 also are furnished to the States within the limits of available facili- ties.

57% 55% 59%

196G 1967 ,968

74 / Annual Report / Chapter Seven 4M-961 o - 71 - 6 Management Activities Personnel Policies Prove Successful ADP Redeployment Program Completed Utilization of the Handicapped and Blind Continued Training Fitted to Needs of the Service Internal Operations Monitored Man-years authorized and realized Personnel Summary The Service negotiated cooperative Financial Management work-study agreements with 80 Authorized ealized Meets Budgetary 111=1 schools, bringing total agreements fil-fmas-lind Number a . mile Challenges Appropriation Location and type at clos, .1 Year to 210 . This prograr; enables the 1969 am m Service to interest high quality stu . Financial resources were IL-Lf 0 a 1969 = 1969 1970 . Funds dents in tax work while they are strained in fiscal year Salaries and expresses- completing their accounting study. planned for specific programs had coroplumcRevenue .-Ming...... '91m, g:= Service, total ...... 66 .064 ".M 64,50 7 . . ---- 42.407 u .M Last year the Service retained 74 to be used for unanticipated cost P irmament...... 562 57,742 41~25...... 66,872. a M Temporary ------:,-, :... . 578 : 50Z 7.72' s 6 .76 5 . .m percent of the students in the pro . increases of the mandatory variety, Increase. .1970.. . . over. . . . .1969...... ------...... ------+2 ;m ., printing, telecommunications, "-. I-I r--e a National Office ...... 3 .gs2 14'gro 3,793 gram as full time employees . Par . i .e Field urvice, total ------62,20 2 U.M . ..7 travel per them rate, employers re- 60,714 ticular efforts are being made to Data processing, total ------__ . . . . ",an enlist minority schools in this tirement contribution . To meet Of the total savings realized, their service . To alleviate the situ- 21,50 3 19,60 3 Collection, total ------program . these requirements the Service was $6 .3 million is attributable to 14 ation, the Service requested higher 10,08 1 10,105 U.60 forced to severely restrict purchas . entrance salaries for these posi- R anvenue officers . . .-----...... 5 .945 4rd" 5,853 Service-wide projects, many of Other. . . ------4, 23G G. M ing, training and travel . Recruit- which are described elsewhere in tions. The U .S. Civil Service Com- I 6= 4,252 Job Enrichment Audit . total------ment was restricted by overall Gov . this report; $4 .4 million accrued mission approved special New 20,248 ,- 20,496 Experiment Complete d ernment limitations during the last from continuing management pro- York City salary rates. Revenue agent,. . . . . ------_ 12,767 12 ;113 0 12,531 32.1,12 The Service completed an experi- Offi-ii,ill.-nd to. technicians...... 2,869 -2- half of the fiscal year . The ceiling grams such as reports and rec- Other I ...... ------4,612 51:701,1 mental application of Mr . Frederick for permanent employment was ords; and $6 million from mis- Assessment Center Experiment Intelligence, total_...... 2,293 Herzberg's job enrichment motiva- 30 employment 2,310 61,442 and June cellaneous improvements imple- Special agent, ...... tional theory. In brief, the theory was 152 under the ceiling . The re- . The initial results of the Serv- Other ...... -I, sso I .M 1,673 1.15`1 mented throughout the Service ice's experiment with the Assess- 609 " a 637 a " states that once "hygiene" factors, strictions seriously jeopardized the The Incentive Awards program Alcohol and tobacco tax, total ------2,639 2,1511 2,712 3 .M such as pay and working condi. Service's abilityto fulfill its mission ment Center technique proved en- was responsible for approximately couraging . This advanced selection !~.,~Plafig.hrs ...... - 1,045 1,090 1 ;242 tions, are taken care of, real moti- and resulted in the loss of revenue $1 .2 million in tangible savings . 'rapect-g...'al------399 39; 389 -3s, vation comes from the content of technique was adopted from a Bell OOnpect. .c.-m Plan' irs,------409 eads 395 - from principal compliance pro- Adopted employee suggestions ...... 786 "a 838 222 the work itself. A selected group grams . 320 specia l Telephone System prototype appli- numbered 1,200 and cation . It provides an objective look Appellate, total_ ...... _...... 1 .52 2 I ;m l, s w 1 .470 of tax-examiner positions in the De . Careful management enabled the achievement award s were granted . ttroit Data Center were subjected to at candidates for supervisory posl- A gall to of.. . as ------6 6 as i, 64 7 . an Service to conduct operations with- The sixth annual Treasury Awards A.' ltris ...... __ 14 6 --- Us his experiment . Over a 6-month out overexpending . $879 .1 million tions during a 2-day series of simu- Other . . ------70 7 85 7 7111 period several changes were made Ceremony recognized 41 Service lated work situations, group exer- of the total authorization of $881 .4 employees. Administration, district office ------33 1,M in the way the jobs of the selected 30. cises, and interviews. The Assess- Administration, regional theadquarters .11...... 1 .689104 't- M 1'692 3 872 million was obligated as ofJune Rnelf I onV. counsel ...... 759 732 769 '?12 participants were done. The Of the $2 .3 million unobligated bal- ment Center proved to be a valu- egio inspection . ------__ 663 .-M 669 717 Successful Recruitment Efforts able adjunct to traditional methods changes were intended to make ance, $1 .5 million was reserved to jobs more meaningful and satisfy- . With this Despite hiring restrictions, fis- of evaluation and selection of per- I Includes terminal leave man-years for entire Service . offset pay act increases includes Office of international Operations National computer Center and IRS Data Cent ., . ing to the employees . amount excluded, the Service was cal year 1970 was a successful re- sonnel, and was used in selecting includes cry mplay. .. hired locally i2 in 1970 and 3 in 1969). Results the 1970 Executive Development of the experiment will be brought within one-tenth of 1 per- cruitment year in terms of the reviewed to determine the extent cent of employing all money avail- Service's ability to attract quality Program participants. recruits . Recruiters exceeded ex- Several significant developments A major product of this study changes affected productivity and able. resulted from this study . For ex. perceived job satisfaction . Follow. For more detail by appropriation, pectations in filling positions au- Completion of was a profile of the types of indi. . ample, a new semi-technical occu . viduals who tend to meike good ing analysis of data, decisions will by activity and also obligations thorized after the close of the Revenue Officer be made as to how job enrichment 1968-69 school year . A signifi- pation of revenue representative is revenue officers and who remain by districts, regions, and National Occupational Study being established and persons in with the Service. Guidance will be principles can be further applied. Office, see tables 26 and 27 on cant element in the successful hir- this occupation will perform a large ing effort was advertising placed An intensive study of the reve- given to recruiters on potential re- pages 135 and 136 . nue officer occupation was com- portion of the lower-graded work cruitment sources for these indi- Restructuring the Inspector in newspapers and professional . The study, which now assigned to revenue officers. Occupation in journals. pleted in January viduals. Finally an awareness was Service Exceeds Savings began in 1967, covered all major Another product of the study was gained for expanding revenue offi- Alcohol Activities Goal by $1 .7 Millio n Hiring in Alcohol, Tobacco and Firearms and Intelligence Activities aspects of field collection work : a set of recommendations to the cer career opportunities . An effort After a comprehensive study, the The Service established a sav- the appropriate division of work Civil Service Commission for re- in this direction will soon begin reached an all time high . Recruits . Service decided to restructure the ings goal of $15 million for fiscal were needed to replace investi- between office and field branches ; vision of the general and special work of Inspectors (General) and year 1970. The savings realized- gators selected for the Organized rade level of work; and the ex- experience requirements in the Increase in Cooperative Inspectors (On-Premises) to in. $16,736,000-is within $50,000 Crime Drive Program and to meet 'perienceg and education needed to revenue officer qualification stand- Work-Study crease operational efficiency . This of the record high savings re- the workload resulting from fire- perform the work. A close examina- ards. The study revealed a chang- Participation Continues restructuring is based on three $11 million ti on was made of hazards in the ing emphasis towards higher- ported in 1968 . Over arms legislation. Participation in the Cooperative principal ideas . First, low level cus- in savings will accrue in 1971 and critical shortage of account . revenue officer occupation, the graded work . A number of new GS- todial duties in the current In. from cost reduction and A 11 and GS-12 revenue officer po- Work-Study Program for college 1972 ants was encountered in filling reasons for separations, and the students majoring in accounting Spector (On-Premises) job will be management improvements imple . Revenue Agent, Internal Auditor, career opportunities for revenue sitions have been created in recog- brought together in a new position nition of this change . reached a new peak during cal- mented in 1970 . and Special Agent positions in New officers . endar year 1969 when 388 student entitled Plant Officer . Second, audit York City . Competitors were gen- trainees served under the program . and inspection duties inherent in erally offering higher salaries for Inspector (On-Premises) and In .

78 / Annual Report / Chapter Eight Management Activities / 79 Much of the success of the pro- ployment opportunities are most Another new development Ahat the opportunity to advance in the Spector (General) positions will be often drastically restricted by lack job . Finally, a gram must be attributed to the em . is expected to have Service-wide statistical field . Trainee positions combined into one ployees aftected, because of their of employer understanding of their impact took place in June when were established at lower grade new position, operations Analyst, work potential-the blind, the will be created to encompass only excellent cooperation throughout Mrs . Barbara Vatran Thompson levels, allowing the Service to hire deaf, the mentally retarded and was appointed as the first Service . the most difficult inspection work. the conversion. inexperienced employees whocould the mentally restofed . " wide coordinator for the Federal be trained to qualify for higher Restructuring is designed to recog, Mr. Hampton praised the De- nize the increased complexity Of Labor-Management Relation s Women's Program . Mrs. Thomp- grade positions . This created a ca . tro it Data Center 'to r the deaf it son will also serve on the Treas- reer ladder of grades beginning at certain inspections, new program The year's most significant event has employed as card punch Op . emphasis, and additional duties ury's committee dealing with the GS-2, with grade levels up through in the area of labor-management er tors. Special mention was made special concerns of women . grade 9 . The establishment of lower and responsibilities which have relations came when President of the record established over the The Southwest Region conduct- arisen over the last decade . grade statistical clerks opened the Nixon issued Executive Order years by the Southwest Service ed a series of seminars for exami- opportunity for file clerks to be re- 11491 in October 1969 . A key fea . Service Successfully Completes Center in Austin in hiring the deaf, nation of relationships between assigned to statistical work . Of the ture of the Executive Order is the persons with other severe physical Redeployment Program ethnic groups . Participants have 19 employees enrolled at the ADP application of the third-party con- impairments, and the mentally re- been extremely enthusiastic about trainee level, one has progressed to In March 1959, the Service be. cept to unit and election questions, tarded . The Southwest Service the seminars, and attest that the and to disputes between manage- a supervisory position and all have gan a conversion from manual to Center had been previously recog- openness and candor developed been promoted to higher grades. automatic processing of tax re- ment and labor organizations. nized by the Commission and the during the discussions gave them An interesting and timely project The Service was highly organized turns . This decision committed the President's Committee on Employ- a new perspective on relationships sponsored by the Service gave Service to staffing and training before the new Executive Order was ment of the Handicapped . Mr. between ethnic groups . Participa- young male students in the District service center organizations total- issued . More than 47,000 of its to- Hampton also paid tribute to the .tion in the seminar was voluntary employees are in exclu . of Columbia a chance to observe ing 14,000 permanent employees, tal 66,630 effort made by the North-Atlantic Kathy Sanders Is a highly efficient and involved Blacks, Indians, Mex- successful men (representing mi- primarily in job categories practi- sively represented units . Service Center, in cooperation with taxpayer -sister. Blind since birth, she ican-Americans, and whites . Super. nority groups) at work . It re- The trend toward formalizing the was train d by the Little Rmk. Ark. . Each youth cally unknown to the Service the Veterans Administration Hos- Enterpris: . for the Blind visor participation added another labor-management relationship . She uses a spent a day with a Service em . quired the phaseout of work in the pital, Bedford, Mass ., in providing braille slate and stylus for taking down dimension dealing with the impact ployee who shared his regular daily district offices affecting approxi- with written agreements has con- questions to be answered and an abacus counseling, training, work experi- for her computation . of supervisory attitudes and be- work activities with the student . mately 12,000 permanent em. tinued . Almost 19,000 employees ence and employment for mentally havior on relationships between Such programs help interested ployees in the returns processing (some 40 percent of those orga- restored patients . ethnic groups . young men become familiar with . The Serv- nized) are now covered by negoti- and accounting function Chairman Hampton also made Equal Opportunity the world of work and recognize the ice decided to avoid layoffs and de . ated agreements . Negotiations cov . special note of the cooperative ar- Developments Assistance in Communities need to stay in school to achieve veloped a program with the pri- ering 5,300 employees were in rangement with the Arkansas En- Recruiting, training, upgrading, A new free school for ethnic success . mary goal of minimizing hardships progress, or about to begin at the terprises for the Blind, therein group students desiring tutoring in to employees working in the af- end of the year. carefully selected blind candidates and assistance activities are com- ponents of the Service's Equal basic English and typing received fected functions . The Service responsetothis high for professional employment are assistance from the Service in Commissioner States To accomplish the objective, the level of activity has been to expand trained and successfully employed Employment Opportunity Program . The development of the Coun . Santa Ana, Calif. The school had 46 Training Guidelines Service planned and developed a the training given personnel spe- as Taxpayer Service Representa- pupils-the oldest 50 and the "Redeployment Program ." This in- cialist, management negotiators, tives . This program received na- selor Program has done much to reduce disharmony. The job of an youngest 13 years of age . The plan Three broad guidelines were set cluded reassignments within a dis. and others concerned with the pro- tional attention during last year's features voluntary tutors, mostly for the Service's training effort for trict office or to a service center, gram . Increased technical assist- Conference on Employment of the Equal Employment Opportunity fiscal year 1970 : counselor is to establish an open from the Service, and is sanctioned transfer to other Federal agencies, ance on labor relations matters has Blind, sponsored by the Civil Serv- under an Executive Order . The tu- 1 . Implement new and broader retirements, resignations to accept also been made available to field ice Commission, the Department and sympathetic channel through which employees may raise ques- toring makes participants more recruitment and training efforts in suitable employment outside the offices. of Health, Education, and Welfare, employable; gives them confidence, a tight labor market, to attract and Federal Service, and in short, any and other agencies . Ten students tions, discuss grievances, find an- swers and (on an informal basis) and makes them aware that the prepare capable employees. voluntary solution to the placement Service Commended entered a new class in June at Lit . Service is truly an "equal oppor . 2 . Encourage incumbent em . problem caused by the conversion for Utilizing Handicapped tle Rock where Taxpayer Service get resolutions of problems con . nected with equal employment op . tunity employer" . ployees to gain better skills for ad . to ADP. To assist the program, There is no need to embellish Representatives are trained . At The Service worked with fair vancement to higher technical and numerous special placement au- the words of Civil Service Com- year's end, 40 successful blind portunity. A counselor serves as supervisory positions. a bridge between employees and housing organizations in Philadel- thorities were negotiated with the mission Chairman Robert E. Hamp- Taxpayer Service Representatives phia, in neighboring communities, 3 . Recognize and meet the chal . . management . Before any com- Civil Service Commission ton, written in April to the Service were at work in 26 States, fur- and with the city transit company lenges and crises of a changing Of 12,000 permanent em . about its program to employ the thering the Service's 3-year goal plaints can be filed, a counselor to increase housing opportunities society . ployees 11,000 were redeployed handicapped . He referred to " . . . of hiring at least one blind Tax- must be consulted . A counselor for minority employees and to se- with no adverse actions or involun . the fine job the Internal Revenue payer Service Representative in cannot delay a complaint since he cure extension of the city's transit tary transfers. The work involving every major office. must act within 15 days . After im- Service has been doing in sup- plementation of this procedure, the routes at the time of relocation of public assistance and information porting Executive Branch policy the Mid-Atlantic Service Center. duties performed by the manual number of formal COT p I aints of for employment of the handi- discrimination dropped markedly processing work force remained in capped ." He also indicated that the . Upward Mobility-a Reality the districts and provided positions . . Commission had been especially The Service's Statistics Division forthe remaining 1,000employees impressed with the Service's "ef- has a career program designed to forts to employ those whose am- give lower grade clerical employees

80 Annual Report / Chapter Eight Management Activities / 81 in equal employment opportunity, program, Teaching Taxes, provides established for State and local po . Security of Internal Revenue New Telecommunications Recruitment and Training an important base for the kinds of lice agencies, in firearms as well of New Employees- hiring and utilizing the handi- Installations Strengthene d Developments capped, and negotiation with em- activities necessary to meet this as other law enforcement. subjects . Contacts with Educators challenge. This free program, Regional and local semi During the past year the nation In fiscal year 1970, the Service ployee unions. nars were experienced an increase in social A series of seminars for college aimed at the high school level, conducted to inform police officers sent and received more information unrest, marked by protest demon- than ever before by telephone, tele- and university professors of ac- Managerial Training reached a large number of stu- of the provisions of the law . In counting and taxation helped open dents . In 1970, requests for ma . February 1970, the Service con- strations ranging from peaceful and graph and other electrical and elec. communication between the Serv . Programs concerned with spe- terials totalled over 3 .6 million ducted a 2-week investigator train . orderly rallies to those of a violent tromagnetic communications me. ice and the academic community. cific job problems and situations general student texts, 460,000 ing program in Tallahassee, for the nature involving personal injury dia . Extensive efforts were devoted by as well as generalized managemeni 95, and destruction of property. Recog- to exploring greater use of new and Valuable contacts were made farm texts, and approximately Florida Beverage Department . nizing the need to devote more employing professors during leave training, were provided for man- 000 teacher's guides . These ma . more sophisticated types of equip . from their academic duties . These agers . Formal training was com- terials provided students with an attention to a basic protection ment while attempting to keep tele . individuals worked in the field of bined with assignments as acting explanation of what the tax struc- Expansion and program, the Service took steps to communications cost as low as pos- their academic specialty to ap- ,managers to build managerial skill ture is designed to accomplish and increase protection of facilities . sible . This year's efforts resulted in Improvement of Facilities Protection was strengthened at ply expertise to various problems and an awareness of the responsi- how it works . Students were fur- new telephone usage guidelines for in training and utilization of bilities involved . Service managers nished sufficient information to and Equipmen t the key data processing facilities by revenue agents, expanded tele- initiating more stringent methods employees . acted as instructors to make the assist in preparation of tax returns Phone equipment systems for tax- formal training more realistic . of preventing entry by unauthorized Payer service, and a teletype sys- for parents or friends . Progress o n persons Skills Development To provide similar coverage of Service Center Space ; improving the early warn- tem for access to National Crime opportunitie s Executive Developmen t business filing requirements, a ing fire detection systems ; provid- Information Center data . Extensive negotiations and much ing additional guards ; establishing In a cooperative program with pilot Teaching Business Taxes pro- The Executive Development Pro- effort were devoted to designing close liaison with U .S. attorneys Gains in Records Management the Labor Department, the Service gram provided participants with gram was launched at the fresh- and getting approval of three new and State and local law enforce- is providing opportunities for dis- the broadening experiences and man and sophomore college levels service centers . Lease awards for An active records disposal pro dealing with individual ownership, ment officials; and complet i ng other . advantaged citizens to learn mar. training needed to equip them for the Fresno, Calif ., and Memphis, related actions . gram released space and equip . . Those who success . future roles as assistant district partnership, and simple corpora- Tenn . locations were made before ment valued at $1,406,000 for .ketable skills . The Service issued guidelines for fully complete training programs and service center directors . Par. tion tax problems the end of the year . Responses to handling demonstrations at service productive reuse by the Service . Al . are guaranteed employment and ticipants visited regional, district the Suffolk County, Long Island, so . locations by various protest groups . though total records holdings in . the chance for self-betterment . Tar. and service center offices in small Training of Alcohol, licitation were satisfactory . Present Over 100 such demonstrations took creased slightly in 1969, a regional get positions for which' *specific groups to learn about management Tobacco and Firearms schedules call for completion of the place in 38 States, most of them test on sending 1969 individual training was given include : Data activities and to gain familiarity Special Investigators Fresno Center in October 1971, the on April 15 . tax returns to a Federal Records Transcriber, Tax Examiner, and with operations . A new feature of Increased staffing and expanded Memphis Center in December Guidelines were also issued for Center 6 weeks after receipt by the Clerk . this year's program was the intro- responsibilities have necessitated 1971, and the Suffolk County Cen- handling bomb threats. During the Service Center is promising . Test duction of an electronic data proc- revamping the alcohol, tobacco ter in July 1972 . last half of-fiscal year 1970, there goals are to alleviate critical serv . Training for Recruits essing seminar to show partici . and firearms law enforcement were 102 bomb threats to Service ice center space problems and The Service is concerned with 'pants the capability of a data training program . Mandatory train- Office Surroundings Improve d installations . Although n destruc- make maximum use of the records reference service of the Federal providing the best possible training processing system and its influ- ing adjustments have been predi- For some years, the Service has tive devices were found, evacuating0 ence upon the relationship between employees from buildings resulted Records Center . for new employees and for those cated by technological change been striving to improve the physi . changing to new occupations within district and service center opera- advancements in the field of ord- in a significant loss of work time. cal conditions of its offices. At FForms and the Service . For example, newly tions. nance and weaponry, and changes Prompt steps were taken to times employees worked in less orm Letters Reduce recruited Trial Attorneys were intro- in criminal behavioral patterns . than adequate surroundings, but strengthen the security of firearms d seized by Alcohol, Tobacco and duced to their duties in the enforce . Reading in Management To satisfy these,needs, an inten- now most are in new or substanti . The combined efforts of Na- tax laws . Trainees sive incumbent investigator train- ally refurbished space Firearms personnel under the Gun vonal, district, and service center ment of Selected articles and readings . Pro- Control Act of 1968 . The Service is discussed the preparation of cases were distributed periodically under ing program was initiated Progress has been 'made in two employees yielded significant prog . grams were designed primarily to obligated to protect these weapons and analysis of evidence . Through the "Readings in Management" problem areas-the Chicago Dis- from both deterioration and theft ress in reducing the inventory of provide a professional supplement trict Headquarters Office and the forms and form letters by 1,039 mock court trials and the use of program as part of the continuing until final disposition is determined video-taped sessions, each student development of supervisors and to the law enforcement training re- Detroit Data Center . With the Gen . or 6 .8 percent . The following table ceived by each newly-appointed by the courts . was able to observe and eval . managers . This program provided eral Services Administration's close summarizes this year's forms man . uate his own performance and an opportunity for incumbents to special investigator . cooperation, success was attained agement activities: was assisted in correcting his read the latest theories and ideas The Service incurred an addi- in these two cities. The Chicago tional training obligation under the Forms and form letters errors . in a broad range of topics . District will be in renovated, air. objectives of the Gun Control Act of conditioned, modern office quarters 1968, particularly as to Title 1, by the middle of fiscal year 1971 N . closing goir. Supervisory Trainin g Taxpayer Education wherein the Congress declared its presented by open", . .Py rated Net Expands Coverage and the Data Center is in the proc. 101, .,ad "b" Wry The Service provided special su- intent to provide assistance to Fed- ess of making a temporary move in- Tohl__ ------pervisory training in addition to the Taxpayer Education continually eral, State, and local law enforce . to a modern building outside the ...... 15,367 1 111 1 117 11 11 , basic supervisory courses required faces the problem of keeping pace ment officials in their fight city limits. The Data Center will re- NatWral Office(used at headquartois and 2-1co-wide). , 6,084 620 466 6 .238 + 154 the Civil Service Commission . with changing laws and a chang- Fissional offices (used bl feipona, headquarters com - by gainst crime and violence . In- turn to the city when a suitable ponents or 2 or more i , tric t offi ces). . . ii...... - 61395 440 1,436 5,399 -990 Supervisors confronted with spe- ing society . The largest Service building is constructed . Distr~ctordire Qtffic&(0 offi Uused by lots districts an their lub. ervice training programs were ...... 75 5 199 244 710 -45 cial situations were given training S .1111. cant-_! ...... 1 .945 Data cents, ...... 558 731 1, 772 -172 188 41 20 209 +21

82 / Annual Report / Chapter Eight Management Activities / 83 tiveness of operations . Manage- placed on those directly related to Refund Schemers Thwarted Accident Prevention . The Attempted Bribery Program A vice-president of a wig man . on Target ment officials are furnished facts the collection of tax and enforce- Internal auditors uncovered sev- is illustrated on the following graph . and data developed through inter- ment of tax laws, these being the ufacturing firm in Ohio offered a Due to one incident in calendar eral false refund schemes during Each bar on this graph shows the Service employee $1,500 for a fa . nal audits and investigations for areas most susceptible to breaches the fiscal year . One case involved number of attempted briberies rse . vorable audit , year 1969 when 29 persons were evaluation and use in taking cor- of integrity . Data processing activi- ported temporarily disabled bytoxicfumes the use of special com puter prb- by employees; the shaded Investigation is continuing into rective actions. Evidence of a vio- ties at the seven regional service grams to identify 143 persons who subsection shows the number of from a ventilation system malfunc- centers are examined on a continu- attempted penetration of the Serv . lation of Federal criminal law is claimed $180,000 in fraudulent arrests or indictments each year ice by members of tion, the Service slipped from its furnished to the Department of ing basis. resulting from these reports organized crime . record low personal injury rate for refunds . The practitioner who pre- . During January and February of Justice for determination of pros- Management's actions on re- pared the returns was also identi- this year 17 the previous year . The Service was ecutive potential. ported deficiencies or problems re- persons were arrested nevertheless able to maintain the fied . In another case, internal audi . in New York . Eight were prominent sult in significant improvements in tors, working with service center 31 percent improvement achieved programs, procedures, and con- figures of organized crime. Two of since the start of the goverriment- . The results of these actions personnel, identified 838 returns Attempted Bribery Program the eight were recently the subjects trols showing apparent fraudulent re- of wide Mission SAFETY-70 . The are often measurable in terms of I newspaper publicity in the Now campaign is designed to reduce their impact on revenue or on sav- funds of over $235,000 . Substan . York area . Nicholas Ratenni took the number of injuries and costs tially all of the 838 returns were the Fifth Amendment 19 times at ings of manpower or other re- detected early enough to prevent by 34 percent by the end of cal- 6 2 50 a hearing before the State Commis . sources. It is estimated that actual issuance of the refunds . endar year 1970. The Service has or potential additional revenue and sion of Investigation into under. every hope of meeting this goal . wo rid ties with Yonker's City Offi. savings during fiscal year 1970 ex- 6 10 46 Service personnel operated mo- ceeded $31 .5 million. Proper Staffing Vital 1 cials . John Masiello, Sr., and his tor vehicles for 106 million miles One example of program im- to the Service son, John, Jr ., were convicted of 6`1 on official business during calen- provement was to increase the ex- The integrity and effectiveness i s 61 bribing postal employees and have dar year 1969 with only 689 acci- tent of verification of excess social of the service is protected been indicted in connection with a by : Plot to have John, Jr dents . Less than seven accidents security tax withheld, claimed as -Hiring the right persons. 65 1 7 0 ., deferred per million miles driven established refunds on individual income tax -Protecting employees from peo. from the draft. the lowest rate on record . A sig- returns . This action will save an ple who would seek to have them Internal Security and Internal 6 6 16 80 nificant portion of the improve- estimated additional $4 million in misuse their positions . Audit teams pool their efforts in ment can be attributed to benefits refunds of erroneously claimed the investigation of actual or po. -Identification and removal of tential frauds derived by employees complet- amounts. those who choose not to resist 67 120 by employees or ing training courses in defensive In the review of closed audit ex. temptation . through collusion between em . ployees and taxpayers, This effec driving. aminations in one district office, The Internal Security Division 6 8 3 2 10 5 . The Service acted on 108 claims internal auditors found that sub- does this by investigating appli- tive cooperation can be seen in under the Military Personnel and stantial payments refunded to tax- the trial of Norman H . Egenberg, Assistant IRS Commissioner (inspection) cants to weed out poor risks and 69 4 3 100 Civilian Employees' Claims Act of Vernon D . Acres accepts the Nations[ payers underspecial insurance pro- by investigating irreg,,ulariliS:srvic or CPA, recently concluded in New 1964 settling 65 claims in favor Civil Somico League' . 1970 Career Service grams of one insurance company complaints which involve York City . After an extensive Serv. Award. The award is granted for nvestigation, Egenberg was in of employees who suffered per- efficiency, conscientiousness, originality were not being properly reported by employees. Included in their activ . 70 83 . sonal property losses incident to end sheer weight of performance. the taxpayers . Follow-up examina- ities are the investigations of per- i'Cted on 88 counts of bribery, their employment . This is an in- tions to date, in this and other dis- sons outside the Service who false statements and aiding and 11_~~ abetting in the preparation of false crease of 30 percent over the num- tricts, have resulted in proposed attempt to corrupt Service employ- lenerig .ti.r . initiated ber of claims handled last year . internal Audit Maintains additional assessments of more alien tax returns . His trial ended Vigilance Over ees through bribery or other means . than $1 .7 million . Since January 1, 1961, a total on June 25, 1970, resulting in con- Service Program s viction on 25 counts. The trial was The recent criminal conviction of of 744 Service employees have re- The Best Laid Schemes Inspection Programs The Internal Audit Division, as a taxpayer for willful failure to file ported what they believe to have highlighted by the testimony of of Mice and Me n Strive To Assure an integral part of the management income tax returns was the culmi- been attempts made by various many prominent personalities . The Public Confidence control system, has the responsi- nation of an investigation origi- persons to bribe them . These re- Persons who attempt to corrupt re-alidits of Egenberg and his bility for determining that controls nated by an internal audit referral . ports have been turned in not only Service personnel come from a clients have resulted in proposed in Tax Syste m established over the operations of Internal auditors found that al- by tax collectors and employees variety of locations and occupa . defic iencies including penalty and the Service are efficient and effec- though the taxpayer had requested tions. For instance : interest of approximately $4,388, The confidence of the taxpay- who audit tax returns but also by 000 . tive and that policies and pro- an extension of time for filing his clerks, stenographers, attorneys A New York State Sales Tax Di . ing public in the objectivity and in- The Attempted Bribery Program tegrity of the Internal Revenue cedures are being carried out and 1964 return, he had not filed. Fur- and persons involved in training vision employee offered an em . of continue to serve a meaningful pur- ther research showed that he had programs . During this period a total ployee of the Brooklyn District continued at an intensified level . Service is vital to the success in commending Adolph Moline, Jr., our tax system . To gain this confi- pose . Periodic examinations and not filed for 1962 or 1963 . Tax of 189 persons have been arrested $2,250 on behalf of a taxpayer. appraisals are made of all field and penalties proposed in this case or indicted for attempting to bribe A used car salesman in North an Internal Revenue Agent who had dence and to insure that it is not reported a bribery attempt, the violated the Service conducts con- operations, reporting immediately exceeded $164,000 . Service employees; as of June 30 Carolina offered a Service em . on problem areas or operating de- 1970, 111 of these persons have ployee $3,000 to "fix" an audit . Commissioner said : tinuing inspections into questions "Your excellent performance concerning the integrity and effec- ficiencies which require manage- been convicted and another 55 are A CPA in New Jersey offered ment actions . Although all opera- awaiting trial . $200 to take care of an audit of during the investigation and trial tions are examined, emphasis is his client's return . of the defendants, despite personal risk and hardship, significantl y

84 / Annual Report / Chapter Eight Management Activities / 85 t

during the year, an increase of Aid to Others 29-30 and June 4-5, 1970 . Fiscal about 13 percent over last year's The Art Advisory Group was es- Internal Security conducted year 1970 membership follows : tablished by the Commissioner of total of 8,950 . An additional 5,248 1,146 investigations for other Internal Revenue on February checks of police records were made Donald C . Alexander, Esq . 1, Treasury components during the Dinsmore, Shohl, Barrett, Coates and 1968 . on persons being considered for year. Assistance was also furnished Deupre s This group consists of members temporary short-term appoint- to the Secret Service in the 'pro- Central Trust Tower representing the three major seg . ments or for positions developed tection of the President and other Cincirmai, Ohio 45202 ments of the Art World-museums, under special economic and educa- persons . universities, and dealers . The tion opportunity programs . William T . Barnes The Service, at the request of Lybrand, Ross Bros . and Mont- Group provided advice on the valu . As part of the Service's internal the Territorial Governor, continued gomery ation of works of art for Federal tax security effort, investigations are to assist the Virgin Islands in de . 1100 Connecticut Avenue NW . purposes at meetings held on Sep. also conducted of (a) certain appli- veloping a modern tax system . Washington, D.C. 20036 tember 10-11, 1969, and March cants for enrollment to practice be- Since this program of assistance 16-17, 1970 . Three new members Professor Norton M . Bedford were appointed during fore the Internal Revenue Service, and internal audits was originated University of Illinois at Urbana. 1970 as (b) charges that are made against in 1962, Virgin Island tax revenues Champaig n Part of the rotational concept of tax practitioners, and (c) aiccidents have increased from $8 .9 million in Department of Accountancy panel membership. The newest 1962 to $47 .9 million in 1969 . College of Commerce and Business members are marked by asterisk in involving Service employees or Administratio n the following list: property. Special investigations or Urbana, 111 . 61801 Dr. Richard F studies are also made when re- Advisory Groups Aid . Brown quested by the Commissioner, the Professor J . Keith Butters Directo r Secretary of the Treasury or other the Service Harvard University Graduate School Kimbell Foundation of Business Administration Fort Worth, Tex . Commissioner Thrower presents commendation to Mr. Moline. components of the Treasury De- The Service uses the abilities of Soldiers Fiel d partment . private citizens, who are experts in Boston, Mass. 02163 Mr . Anthony M . Clark The following tabulation shows their field, through the medium of Director Advisory Groups Sheldon S . Cohen, Esq, Minneapolis Institute of Arts demonstrates to the public the The Balance Shee t the types of investigations com- . At present there Cohen and Uretz Minneapolis, Minn . courage and commitment of our pletedduring the past 2 years and are four such groups appointed . 1730 M Street NW . Internal Security Inspectors Mr. Charles C . employees . . . " investigations the related disciplinary actions ; They are : The Advisory Group to Washington, D .C. 20036 Cunningham completed 10,107 the Commissioner of Internal Rev . Directo r enue, The Art Advisory Group, The F. Cleveland Hedrick, Jr., Esq . Art Institute of Chicago Crimes Bear Bitter Fruit Firearms Evaluation Group and The Hedrick and Lane Chicago, 111. I o r c a Advisory Committee on Exempt 1001 Connecticut Avenue NW . Many investigations Investigations and disciplinary actions Washington, D.C . 20036 Mr . Louis Goldenberg schemers and corruptors into the Organizations. Art Dealer criminal courts, with 58 defend- The Advisory Group to the Com- William M . Home, Jr. Wildenstein & Co . and actio n 196 9 ants starting down the path of our Type of immstigati.- missioner of Internal Revenue was Reed . Smith, Shaw and McClay New York, N,Y. Shoreham Building trial system this year . Thirty-seven 8,950 U ;m established on June 17, 1959 . This Total investigations closad__...... ------Washington . D.C. 20005 -Dr . George H . Hamilton were taxpayers or tax practitioners; committee, which represents pro. Williams College Personnel Investigation s the remaining 21 were employees fessional and other Private groups Walter L. Kid d Williamstown, Mass . 6,806 2. sw or former employees . Trial or in- Number of cases closed, total . .. . . ------concerned with Federal Taxation Director of Taxes Dr . Sherman E . Lee dictment is still pending on 88 Character and security i....tig .thm------_------$ .=I Provides constructive ways in American Telephone & Telegraph ...... M175 .1 am Director taxpayers and 45 employees or Conduct investigations ...... 1,999 . las t which the Service can improve it's 195 Broadwa y Sp.1.1 imi.irms...... ------. . . . . - - . .-----. . - ...... Cleveland Museum of Art former employees. Ahead of them operations . The group met on Oc- New York, N .Y . 10007 Actions Taken by service NitratenvM 1, .01fili-Is -a 8 Result of Parsomml Cleveland, Ohio timn, tOber 16-17, 1969, were the 46 defendants who had 458 1 - and January Jeff Blair McIlroy been convicted of various criminal DiaslitliturtrY -client, trat . . . . ------Public Accountant *Mr . William S. Lieberman 132 182 offenses during the year. S.p.ratimrs . total -_-----_ ------Post Office Box 4345 Director (Prints ) Museum of Modern Art During the year, Inspectors Bribery ..to,ti.. or olle,mn ...... 6 22 Little Rock, Ark. 72204 limbeililement at 'theft If G.W,;;~iWl fund, or property . . ---_------New York, N.Y. were kept busy tracking down a F 13 gilun, of employ. to pay proper ----_--_------21 A. Waldo Sowell, Jr. variety of schemes . For instance: 1,iii"thr, or distortion .1 Government 1P11 , 61 I Prof . Charles F. Montgomery nauthorumd outside 3 CPA, Alexander Grant & Co. A Revenue agent in Now York ad- Failure to diuh.ril . duties P 3 2550 National Bank of Georgia Bldg . University of Delaware Dinilgtmc. .1 onfidmiti.1 i~foltmttic ...... mitted accepting 14 bribes totaling 1b I Atlanta, Ga . 3030 3 Newark, Del . A..pt . .c . -1 hm- -1 Ratufturt 47 J1 between $15,300 and $16,500 ; a N Personal and other misconduct.----.. ..------.. .. : : :-- ...... rd~,Stno..mrs from duty and futyi------Maurice E. Stark, Esq. *Mr. Alexander P . Rosenberg CPA in New Jersey tried to extort eprimand', "'"nings. or demo tons----- I- 302 Zlinary st (including domm,m c - tnt mt Non, and others). . 6,348 TA U Stark and Crumley Art Dealer money from a Service employee to Warden Building Paul Rosenberg & Co . re-grade his CPA exam ; and an Other Imnadiasta- 1 Fort Dodge, Iowa 50501 New York, N .Y . 2 144 an employee in the New Orleans Dis- Number of cases closed . total -_------' 755 Applications for luirnisawt, in p,.til. before the Int.m. Arthur B . Willis, Esq, Mr. Eugene V. Thaw trict embezzled $17,684 .93 by Charge, against Altturs.y'a, CPA's, and Ennilears...... 56 ..._ ...... 172 31141 Willis, Butler, and Scheifly Art Deale r means of a refund scheme . Federal Tort Cial : -----_------108 615 South Flower Street E . V . Thaw Co . Attem ad Bribery ...... ------1.053 -1A" invesubptaf,ons for other Treasury bureau, _---- .. ... ------Suite 1100 New York, N .Y. Los Angeles, Calif . 90017 Includes maignetimIS F9firsommis, or other separations while arrilthrIness war. under invenstilation 0, disciplinary when where investigation disclosed derogatory beforeI administrative &idrm .., ad. . information .

Chapter Eight 86 / Annual Report / Management Activities / 87 I

I

The Art Advisory Panel (above) meats to The Firearms Evaluation Group Mr. Daniel D . Musgrave Present membership is as Hon . Louis J . Lefkowitz The above Picture at the Committee an Exempt can:Ida fine art. valuation matters for was established on November 15, Representative follows : Attorney Genera l Organizations was taken at the January Fed ral tax purposes . 1970 1968 . Informal meetings were held Mauser Works of West Germany State of New York meeting . Left to right are: H . J . Heinz; Richard J. Pictured left to right sested are: Cabin John, Md Dr. Carlton P. Alexis Whalen; Dr. Martin D . Jenkins A exander P. Rosenberg, -Mrs. Esther W. . 80 Centre Stree t ; Julius Greenfield throughout the year, at which ad- Associate Professor of Medicine (attending for Mon . Louis J . L.fk..It.); Harry K. Robles,I' Dr. She- E. Lee, -Dr. Perry B. New York, N .Y. 10013 Mansfield; Judge Elbert P . Tuttle; Charles 0 . Cott. *Louis Goldenberg, Dr. George H . vice was given concerning the de . Mr. Ohn Richards Howard University Galvin Owner ; Fred C. Schribr .,. Jr. (Ch .inrum); Dr . Hamilton, -Blirtlett H. May., -Charles E. velopment of standards to control 2401 Sixth Street NW. Harry K. Mansfield, Esq . John R . Magness; Secretary of the Treasury David Buckley, and Dr. Richard F. Brown. the importation of firearms and Potomac Arms Co . Washington, D.C . 20001 Ropes and Gra y M. Kennedy; Donald T. Burns; Commission., Standing left to right . . .: Randolph W. Thrower; James R. Hull; Deputy . Karl Ruh., IRS. ammunition . The membership of Alexandria, Va . 225 Franklin Street Thomas HartnaM IRS Mr. Donald T . Burns Commissioner William M. Smith ; Bishop Francis Charles C. Cunningham, -Dr . Merrill C . the Group was as follows : Boston, Mass . 0211 0 John Mugavem; R. . . A . We- ..,. Dr Ru.pp .1, ..it Eugene V. Th.. . Mr. Jepta Rogers Arthur Young & Co. Alexis ; . Carlton P, Administrative Assistant Chief Counsel K. Martin Worthy . Members not present when the picture Mr. Donald Flohr 615 South Flower Street Bishop Francis John Mugavero we take. - Firearms Technician International Association of Los Angeles, Calif . 90017 75 Greene Avenue Anthony M . Clark, William S. Lieberman, H . P. White Laboratories Chiefs of Police Brooklyn, N .Y. 11238 Protes, or Charles F. Montgomery, Frank Washington, D.C . Charles 0 . Galvin, Esq . Paris, :no -Theodore Rousseau. Bel Air, Md . Dean, School of Law *Fred C. Scribner, Jr., Esq. Lt . Col . Joseph S . Smith (Ret.) Southern Methodist University Atwood, Scribner, Allen -Appointed ub..q.. .t to June 30, 2970. Mr. Harold Johnson & U .S . Army Deputy Directo r Dallas, Tex . 75222 McKusic k Foreign Service and Technology Civilian Marksmanship Program Commerce Building Department of Defense Mr . H . J . Heinz 11 Portland, Maine 04110 Cente r Washington, D.C . Chairman of the Board Washington, D .C. H. J . Heinz Co. Rabbi Ralph Simon In November 1969 the Commis- 1062 Progress Street Congregation Rodfei Zedek sioner announced the appointment Pittsburgh, Pa. 1521 2 5200 Hyde Park Blvd . of 15 distinguished Americans to Chicago, Ill . 6061 5 Dr. Adelaide Cromwell Hill the newly created Advisory Com- Boston University Mr. Richard J . Whalen mittee on Exempt Organizations . .Afro-American Studies Center 3846 Macomb Street NW. These widely experienced people 10 Lenox Stree t Washington, D.C . 20016 have agreed to serve as Internal Brookline, Mass . 02146 Revenue Service Consultants in the Rene A . Wormser, Esq . Dr. John R. Hogness Wormser Koch, Kiely & nature of a sounding board to re- Executive Vice President Alessandron' i view problems in charting the out- University of Washington 4444 Madison Avenue er limitations of the tax law re- Seattle, Wash . 98105 Now York, N .Y . 10022 garding religious, educational, charitable, and other organizations Mr . James Roger Hull which constitute the majority of Chairman of the Board Mutual Life Insurance Co . of tax exempt organizations . New York The committee met on January Broadway at 55th Street . 15-16 and May 18-19, 1970 New York, N.Y. 10019 'Chairman

88 / Annual Report / Chapter Eight organization-

Organization of the Internal Revenue Servic e Internal Revenue Regions and District s Service Reading Rooms Principal Officers

Historical List of Commissioners

40t-"l 0-TI-7 Annual Report / Organization-Principal Officers 91 INTERNAL REVENUE SERVICE ORGANIZATION

U.S . TREASURY DEPARTMENT

INTERNAL REVENUE SERVIC E ~W~El n,. . Elm National COMMISSIONER ------Office DePuty Commissioner

ASSISTANT ASS START ASSISTANT ASSISTANT ASSISTANT ASSISTANT COMMISSIONER COMMiSSIONER COMMISSIONER COMMISSIONER COMMISSIONER COMMISSIONER (I .Mftn) (Adamiindim) (C-Pin-) (DA, Proassirz) (PI-iq snd (Techi.,) R,-,, h

=T..

.no- -I.W.Tx~

REGIONAL INSPECTORS REGIONAL COMMISSIONE REGIONAL COUNSELS Field (7) (7) (7) Office

District Ihiefts (58) on

92 Annual Report Organization-Principal Officers

Annual Report Organization-Principal Officers 93 internal Revenue Service Compliance Technical REGIONAL AND DISTRICT OFFICER S Reading Room s Assistant Commissioner Assistant Commissioner Donald W . Baco n Harold T . Swartz .same as National Office North-Atlantic Region Deputy Assistant Commissioner Central Regio n (Locations of reading room Mail Address: Mail Address: Leon C . Gree n Deputy Assistant Commissioner mailing address unless otherwise Regional Public Information Richard J . Stakern All Regional Offices at Director, Public Information Division Directors : 550 Main Indicated) Divisio n Office r Division Directors Street, Cincinnati, Ohio 45202, un- Room 110 2 Alcohol, Tobacco, and Firearms : Internal Revenue Servic e Harold A. Serr Income Tax less a different address is indi . 1111 Constitution Avenue NW . 90 Church Street - n cated New York, N .Y. 10007 Appellate John W. Littleto Washington, D.C . 20224 Arthur H . Klotz Miscellaneous and Special Provi . Regional Commissioner sions Tax Charles G . Keeble r Central Regio n Southeast Region Audi t Assistant Regional Mail Address : Singleton B . Wolfe Linder Hamblen Commissioners : Mail Address: Technical Publications and Administratio n Regional Public Information Regional Public Information Collection Arthur J . Collinso Harold E . Snyder Services n Officer Office r August F . Pohli g Alcohol, Tobacco, and Firearms Room 7106 Box 926 Intelligence Rex D . Davi s I Federal Office Building PAtlanta,.O . Ga. 30301 Vacan t Appellate 550 Main Street Location : Office of International Operations Office of Chief Counsel W . Franklin Hammack Federal Office Building Clarence 1. Fox, Jr. Cincinnati, Ohio 45202 Chief Counsel Audi t 275 Peachtree Street Michael A. DeGuire Mid-Atlantic Region Data Processing K . Martin Worth y Mail Address : Southwest Regio n Technical Advisorto Chief Counsel Collection Regional Public Information Mail Address : Assistant Commissioner Robert B . Jacoby William~J . Grabo, Office r Regional Public Information Vacant Special Assistant to Chief Counsel Data Processing Officer Deputy Assistant Commissioner W. Dean Mathis Wayne S . Kegerreis P .O. Box 12805 Intelligence Philadelphia, Pa . 19108 1600 Patterson Street Vacant Special Assistant to Chief Counsel Location : Dallas, Tex . 75201 Division Directors : Lester Stei n Harold B . Holt Associate Chief Counsel (Litigation) 401 N . Broad Street Western Regio n Management Information District Directors : William E. Palmer Richard M . Hah n Cincinnati, Ohio 45202 Midwest Region Mail Address: IRS Data Center, Detroit Mich . Technical Advisor to the Chief Paul A . Schuster Mail Address : Regional Public Information Ernest Sha w Counsel Cleveland, Ohio 44199 Regional Public Information Offi6er Paul E . Treusch Flood Building Operations Frank S . TUrbett, Jr . Office r Clinton. L. Walsh Detroit, Mich . 48226 17 N . Dearborn Street 870 Market Street Division Directors : San Francisco, Calif. 94102 National Computer Center, Alcohol, Tobacco, and Firearms Thomas A. Cardoza Chicago, Ill . 60602 Martinsburg, W . Va . Lega l Indianapolis, Ind . 46204 John E. Stewart John F. McCarren James E . Daly Systems General Litigatio n Louisville, Ky. 40202 Donald G . Elsberry J . Walter Feigenbaum Robert J . Dath Enforcement Parkersburg, W. Va . 26101 Hugh D. Jone s Principal Officers of the Inspection William F. McAleer Refund Litigation Director, Central Service Center, internal Revenue Servic e Assistant Commissioner Robert A. Bridges Vernon D . Acree, Jr . Covington, Ky. 4101 9 As of June 30, 1970 Tax Court Litigation Everett L Executive Assistant John T . Rogers . Meek Office of the Commissioner Administration Fred . G . Robinette Regional Counsel Associate Chief Counsel (Technical) Clarence E. Price Commissione r Assistant Commissioner Division Directors: Thomas McP. Davis . NATIONAL OFFICERS internal Audit Randolph W. Thrower Edward F . Preston Special Assistant to Chief Counsel Regional inspector Deputy Commissioner Director, Program Staff Francis 1 . Geibel William A. Costello Internal Security Arthur B . White Willi:m H .,Smit h Julius H . Lauderdale William F. McCarthy Division Directors : Assi tant a the Commissioner Division Directors : Interpretative Edwin M . Perkins Facilities Management . Planning and Research John L. Withers Assistant to the Commissioner Leo C . Inglesby Legislation and Regulations Roger V . Bart h Fiscal Management Assistant Commissioner James F. Dring Chairman, Tax Forms Coordinating Alan C . Beek Albert W. Brisbin Operations and Planning Committee Personnel William P. Crewe James N . Kinsel Albert J. Schaffer Division Directors : Assistant to the Deputy Public Information Planning and Analysis Commissioner Joseph S . Rosapepe William A . Vogely Donald C. Dawkin s Training Research Director, Foreign Tax Assistance Stanley Goldberg James R . Turner staff Statistics L. Harold Moss Vito Natrelle Systems Development Lancelot W . Armstrong

94 / Annual Report / Organization-Principal Officers Annual Report / Organization-Principal . Officers 9s 11

M~d-Atlantic Region Midwest Regio n North-Atlantic Region Southeast Region Southwest Regio n Western Region Al Regional Offices at 2 Penn Center All Regional Offices at 35 East All Regional Offices at 90 Church All Regional Offices at 275 Peachtree All Regional Offices at 1114 Com- All Street NE ., Atlanta, Ga . 30303, Regional Offices at 870 Market Plaza, Philadelphia, Pa . 19102, Wacker Drive, Chicago, Ill . 60601, Street, New York, N .Y . 10007, un- merce Street, Dallas, Tex . 75202, Street, San Francisco Calif. 94102, unless a different address is indi- unless a different address is In- less a different address is indi- unless a different, address is indi . unless a different address is indi- cated unless a different address is in . cated . dicate d cated i cate d dicated . Regional Commissioner Regional Commissioner Regional Commissioner Regional Commissioner Dean J . Barron Alvin M . Kelle y Regional Commissioner Regional Commissioner Harold R . Al l William J . Bookhol t B . Frank White Homer 0 . Croasmun Assistant Regional Commissioners: Assistant Regional Commissioners: Assistant Regional Commissioners : Administratio n Assistant Regional Commissioners : Assistant Regional Commissioners : Assistant Regional Commissioners : Administratio n Administration Americo P. Attorri William F . Sulliva n Administratio n Alcohol, Tobacco, and Firearms Administration Alcohol, Tobacco, and Firearms John E. Foristall Daniel H. Hollums Billy L. Gaun t Joseph T. Davi s Alcohol, Tobacco, and Firearms Alcohol, Tobacco, and Firearms Charles R . Peterson William A . Coliawa n Alcohol, Tobacco, and Firearms Appellate Alcohol, Tobacco and Firearms Appellat Edward J . Fox William N . Griffin G. Clinton Witt Brenton G. Thorn e Appellate Wallace T. Morris Appellate Appellate Audi t Appellate Victor Cuniglio James C. Stigamire Vance N . Bates Lawrence M Gardiner B Audit Audit . Stewart . Willmarth Audit John W . Baudendistel Audi t Collectio n Audi t Dwight L. James William M . Wolf Harold B . Bindseil Raymond F Collection Collection Alfred N . Kay . Harless Collection Roger C . Beck Collection Data Processing Collectio n William F. Cullincy Date Processing Robert M . McKeever William H . Loeb George M . Oliver Charles D. Moran Data Processing Norman B . Bergeson Data Processing Data Processing Intelligence Data Processing Anthony L . Carrea Intelligence Marshall P. Cappelli Edward G . Pranczke William E . Willard L . Pierson Intelligence Beloate, Jr . Intelligence William B . Mayes Intelligence Intelligence Amerigo R. Manzi Alan McBride Edmund J. Vitkus District Directors: Herman F District Directors: . Kueh l District Directors : District Directors : District Directors: Albuquerque, N. Max . 87101 District Directors Baltimore, Md. 21202 Aberdeen, S . Dak . 57401 Albany, N .Y . 12210 Maurice E. Johnso n : John B. Langer Atlanta, Ga . 30303 Irving Machiz Chicago, Ill. 60602 Donald T. Hartley Austin, Tex . 78701 Anchorage, Alaska 99501 Newark, N.J . 07102 Augusta, Maine 04330 Aubrey C. Ross R . L. Phinney Lewis J . Conra d Roland H . Nash, Jr. Edwin P . Trainor Whitney L. Wheeler Birmingham, Ala . 35203 Cheyenne, Wyo . 82001 Boise, Idaho 83701 Philadelphia, Pa. 19108 Des Moines, Iowa 50309 Boston, Mass . 02203 Walter T . Coppinger Richard L. Hutt Calvin E. Wright John F. Hanle n William E. Williams Columbia, S .C. 29201 Dallas, Tex. 75201 Helena, Mont. 59601 Fargo, N . Dak. 58102 Harold M . McLeod Nelson L PittVac:burgh, n t Pa . 15222 Frederick Brooklyn, N .Y . 11201 Ellis Campbell, Jr . . Seeley H . Alan Long G. Kniskern John J . Flyn n Greensboro, N .C. 27401 Denver, Colo . 80202 Honolulu, Hawaii 96813 Richmond, Va . 23240 Milwaukee, Wis. 53202 Buffalo, N .Y. 14202 John E. Wall Arthur A. Kennedy Robert M . Cutts Boyle Walter S. Stumpf John E. Foley Jackson, Miss . 39202 Little Rock, Ark, 72203 Los Angeles, Calif. 90012 Omaha, Nebr . 68102 Burlington, Vt. 05402 James G . Martin, Jr. Frank S . JamesWilmington,P. Del. 19802 Richard P. Vina l Fred W. Johnso n Schmidt Carl R . Gromatzky Fulton D. Fields Jacksonville, Fla . 32202 New Orleans; La . 70130 Phoenix, Ariz . 85025 St. Louis, Mo . 63101 Hartford, Conn. 06115 Andrew J . O'Donnell, Jr . Chester A. Usry George D. Patterson, Jr Director, Mid-Atlantic Service Center, Eugene C . Coyl e . Joseph J . Conley, Jr. Nashville, Tenn . 37203 Oklahoma City, Okla . 73102 Po rtiand, Oreg. 97204 Philadelphia, Pa. 1915 6 St. Paul, Minn. 55101 Manhattan, N .Y. 10007 James A. O'Hara Clyde L Arthur G . Erickso n Earl L. Torgerson George 0 . Lethert . Bickerstaff Edward J . Fitzgerald, Jr. Director, Southeast Service Center, Wichita, Kans . 67202 Reno, Nev. 89502 Springfield, Ill . 62704 Portsmouth, N.H. 03801 Warren A. Bates Regional Counsel Jay G. Philpott Chamblee, Ga . 30006 Harry F . Scribne r Cecil H . Haas Frank W . Murphy Claude A . Kyle Salt Lake City, Utah 84110 Providence, R .I . 02903 Director, Southwest Service Center, Roland V Regional Inspector, Bankers Securi- Director, Midwest Service Center, Austin, Tex. . Wise Kansas City, Mo . 64170 John J . O'Brien Regional Counsel 78740 San Francisco, Calif . 94102 ties Building, Walnut and Juniper Henry C. Stockell, Jr . Ervin B. Osbor n Joseph M . Culle n Streets, Philadelph is, Pa . 19017 Arnold S . Dreyer Director, North-Atlantic Service Cen- Regional Counsel Regional inspector Regional Counsel, 1025 Elm Street, Seattle, Wash . 98121 Emanuel M . Schuster ter, Andover, Mass. 01812 Neal S . Warre n Frank C. Conley Norman E. Morril l Earl L. Fuoss Dallas, Tex . 7520 2 William B . Riley Regional Inspector Regional Counsel, 26 Federal Plaza, Director, Western Service Center, Gordon M . Anderson New York, N .Y . 10007 Regional Inspector, 1511 Bryan Ogden, Utah 8440 5 Robert H . Terry Marvin E. Hagen Street, Dallas, Tex. 7520 1 David 0. Lowry, Jr. Regional Counsel, 447 Sutter Regional Inspector, 26 Federal Plaza, Street, Son Francisco, Calif. 94018 New York, N .Y . 10007 Richard C . Sidney M . Wolk Schwartz Regional Inspector, 1076 Mission Street, San Francisco, Calif. 94103 Frederick R . Row e ll i

96 / Annual Report / Organizatiort--Principal Officers Annual Report / Organizatior-Principal Officers / 97 I Historical List of John W . Mason Guy T . Helevering West Virgini a Kansas appendix Commissioners Mar. 21, 1889/Apr. 18, 1893 June6, 1933/Oct .8, 1943 of Internal Revenue Joseph S. Mille r Robert E. Hannegan West Virginia Missouri Apr. 19,1893/Nov. 26,1896 Oct . 9, 1943/Jan . 22,/1944 St' John Forman Joseph D . Nunan, JF. Office of Commissioner of Internal1 Revenue W! created by Act of Congress, July . 1862 Illinois New York N ov. 27, 1896/Dec . 31, 1897 Mar. 1, 1944/June 3 0,1947 Taxpayer Publications ' George S . Boutwell Nathan B. Scott George J. Schoeneman Massachusetts West Virgini a Rhode Island Tax Forms Activity July 17, 1862/Mar . 4, 1863 Jan . 1, 1898/Feb . 28,1899 July 1, 1947/July31, 1951 Joseph J . Lewis George W. Wilso n John 0 . Dunla p Supreme Court Decisions : I Pennsylvania Ohio Texas Mar . 18, 1863/June 30, 1865 Mar. 1, 1899/Nov . 27, 1900 Aug . 1, 1951/Nov . 18, 1952 Actions of Lower Courts William Orton John W. Yerke s T. Coleman Andrews New Yor k Kentucky Virgini a J uly 1, 1865/Oct . 31, 1865 Dec. 20, 1900/Apr . 30, 1907 Feb. 4, 1953/Oct . 31, 1955 Statistics of Income Reports Published Edward A. Rollins John G. Capers Russell C. Harrington Now Hampshire South Carolin a Rhode Islan d Nov . 1, 1865/Mar. 10, 1869 June 5, 1907/Aug . 31, 1909 Dec. 5, 1955/Sept. 30, 1958

Columbus Delan o Royal E . Cabell Dana Latha m Ohio Virginia California Mar. 11, 1869/Oct . 31, 1870 Sept. 1, 1909/Apr . 27, 1913 Nov . 5, 1958/jan . 20,1961

Alfred Pleasonto n William H . Osborn Mortimer M. Caplin New York North Carolina Virginia , Jan .3,1871/Aug.8,1871 Apr . 28, 1913/Sept. 25, 1917 Feb . 7, 1961/July 10, 1964 John W. Douglass Daniel C. Roper Sheldon S . Cohen Pennsylvania South Carolin a Marylan d Aug. 9,1871/May 14,1875 Sept. 26, 1917/Mar. 31, 1920 Jan .25,1965/Jan .20,1969 Daniel D. Pratt William M. Williams Randolph W. Thrower Indiana Alabam a Georgia May15 1875/July3l,1876 Apr . 1, 1920/Apr. 11, 1921 Apr. 1, 1969/ Green B . Rau m David H . Blai r Illinois North Carolina Aug . 2, 1876/Apr . 30, 1883 May27,1921/May3l, 1929

Walter Evan s Robert H . Luca s Kentucky In addition, the following were Acting Kentucky Commissioners during periods of time May 21, 1883/Mar. 19, 1885 June 1, 1929/Aug . 15, 1930 when them was no Commissioner holding the office : John W . Douglass, of Pennsyl . Joseph S. Mille r David Bunnell vanm from No.. 1 . 1870, to Jan . 2, 1871 ; West Virginia Ohio Han; C . Rogers, of Pennsylvania, from Aug May I to May 10, 1883, and from May I Mar. 20,1885/Mar . 20,188 9 . 20,1930/May 15, 1933 to June 4, 1907: John J . Knox, of Minne . sat., imm May I I to May 20, 1883; Robert Williams, Jr., of Ohio, from Nov . 28 to Dec . 19, 1900; Millard F. West, of Ken . tucky, from Apr. 12 to May 26, 1921 ; H . F . Mi Is, of Washington, from Aug. 16, to A... 19, 1930 : Pressly R. Baldridge, of Iowa, from May 16 to June 5, 1933 ; Harold N . Groves, of Illinois, from Jan. 23 to Feb. 29, 1944; John S . Graham, of North. 19 Carolina. . from Nov . 19, 1952, to Jan . 1953; Justin F . Winkle, of New York, from Jan . 20 to Feb. 3. 1953 ; 0 . Gordon Delk, of Virginia, from Nov. I to Dec, 4, 1955 ;.nd from Oct to Nov. 4, 1958 ; torl .. 1 : . . of Utah, -from 1 Jan. 21 to Feb. 6. 1961 ; Bertrand M. Harding. of Texas,and fr m July 11, 1964 to Jan . 24, 1965 ; or . Smith of Virginia, from Jan. 21Will to iam Mar H. 31, 1969 .

98 / Annual Report / Organization-Principal Officers I Annual Report / Appendix / 99 APPENDIX tax calendar that lists the dates income earned abroad may be ex- when farmers must file certain re- empt, or partially exempt, from Certification Required to Obtain 505 524 Reduced Rates under Income Tax Tax Withholding and Declaration of Retirement Income and Retirement Taxpayer Publications turns and pay taxes . More than a Federal income tax are provided in Estimated Tax million free copies were distributed this 32-page booklet . Approximate. Treaties, Publication 686, instructs Income Credit In the 1970 edition of Your Fed- '~y Service offices and by extension ly 770,000 copies of this booklet a U .S . taxpayer on the procedure 506 525 oral Income Tax, Publication 17, agents of the Department of for obtaining a certification that he Computing Your Tax Under the In. Taxable Income and Nontaxable were printed for free distribution is entitled to the benefits of an come Averaging Method special emphasis was given to the Agriculture. through Service offices and U .S. Incom e now income tax return form and The Teaching Taxes Program embassies and consulates in all income tax treaty between the 507 526 several of the schedules were illus- continues to be used in approxi- parts of the world .' United States and a foreign coun- Tax Information on Scholarships and Income Tax Deductions for trated in connection with the sam . mately 25,000 high schools and The foregoing publications have try. Over 20,000 copies were Fellowships Contribution s ple filled-in tax return . An entire colleges . Three publications were been revised and republished an- printed and made available through SOB the Office of International 527 page was devoted to "Items of In- used to present step-by-step expla- nually to reflect new developments Tax Information on Educational Rental Income and Royalty Income terest," highlighting the significant nations of the preparation of indi- in the tax law. Three items formerly Operations. Expenses Tax Information on Interest 528 changes in the law that occurred vidual income tax returns . The issued on a periodic basis were re- 509 Information on Filing Your Tax during 1969 . Also shown on that Teacher's Guide, Publication 19, designed and incorporated into our Equalization Tax, Publication 565, Tax Calendar and Check List for Return page was a checklist of things to do which contains answers to the tax annual taxpayer publications pro. was developed to assist U .S. tax- 1970 when preparing an income tax re- payers in determining their interest 529 problems appearing in the student gram . These publications, which sic Other Miscellaneous Deductions turn so refunds would be processed text, was sent to approximately are available through the Service's equalization tax liability, if any, on Information on Excise Taxes for promptly . 95,000 teachers. The student texts, Office of International Operations the acquisition of foreign stocks or 197 0 530 This 160-page booklet, designed Understanding Taxes, were pub- to United States taxpayers over- foreign debt obligations . Explana- Tax Information on Deductions for tions of the requirements for claim- 511 Homeowner s to aid the individual taxpayer in lished in a 28-page general edition, seas, are as follows : Tax Return Fil- Sales and Other Dispositions of filling out his income tax return, Publication 21, and a 36-page farm ing Requirements for U .S. Citizens ing an exemption from the tax, for Depreciable Property 531 was written in nontechnical, easy filing the return to report acquisi- Reporting Your Tips for Federal Tax . edition, Publication 22. About 3,- Abroad, Publication 563 ; Interest 512 to-understand language . It contains 654,000 general texts were distrib- Equalization Tax Highlights, Publi- tions, and for payment of tax due Purposes re provided in this 24-page publi- Credit Sales by Dealers in Personal answers to most questions tax . uted, and about 458,000 students cation 573 (formerly Notice 59) ; Property 532 payers might have when they pre- used the farm edition . This indi- and Filing of U.S . acation. The information contained Tax Information for Students and Annual Return of 513 pare their returns. It presents cates use by 150,000 more stu- Income Tax to be Paid at Source, in this publication is limited to that Parents which applies primarly to indvidual Tax Information for Visitors to the numerous examples illustrating dents this year than the previous Publication 574 (formerly Notice United State s 533 how the tax laws may be applied . year. 20) . investors and sets forth in detail Information on Self-Employment Tax the acquisitions that are excluded 514 This is a continuing publication that The Tax Guide for Small Busi- During this year several new 534 is revised each year to include the ness, Publication 334, is a 160 . publications were developed for or exempted from the tax. Foreign Tax Credit for U .S . Citizens and Resident Aliens Depreciation, investment Credit, latest changes in the tax statute, page booklet aimed at answering free distribution to meet particular Other publications that were dis- Amortization, Depletio n tributed free of charge are listed 515 regulations, and official rulings . tax questions of small businesses, needs. These new publications are 535 Approximately 1,330,000 copies including sole proprietorships, discussed below. below . Withholding of Tax on Nonresident Aliens and Foreign Corporations Tax Information an Business Ex . of the 1970 edition of Your Federal partnerships, and corporations . As Tax-Sheltered Annuity Plans for penses Income Tax were sold at 60 cents in prior years, it explains in non- Employees of Public Schools and Publication NumberlTitle 516 a copy by the Government Printing Tax Information for U .S . Govern- 536 technical language how the tax laws Certain Tax-Exempt Organizations, 308 Losses From Operating a Business Office and local Internal Revenue apply to business situations. The Publication 571, was developed to Farmers Gas Tax Credit ment Civilian Employees Stationed Abroad 537 Service offices. The Service used an Guide features a "Tax Calendar for inform teachers and others of the 349 additional 360,000 copies in vari- Businessmen" showing the dates special Federal tax provisions that 517 Installment and Deferred-Payment Federal Use Tax on Trucks, Truck- Sale s ous educational programs. for filing returns . A "Check List" apply to certain "tax-sheltered" an- Tractor and Buses Social Security for Clergymen and The Farmer's Tax Guide, Publi- of business activities lists the kinds nuity plans . This 20-page booklet Religious Workers 538 cation 225, is a 48-page booklet of Federal taxes to be paid with re- explains and illustrates the condi- 378 518 Tax Information on Accounting Peri. intended to help farmers in prepar- spect to each, what forms to use, Federal Gas Tax Credit or Refund ods and Method s tions and limitations of th e tax* for Nonhighway and Transit Users Foreign Scholars and Educational ing their income tax returns . It and the page in the Guide where deferred treatment accorded these and Cultural Exchange Visitors 539 463 explains what income is to be re- each kind of tax is explained . Ap . plans . The special provision that al- 519 Withholding Taxes From Your Em . ported, what farm expenses may be proximately 200,000 copies of this lows an employee to exclude from Travel, Entertainment and Gift ployee's Wages Expenses United States Tax Guide for Aliens deducted, how to claim deprecia- booklet were sold by the Service gross income, to a limited extent, 520 540 tion and soil and water conserva- and the Government Printing Office his employer's current contribu . 501 Tax Information on Repairs, Replace- Your Exemptions and Exemptions Tax Information for American Schol- tion expenses, and how to report at 60 cents a copy. Another 80,000 tions toward his annuity is ex- ars Abroa d ments, and Improvement s self-employment income. The 1970 copies were distributed for internal plained in detail as well as the tax for Dependents 521 541 edition featured a sample filled-in use by the Service . treatment of benefits receivable 502 Tax Information on Partnership In . income tax return based on illus- Deduction for Medical and Dental Moving Expenses-Tax Information The new edition of the Tax Guide under the plans. The booklet also for Employees and Employe r come and Losses trated farm income and expense for U .S. Citizens Abroad, Publica- contains a computation sheet de- Expenses 522 542 records, including a detailed de- tion 54, continued to fulfill the signed to assist the employee in 503 Corporations and the Federal Income preciation record . It also contains need to explain the special tax pro. determining the amount of the ex- Child Care and Disabled Dependent Adjustments to Income for Sick Pay Tax "Important Dates to Remember," a visions that affect U .S . citizens liv- clusion allowance and the amount, Care 523 Tax Information on Selling Your 543 ing in foreign countries. Explana . if any, of the employer's current 504 Home Tax Information on the Sale of a tions of the conditions under which contribution that is taxable to him . Income Tax Deduction for Alimony Business Payments

100 / Annual Report / Appendix Annual Report / Appendix / 101 The following tax return forms The Supreme Court reversed the 6" 567 4562 were eliminated : Supreme Court Decisions Tax Advice on Civil Service Disability Depreciation judgment of the Court of Appeals Sales and Exchanges of Assets Civil Case s Retirement Payments 4563 (Formerly 1040E) Form Number/Title for the Sixth Circuit in United 54 5 940(010 ) States v. Estate Income Tax Deduction lor Interest 568 Exclusion of Income from S~urce!~ The Supreme Court, agreeing of Donnelly, 397 FederaI Tax Information for Civil- in United States Possessions Employer's Annual Federal Unem- with the Commissioner, held that, U .S. 286 (1970) . The Sixth Circuit Expens e i ployment Tax Return Service Retirees 4573 when the stockholders of a corpor- had affirmed, per curiam, the judg- 5" Application for Deterrr~nation-lncfi- 941(010) ation were required by State law to ment of the district court which' Income Tax Deduction for Taxes 569 Answers to Questions Most Fre- vidually Designed. 'Plan (Under Employer's Quarterly Federal Tax Re- purchase the stock of a dissenting had held that the Internal Revenue 547 quently Asked by U .S . Taxpayers sections 401(a), 405(a) and 501 tur n stockholder, the attorney, account- Service is required to attempt to Tax Information on Disasters, Cas- Abroa d (a) of the Internal Revenue Code) 1040 Packages 2 and 3 ing, and appraisal fees incurred in file a notice of lien with the register ualty Losses, and Thefts 570 4574 Federal Income Tax Forms for In- connection with the necessary ap . of deeds before filing with the dis- 548 Tax Guide for U .S . Citizens Em- Application for Determination-Indi- dividual s praisal litigation were a part of the trict court even though the State Tax Information on Deduction for p,oyed in U .S . Possessions vidually Designed Plan Covering 1040E cost of the stock acquired rather of Michigan, at that time, required Bad Debts Self-Employed Individuals (Under Schedule for Citizens of the United than deductible section 212 ex- a description of the land which was 549 TAX FORMS ACTIVITY sections 401(a), (d) and 501(a) States penses . In doing so, it rejected the later held invalid in United States of the internal Revenue Code ) v . Union Central Life Ins Condemnations of Private Property The following new tax return forms 2950 and Instruction s so-called "primary purpose" test . Co ., 368 for Public Use were issued: 4575 Statement in Support of Deduction and applied a standard based on U.S . 291 (1961) . Additionally, the Application for Determination-In- for Payments to an Employee's the "Origin of the claim litigated" district court had held that, in any 550 Form NumberlTitte Tax Information on Investment In- vestment of Trust Funds in Stock Pension, Profit-Sharing, Stock and, in this case, the expenses event, the Union Central decision come and Expenses W-4 E or Securities of Employer (Under Bonus Trust or Annuity Plan and were deemed to have originated in should not be applied retroactively Witholding Exemption Certificate Sections 401(a) and 501(a) of the Compensation Under a Deferred- 551 connection with the acquisition of against good faith purchasers . The (For use by employees who an- Internal Revenue Code ) Payment Pla n the stock . Noodward v Supreme Court reasoned that th e Tax Information on Cost or Other ticipate no tax liability for 1970) . Commis- . . . Basis of Assets 4576 2969 sioner, 397 U .S . 572 (1970) ' af- presence or absence of the 637-A Application for Determination-Ter- Application and Permit to Use Docu- firming 410 F. 2d 313 (8th Cir . legally futile act of tendering the 552 Registration for Tax Free Transac- mination or Curtailment of Plan mentary Stamp Tax Mete r Recordkeeping Requirements and a 1969) . This was a companion case noncomplying notice to the register tions (Under sections 401, 405(a) and 2970 to United States v. Hilton Hotels of deeds could not be a factor de Guide to Tax Publication s 501(a) of the Internal Revenue . Schedule A (1040) Order for Setting Documentary Corporation, 397 U .S . 508 (1970) terminative of the priority to be 553 Itemized Deductions Code) Stamp Tax Mete r wherein the Court reversed a con granted the federal tax lien ." More . Highlights of 1969 Changes in the 4577 Tax Law Schedule E (1040) 3673 flicting opinion of the Seventh over, it is not a question of the Supplemental and Miscellaneous Application for Determination--4n- Application for Approval of Self-Em- Circuit. purchasers relying on a statute dustry-Wide Plan and Trust (Under 554 Incom e ployed Pension of Profit-Sharing In the case of United States v. which was later held unconstitu . Tax Benefits for Older Americans sections 401 (a) and 501 (a) of the Plan as Part of a Master or Proto- tional the Supreme Court nor Schedule R (1040) Inteinal Revenue Code ) Key, Trustee, 397 U .S . 322 (1970) by 555 Retirement Income Credit type Form or Any Bond Purchase the Supreme Court reversed th~ was it a situation where res judi . Community Property and the Fed. 4578 Plan (Under sections 401(a) and Court of Appeals for the Seventh cata would be applicable . Instead, Schedule T (1040) Application for Approval of Bond Pur- 405(a) of the Internal Revenue eral Income Tax Tax Computation Circuit which had affirmed the dis- it is the principle that Acts of Con. chase Plan that includes Seff-Em- Code) gress are generally to be applied 556 pioyed Individuals trict court's confirmation of a plan Appeal Rights and Claims for Refund 1040-FY 3953 of reorganization in a Chapter X uniformly throughout the country U .S . Individual Income Tax Compu- 4625 U .S . Commercial Bank Weekly Infor- from the effective date forward and 557 tation Computation of Minimum Tax mation Return Bankruptcy Act proceeding' The How to Apply for Exemption for an plan provided for payment the the Service is entitled to adhere to Organizatio n Supplemental Schedule D and In- 4626 3964 Government's tax claim over aof long what it'believes to be the correct structions (1040 ) Computation of Minimum Tax-Fis- Weekly Information Return With Re- period of time with the unsecured interpretation of a statute and to 558 Gain from Disposition of Depreciable cal Year Corporations and Fiduci- spect to Foreign Commercial Bank- Tax Information for Sponsors of Con- creditors being paid ahead of the reap the benefits if the interpreta . 1! Property Under Sections 1245 and an s ing Subsidiarie s tion proves correct . tests and Sports Events 2250 ; AND Computation of After. Government . The Supreme Court 4629 3969 On March 3, 1970, 559 native Ta x reversed the court of appeals and the Supreme Transfer of Property to an Exempt Notice of Acquisition of Original or held that Rev. Stat . 3466 (31 U.S .C Court decided United States v. W. Federal Tax Guide for Survivors, Ex. 1040-ES(F) organizatio n New Japanese Debt Obligation ecutors, and Administrators Estimated Tax Declaration-Voucher 191) required that the Govern . M . Webb, Inc., at al., 387 U .S . 1 ~9 for Farmers and Fishermen 4638 3973 ment be paid first, ahead of other (1970), reversing and remanding 560 Federal Use Tax Return on Civil Air. Receipt of Part I of Notice of Acqui- 402 F. Retirement Plans for Self-Employed creditors, and that a plan which 2d 956 (5th Cir. 1968), in. I Supplemental Schedule D (2065) craft sition of Original or New Japanese provided for payment contrary to volving the important issue of ndividual s Gain from Disposition of Depreci- Debt Obligatio n able Property Under Sections 1245 4653 the provision of R.S . 3466 was not whether maritime law is to be ap. 561 Notification Concerning Foundation 4415 fair, equitable and feasible and plied in determining whether cap. valuation of Donated Property and 125 0 Status Election To Exempt From Self-Em . could not be confirmed by the tains and crewmen of commercial 1120X Ployment Coverage Fees Received 564 Corporation Income 4653-A district court over the Govern. fishing vessels are "employees" of Tax Information on Mutual Fund Amended U.S . By Certain Public Officers And Em- the boat owners for employment tax Tax Returns Notification Concerning Foundation ployees State Or ment's objection under the pro- Distributio n Status of Subordinate Organiza- Of A A Political vision of section 199 of the Bank. purposes . The case involved men . 2363 tion s included in a Group Exemp- Subdivision Thereof 566 Export Exemption Certificate ruptcy Act. haden fishing vessels used in the Questions and Answers on Retire- tion Atlantic Ocean and the Gulf of Mex . ment Plans for Self-Employed 425 5 ico . The Supreme Court adopted Individuals Tax from Recomputing a Prior Year Investment Credit the Government's view, and that of

Annual Report / Appendix / 103 withholding and social security the Court of Claims in Cape Shore a value equal to the net value of of both the primary and secondary . Subsequently, the taxpayer substantially identical in all ma- his motion for the return of proper Fish Co. v. United States, 330 F. 2d the receivables . The Supreme Court taxes reserves reach a certain level and . was adjudicated as bankrupt . The terial respects, except its organiza- ty and to suppress evidence, Dr 961 (1964), that maritime law . reasoned that the "so-called tax the secondary reserve is then uti- tion date, to certain bther similar . Referee refused to declare a trust Hill questioned in Part whether a rather than "common law" stand . benefit rule" could not be applied, lized to pay the primary premium . coroprations which had been orga- ards applicable to land-based because the transferors actually in favor of the United States on car- If an institution elects to terminate search warrant could validly issue did not secure any "recovery" or tain funds which were'withholding nized before the cutoff date and for the seizure of private books, activities, was to be applied . It de- its insured status, FSLIC 'must, re- were entitled to the exemption "double benefit" from bad debt re- taxes withheld from wages of the papers and documents in light of scribed maritime law as "the com- fund its "secondary reserve ." In under section 501(c)(14) . It could mon law of seafaring men ." Under serve items which had previously employees of the debtor but not so holding, the Court rejected the the Fifth Amendment . The Court given riseto tax benefits . There was paid over to the United States . On find no rational basis for Congress in denying the motion, noted that the standards of maritime law, an Commissioner's position, provided making a distinction in this in. no "recovery" because it was con- review, the Government contended in Rev. Rul . 66-49, C .B . 1966-1, there is "no special sanctity in employer-employee relationship that under section 7501(a) of the stance based solely on the organi- may exist even though the degree cluded that the value of the secu- 36 (i.e., that the deduction is zation date papers, as distinguished from other Internal Revenue Code, when one . It held that the tax . forms of of control by the employer is more rities received in the exchange Was proper when the possibility of the property, which renders is required to collect taxes from payer had been discriminated them immune from search and limited than in the case of land- no greater than the face value of return of the premiums has been against arbitrarily and deprived the receivables less the amount of another and subsequently pay the of seizure," and that the "documents based employees . V . precluded or the taxpayer's income property without due process of Maclin P. the reserve. taxes collected, the monies col . and exepnses thereof are not sought to be seized were instru . In United States lected constitute a trust for the law . The Government has applied mentalities by Davis, 396 U .S . 815 (Mar. 23, matched) and the Tax Court's posi- which the crimes of benefit of the United States . The directly to the Supreme Court for willfully attempted tax evasion had 1970), the Supreme Court resolved tion that the premium payments in . reversal of district court, while recognizing the district court's been and were then being commit. a conflict between the circuits as to Actions of Lower Courts to the secondary reserve are for decision . contrary authority, affirmed relying the acquisition of something in the ted, as well as evidence of the the proper test to be ap plied in de- crime istribution in Civil Case s on In re Green, 264 F . Supp . 849 nature of a capital asset . Lincoln Of -willfully attempted tax termining whether a d Criminal Cases evasion The Court of Appeals for the (D. Colo . 1967) and the footnote Savings and Loan Association v . ." As instrumentalities, the redemption of stock is "essentially .in Nicholas v. United States, 384 On February equivalent to a dividend" under Fifth Circuit in a decision rendered Commissioner, 422 F. 2d 90 (9th 25, 1970, the Su. Court held they were subject to In the opinion of forfeiture, and as evidence were section 302(b)(1) of the 1954 on June 24, 1970, in United States U .S. 678 (1966) . Cir. 1970) . PreMO Court in The Colonnade the district court, the priorities Catering Corp subject to seizure, Code . It rejected the "business pur- v . Stewart, Trustee, 428 F. 2d 319 In Steadman v. Commissioner, . v . United States, pose" or "flexible net effect" tests . 1970), upheld the Gov- should be determined under sec. 424 F . 2d I (6th Cir . 1970), how- 397 U .S . 72 (1970), reversed the The Tenth Circuit affirmed the (5th Cir conviction of Arthur which had been applied in the past ernment's contention that income tion 64(a) of the Bankruptcy Act ever, the Court rejected the Com- decision of the Court of Appeals of J. Fiorth on a tax deficiencies not assessed at andc these priorities should not be missioner's contention that .a loss the Second Circuit (410 F . 2d 197) five count indictment charging will. by a number of courts of appeals, reason of the trust fund ful and accepted the Government's the time of the petition in bank. hanged 6y on a corporate stock which became and upheld the District Court's failure to account for and pay conc pt of Code section 7501(a) . suppression over withholding and "strict net effect" test . It held that ruptcy which the Government was worthless in the hands of an at. of evidence seized FICA taxes, purpose is irrelevant, the control . prohibited from assessing prior to The Court of Appeals affirmed the torney, who allegedly purchased the from a retail liquor dealer by break . willful failure to file employer's district court and consequently the ing open a locked liquor storeroom quarterly tax returns, and willful ling test being whether or not the bankruptcy under section 6213 of stock solely to retain the corpora- . redemption actually results in a the Internal Revenue Code will not Government's claim for employ- tion as a law client, was a capital The Court based its decision on the failure to file an individual income ment taxes was relegated to the tax return for meaningful reduction of the stock- be discharged regardless of how old loss pursuant to section 165(g) of construction of-the statute provid . 1963 . United States v. Porth, holder's proportionate interest in the subject tax liability may be. The priority accorded all Other admin- the Code . It held the loss to be an ing for entry and inspection of 70-1 USTC 9329 (10th istrative expenses under section 64 Cir. 1970) . the corporation. The Court also Court further stated that an assess- ordinary loss under section 165(a) Premises of retail liquor dealers, In regard to the latter (a)(1) of the Bankruptcy Act . Peti- charge, it was shown that Mr held that the attribution of owner- ment for the difference between the of the Code since it was purchased holding that the statute did not . Porth tion for certiorari has been filed by authorize forced entry submitted an income tax form ship rules contained in section amount shown by the taxpayer on by the taxpayer as an integral and . However, the Government . containing only his name and rate, 318(a) of the 1954 Code must be its return and the amount calcu- necessary part of his business, re- the Court held that refusal to per- In a case which will, in all prob- mit entry of Internal Revenue of ence to various constitutional pro. applied in determining dividend lated as correct by the Service is lying upon Corn Products Co. V . . equivalence under section 302(b) an assessment for an amount of ability, be the subject of a re- Commissioner, 350 U.S . 46 ficers would subject the proprietor visions which he asserted excused quested Supreme Court review, the him from filing a return (1) . Its holdings on these two taxes not reported on a return made (1955), rather than purchased for to the penalty imposed by 26 . The form Ninth Circuit held that "secondary filed was completely devoid of in, points resulted in a dec ision against by the bankrupt. The Fifth Circuit investment . The Solicitor General U .S .C ., section 7342. The Court the taxpayer, who (after applica- was interpreting section 17a(l)(c) premium payments" made by a has decided to request Supreme specifically declined to apply the formation concerning his income, Savings and Loan Association Court review in this case. rule laid down in Camara v . Munici. Provided no basis on which his tax tion of the attribution rules) was of the Bankruptcy Act as amended by the Federal . . The decision reversed which was insured in Maryland Savings-Share In . Pal Court, 387 U.S . 523, and See could be computed, and was ac. the sole shareholder of his corpo in 1966 cordingly held ration both before and after the both the Referee in Bankruptcy and Savings and Loan Insurance Cor- surance Corp . v. United States, 308 v. City of Seattle, 387 U .S . 541, by the Tenth Circuit poration (FSLIC) were deductible which would have required the ob not to be a return within the mean redemption . the distirct court which had held F . Supp . 761 (D . Maryland 1970), . . in the year paid as ordinary and taining of a search warrant before ing of the Internal Revenue Code or On May 18, 1970, the case of that the taxes were dischargeable the district court has held uncon. States, 398 necessary business expenses (sec- stitutional under the due process the penalty for refusal to permit in . related regulations . Nash, at at . v . United because the Government was not These payments, made spection was decided ad . prohibited from assessing as there tion 162) . clause of the Fifth Amendment the could be invoked . United States v . Prudden, 70-1 U .S. 1 (1970), pursuant to 12 U .S .C . 1727(d), In United States v. premises, USTC 9336 versely to the Government . This de- was no prohibition against sending provision of section 501(c)(14) of (5th Cir. 1970), in- were ava i [able to FSLIC to pay 801 N . volved not only the matter of cision resolved a conflict between a statutory notice at an), time or the 1954 Code which limits the tax Seventh St ., 310 F. Supp . "Cus. losses only after a "primary pre- 1316 (S .D . 111 todial interrogation" as defined in the circuits and held that taxpayers against a jeopardy assessment . exemption provided therein only to . 1970), a search war. mium reserve" (payments thereto Miranda v . using the reserve method of ac- In the case of In re Hato Metal certain corporations organized be. rant had been approved under Title Arizona, 384 U .S. 436, being annually deductible under 444 (1966), but likewise the mat counting for bad debts do not real- Products Co ., 419 F . 2d 1068 (7th fore September 1, 1957 . The court IX, Omnibus Crime Control and . ize taxable income in a nontaxable Cir . 1969), the taxpayer while oper- section 162 by the member) was held that the taxpayer, which was Safe Streets Act of 1968 (see 18 ter of alleged fraud and deceit by exhausted . By law, the "secondary U .S .C . Internal Revenue Service agents section 351 exchange when ac- ating as a debtor-in- possession organized after the cutoff date, was 3103(a)) to seize books and premium payments" are sus- records of Dr. Vincent R . Hill . In through soliciting taxpayer's coop- counts receivable are transferred to under Chapter XI of the Bankruptcy pended in any year once the total eration and failing to advise him of a new corporation for stock havin g Act incurred liabilities for unpaid Possible criminal consequences of

104 / Annual Report / Appendix Annual Report / Appendix / 105 their inquiry . In considering the al- taken most favorably to Prudden's Statistics of Income Statistical leged improper conduct of Service position it falls markedly short of agents, the U .S. district court had demonstrating by clear and con- Reports Published Tables suppressed 511 corporate and per- vincing evidence that he was the Individual Income Tax Returns , sonal records furnished to the In- victim of fraud, deceit or trickery ." 1968, Preliminary (31 pp ., 259) Notes : ternal Revenue Service on the In rejecting taxpayer's contention Corporation Income Tax Returns, All yearly data are on a fiscal year ground that they had been obtained that he was entitled to Miranda 1966 (316 pp ., $3) . ' basis, unless otherwise specified . by the agents' fraud and deceit in warnings the Fifth Circuit noted Corporation Income Tax Returns For example, data headed "1970" preventing the taxpayer from un- that there was "no factual support 1967, Preliminary (32 pp ., 359). pertain to the fiscal year ended derstanding that their investigation for a contention that Prudden was Foreign Income and Taxes Re June 30, 1970, and "July 1," in might have criminal, as well as civil put in such an emotional state as ported on Corporation Income ventory items under this heading consequences . The Fifth Circuit-re- to impair his capacity for rational Tax Returns, 1962, Supple. reflect inventories as of July 1, versed the suppression order, hold- judgment," and "no evidence that mental Report (263 pp ., $2 ) 1969 . ing that the record did not disclose the incriminating evidence was co- Individual Income Tax Returns, In many tables and charts, fig- any affirmative misrepresentation erced as a matter of law; i.e., was 1967 (259 pp. $2 .75 ) ures have been rounded and may that would establish the existence the result of in-custody interroga- U .S . Business Tax Returns, 1967, not add to the totals which are of fraud . The Court found, after a tion or anything approaching com- Preliminary (34 pp ., 350) based on unrounded figures. careful review of the whole record, parable pressures ." The Court rec . U .S. Business Tax Returns, 1966 Internal revenue districts are that the ultimate finding of fraud ognized that of the nine Judicial (321 pp ., $2 .50) listed in this section by the names and deceit on the part of the agents Circuits which have spoken on this of headquarters cities . Each district was a mistaken one. True, the issue, decisions favorable to the is identical with the boundaries of agents never advised the taxpayer Government have resulted in all but the State in which the headquarters that their examination of the tax the seventh Circuit. United States city is located except for the States returns might result in a criminal v. Dickerson, 413 F. 2d 1111 (7th recapitulated at the bottom of prosecution, but they were not re- Cir . 1969) and United States v. tables 1, 5, 6, and 14. A map of the quired to do so. Such a warning Habig, 413 F. 2d 1108 (7th Cir. districts papers on page 93 . was held to be inherent in the 1969) . [Note .-Prudden, supra; agent's statement t hat they were Simon v . United States, 421 F. 2d there to audit the 'returns. The 667 (9th Cir. 1970), cart . den . 38 Court held that the burden is on the LW 3453; and United States v. movant in a suppression hearing to Caiello, 420 F. 2d 472 (2d Cir. establish his right to suppression 1969), cart . den . 38 LW 3406 of the evidence by clear and con- (1970) ; have specifically rejected vincing evidence . The Court then the rationale of the Dickerson opin- went into each facet of the evi- ion .) Compare United States v . dence, which the taxpayer had con- Heffner, 420 F. 2d 809 (4th Cir . tended constituted affirmative 1969) . fraud, deceit or trickery, and con . cluded that "[w]hen the record is

I,

106 / Annual Report / Appendix -_- 0 - 11 - - Annual Report / Statistical Tables / 107 Statistical Tables Collections, Refunds, and Returns CASES RECEIVING APPELLATE Filed CONSIDERATION OR IN 1 . internal revenue collections by LITIGATION sources and by internal reve- Appellate Division nue regions, districts, States, and otherareas/11 0 16 . Receipt and disposition of 2 . Internal revenue collections by cases not before the Tax Court sources and by quarters/ 117 (nondocketed cases) / 13 1 3 . Internal revenue collections by 17 . Receipt and disposition of in- sources, fiscal years 1969- come, estate, and gift tax 70/11 8 cases petitioned to the Tax 4 . Internal revenue collections by Court (docketed cases)/ 13 1 principal sources, fiscal years 1940-1970/120 Office of the Chief Counsel 5 . Internal revenue refunds in- 18 . Processing of income, estate, cluding interest / 123 and gift tax cases in the Tax 6 . Number of returns filed . by in- Court/13 2 internal revenue regions, dis- 19 . Receipt and disposal of Tax tricts, States and other areas/ Court cases in courts of ap- 12 4 peals and in Supreme Court/ 7 . Internal revenue collections, 13 2 cost, employees, and U .S . pop- 20 . Receipt and disposal of suits ulation, 1940 through 1970/ filed by taxpayers in Federal 12 5 courts and actions by the S . Internal revenue tax on manu- United States for recovery of factured products from Puerto erroneous refunds/ 13 3 Rico/ 125 21 . Decisions of courts of appeals and Supreme Court in civil tax Alcohol and Tobacco Taxe s cases/133 9 . Establishments qualified to 22 . Receipt. and disposal of collec- engage in the production, dis- tions, injunction, summons, tributioln, storage, or use of and disclosure cases/ 133 alcohol and alcoholic liquors/ 23 . Receipt and disposal of insol- 12 5 vency and debtor proceed . 10 . Establishments qualified to ings/ 133 engage in the production or 24 . Receipt and disposal of mis- exportation of cigars aind cig- cellaneous court cases, lien arettes/ 126 cases not in court, noncourt general litigation cases and 11 . Permits relating to distilled . apeal cases / 133 spirits under Chapter 51, IR 25 Caseload report / 13 4 Code / 12 6 12 . Permits for operations relating to alcoholic beverages under Cost of Administration the Federal Alcohol Adminis- 26 . Obligations incurred by the In- tration Act/ 12 6 ternal Revenue Service/ 135 13 . Permits relating to tobacco un- 27 . Obligations incurred by the In . der chapter 52, IR Code/ 126 ternal Revenue Service, by ap . 14 . Label activity under Federal Al- propriation and activity/ 136 cohol Administration Act / 126 28 . Quantity and cost statistics for printing/ 13 7 Stamp Taxes 15 . Number of occupational tax stamps issued, by class of tax and by internal revenue re- gions, districts, and States/ 127

Annual Report / Statistical Tables / 109 Table I .-Internal revenue collo ctions by sources and by internal revenue regions, districts, States, and other areas Table 1. -internal revenue collections by sources and by internal revenue regions, districts, States, and other areas- I In thousands of dollars. See table 3, p . I IS for lax Fates and Further breekdow, of national ortals by soucasl Continued fill thousands at dallarx. See table 3, P. 118 for tax rates and further breakdown at national totals by source5l Ind dual Income and employment taxes Inte-Leveav . egunIi . districts Sta.,. ------Ind the, areas I Total internal - Alcohol taxes eve- Corporation I-ar. tax Income tax (States represented bs Single di,inst, indicated in C.11calwal income tax at withheld withheld and Railroad UalmoployamorI t m Excum FI.IS, Distilled spirits faces Parenthesesfare 1 ; totals for other States show, at botto Total and s .11-con cld-.Zu and etairroom I-Inic. Internal revenue realms, districts, States and other total (Surn at .) PI.Yerent disability .,.as - Estate tax Gill is, ofeclumna, Trial asurInce 3 1 t (States ,presented 6, single district, indicated 11 . 26 . 30, Total Input in parent h Ss .x ; total, I., the, Six- show . at 31 . 37 . 38. (cal lacteal Domestic I knIfil, Occupa- Other 1 1 (5) (6) (7) hot,.. at table) .,it 50) by it., Initial I ...turns)

carried Serves . _135,722,09 35 .036 .993 141 .1111- --ar...... (8) (9) (for (11) (12, (13) (14) (15) (Ifi) (17 , Fiewsh-Irs. Ix If...... f .il 1 .11 1s,941 24,8411 .1 . 51 .1 .1 111 .01 Albany...... (See (c) below) ...... 1 .902,766 ILS:3 3 0 I :fl7:6''5'1 1 88.186 .435,341 3,987 to 140 Diluted Sanit- ii-noul ------3,11I .J21 4II .Is s . .? . . .a $ -. .. gas . .. . 74111 .62 1 2 .695 ."] 25 .101 _!!:!!L Augurs . . . . . (Main,) ...... -- - 488,41 6 72,26 8 394.679 99,43 7 298.569 4,35 4 2,319 - - __ losionrim" 896,8377 963,256 4 .701 .680 852,941 3,318,994 5,8915 Z3 .849 Nwituh-AtIselti. R .0------...... 7291 111, :I Issr.3as _;4~-. . a.- 2 .11A . B ;n-- . c 31' 0 .4 3 3,252 169 963.418 10,863 1,1: 13,1 A ~S.a (1) below) ------...... 3.704.893 .21. . : 1 S 5u 21 254 14 . 778 308 ...... 2. . .2 1 I . _ _ 7311" 78 2.63G.592 4 9 : 031 H, 960 a ------12,84 7 :111 I,~2 :138D~ 7 1, 2 .22 0 ------1. i12 B.1hati ;n: 226.674 26 .27 5 187~279 5 2 1 F11. 9 952 .ase suits) 136,236 Boston ...... I Sal ...... 118,8189 17 6311 3 ' 2 . G1 : ~211 '1 16 141 3 1,103 Igi A, I HI rtfi= - _ , n GOO .283 2 670.910 651,420 : : : : : 2, 002, 987 44 16,559 EJrftx ._ 6"( : ~l~c 11 1 27 : 049 1 1481 ,772 75 731 9,8233 . 44 66, Marrhatte Qb ., .), :- : :: : "MI. . ."% 7,3!1%~41 01 JI,316.~13 1, 8411 . -1 .2. -r134 12 .11S .!i, I- S 114 5,11. 5 6 39 .284 4854 3 _ ._ : . , : : ...... : : . 482 Par mouth anno'bre)------44,970 S 28 376,814 82,790 291,785 26 Burlington-Me, (Vermont) ---- - 759 871.90 456,290 ' .04 1 10 2 39 Providence : : . . . (''R'h! . "laval)- ~ . . . . - 688. 837 IIL35I 573,122 ges .3.20, IIII~ 3.r' 1e41 Hard her _ : . . . . . 'llNU013 15,792 123,508 71 .801 70,396 ...... - 69,826 259 2 A finfol-extD.m .,. ex...... 10 0 Manhattan --- 1& Baltimore ...... (Maryland and D .C.) ---- : 5 203:7 0 1 4, 17 93,893 1,246 722 234,171 209 .761263 156~701 . 51, 685222 9394 43,3118 ...... 1 4893-691 4 .260,195 683,463 3: 3J3 :If,211 491 3 N-Harapshife)-, ----- 9,418 711 3 Ninvick ------So ...... 7,105 ISO 1 173 10 1 1 31: 17 a :.5 7 IS 31 ,.,.d .n,I------Rho ( . xlxmd)~ ------21 .57 0 45 IT' 1 4 ...... III Philadelphia 47 : 337,456 025 5 0511 ~11564' 1: 0311 ~ . .. 4,332.aI25 167,6 30,703 1b :ovv,** ~ : : :~ : ~ : : 5 06 Mid-Athunti . Val...... I . . . . . 59 .3,11 2 .309 .22 'L"ra, , 'a - 'i~ ."3 soa~axx I 2.1113,~ 0 2 .ilql~111 l79S3 1 1512.1141 1 .12~,194 507~ 23918' 2,887.67 4 13 43848 20,86 9 Ba ltimore ( M e, y~, ad and D.C.I : : 82 .65 7 9, 43 7 30,88 0 Z6 7 .396 232.969 62,533 ifs 09 Do 9 Richmond ------(Virginia) ...... 531 :412 1,111.11 441ITS .3,S8 1,161 .126 49 .003 786 Newark ---- a a 15,674 494,654 260 :1116, . If,112 : ' 1 1 11 :~3.51 11' 746 2 S., Wilmington ...... (Delaware) . .1 1 2. 4, 71 .01S 22 , 17 '9,1287 . q 161 41 1, se .jara1 7ST&. I Philadelphia RNowS .,: (I) below ...... ------1 .11 . 2 .65 a. 1,0 1M,1 J,1: 1g2~1 : ff13~ S 1.5 1. S5 36~ 653 74 .1 Sea li lis Set S . rus 131"5 8Si6s 1,1:144,S7 . . . 7 4 459 1] ~Iacrl : 141 29 .3 2 209 75 1 7 " 1 . 1 J 43S ~,1 252 I 1 1 8347 J : 19 2.209 1219U 1 PicR harrom Sh -: : : : : W('-ISIII)as V1 : 219153 7.317 534,084 3 7' 645 : Bi.Irant .Alli. . . . . ( 1). 74.958 40 6 1 . MUGS 253, 54 32 8,388 7 :~11 1 Wilmington------(Delaware) ...... ---- - 25,476 6.969 1 .729 ...... 41 1'ga) s 16 49 .86 0 164,741 867,070 177 .635 683 .3077 1 37 9 1 IS a -livernst M 130,60517 67 .75491 . .3a, 3G .2" 51 Cremation...... (11S%.3hC '.1: 1~. 41 : " .654 7179D 11167 2 . 111'I~ :15105 451.771 1,72S.152 1,224 g Atlanta ------: : : . (GiioFriu6 : : : : 45 :6,5D Z1,18 "15NINS 112 :4503 5 :71114 1 , 1214...... 3 1118 41 (Mississippi) ------658.467 0 8 146 :39 517 IS3 ~sa Birmingham ------(Alabama) ------5 .644 41 :,2Pi: 344 5S8,14113 , 3,333.447 1,124 .47489G 2.155365 9471 35, 82 1 3 2 10,1017 62 SS11 27I 17,30264 Columbi, ------(South Car, 12 , 1, 4 11 ", : ,713.1 145 is . . . . . C ., Nashville, ...... (Tennessee 96 743 29,37 1,585.723 1 .171,971 1.831 15 : 3 .20 7 6 401 .830 IOrD9 I Greenstme-_ - (North Car2 risna ~ : -- - 48, '1 '18 211. 11,774 123 23 14 111. 13 6.102 .0116 21 .686 .502 1 .151.53 ~JI411, 67 aa* U4 .M Jackson . . . . ------(MissisDPPl)__ - . inat- iigiii; :[31 :9 I N2 3J. . : 1111 17,47 7 jacksmaylla (Florida) ---- ...... 21yebund...... 7 13'. .~94. . 11 I1121S 1411144' I S 11,1123'8 3SA613 11.378 7 .9965 ZI 35401 26 . (See it) below)------.793,172 1 : 345IS: "494' 251511" :77541 711.132 4,741,8281 4 5. 104 28,79 0 Nashville ...... (Tennessee)------31 :461 ~1:734 47,451 1 . 22' 950 22,827 22,735 - . . . . 61 3I1s ...... 13,303,001 906 .496 7 ~1746 :1815 111146 4521 6 701 322 11. : '3713T 4 :21 - - - ...... 6 - .------01 .1ndianarls-it ...... ---. . . (Mk`!ain`(ind n ). ._-. . 12 :,101,11 1 630 7 0 - Ise,73 4 44 .9,611 4 .993 .75. W .4S1 1 .412,979 M6 .2,67 11175,asl I .- 3 02 :.853 2~ 7994 : 39 1 13 1 8 Cincinnati- (SIS:a ~ d) To---- - 67,583 5 704 203,119 158,911 128,360 ------26,630 1,530 199 2 Lor ESVII a ...... (Ke,t,cky). .- .-- 72 .306 315.2120 1,1201 .1 % 29 2 25.91147 17go 1t Cleveland 6 rkersburR ------(West Virginia) . . ----- 682 .183 88,410 86 .168 19,601 751 56 for, 562 231 :.1 11~ 5 IS712 : 2119.0 S41: 141.,7 1114 3 1 2 512 .008I 1441 0831 11IS4 : '97'S I2 : Detroit- . ------Oific~hllrxft) . 101 . 155 12,576 2,117If, ! 1~11 1114 :114 Mr ------11 44191~ 215 Irse .57s 22 11,121~0114128 1,1 111.a122 123 .9U0 13 Indi,repis is ------(Indiana) ...... 111 3: 3, 1 6 .-"Ablirdaim "w"". .-. : _. _. _~ .- - - - TS a-u-t-h- -6a------24~583 ' CfiQ 6,01 ' File)...... 12, 244,057 -,Mot '179':' Louis IS ! (Kentucky). .-- ...... ~ : : 1131, , 2 5 . 193 .91 3 ...... IS64 694 .259 1'19 :M4 3 571, :111 1,96 5 70 141 . (So, T) ...... 594,830 1,113~EZ 9 .078,219 1 .561 .129~? 7.334 .899 126,511 55 69 0 PxrkeisWj~ :_~~ : : (West Vizi .i.)------. .. 11 .537 646 19~581 6~2s5 6~084 ...... 6 .056 2 25 C"',Gas : 1.612,687 A'386 1 .281605 837 .394 498 5,94 4 below ) 439369 f eldwevi, Fal...... ------funi .ses Se ". J ."J ." rhol ..27 56 1 423 .067 A I a ..111 it Fargo ------__~'pow'l h Dikiller -)------241,029 19,958 210 08 3 80.963 129.36 0 Are, din- - - - - ( o .kh Dakota)------4 : Alit talk ea...... Wiscror io ...... 3,532 .328 71 11,4 2,531 .437 482.722 2 . 033 : 685 170 J1,1 5 Chicago------(Sir. JET below) ------0 an .he...... (Nebraxka) . 1,132.991 "53: 1 7 9 2DD ..007 194 2 a. 4220 1 6946 :43 7740 173.16628 1%.22 "1 4i,i5i 1'*)5912 . 5 _ ' ']I~5 ' 74335 . . . . . * ~ St : : : : : : :, : : : , 5 980 1375: 30 :1 7 Des Ailmnes, :: (1**I) -_------30,653 40 30.322 403 15 1 . Lo...... (Mh,,pur1?, . . .125. 196 1717,2 :141 3,796: 4"97 t 64 '" 3 . 072. . . ": 2~335 :2 15,04 ITS Fill ------North Dakota) ------4,590 61627 1~ . 93 44 . . . . . 42 1 4 43171,177, 1 . 112 .6577'1 151 .1107 14 .33. .1. Milwaukee ------(Wisconsin) ------53.343 , 44 111,654 .. S angfi. ~ : : : : ~ 111 : 311~37 221?: 5.52186 3 .276 i'&32 8 705 1 It : : : : : : : : 32 M N2 311 . 2W9 12 '1:4.64. : "7 101 .524 1,082,494 2 6 is Oamba;~_. . ------Mix ------1 ! - 20,117 103 ...... 113 .theiver, lit.gle,,...... 22.1221 S2 .1- .11 . 111~=74 -32 8 St. Lo 9,495 376 .59 6 1257: 843345 35. 227 7 .930 2c, 54 20 . Movic.) ------408,963 26G .777 9 3 5 0 3 St 52,2118 J0.692 3 055. Aus'iChervicarmi_------...... M1 ., (1) 1.1mil ~ ...... 4.171,252 31 23 :92 7 3.2 '11~661. . IS 68584Z 2 .354rO44 3 .704 IT :23 1 . Pat ------(Minnesota) _ : 017: 3"2 301 99 146 2 3 AS': as (See 41,111 71 : '8440 132'44:34"13 305349 278,575 - ...... 159,214 10.998 1 S~rixzfiald ------(b) below) ------' 2757 : 095 3.216 3. DF 128 .590 79 .439 ~ ------212 .1aill 39 .223 201 .159 29 .77 4 13 .07 5 2 2111 Dallas. . (sea (1) below) 3 .708 137 630,415 2 .29 750.291 2 . 12 .64 16 11 .41"381 1 1ASS .- ",US 2,47 Albuquerque (Now Mexico)- . ., 556 1 0al 76.937 19 679 ------& .- 586 (-) Dean,...... In' . a) ------2:'0'5'2 .8991 277.936 1 . 7S'0 : 594790 7 . 997 33 AustinCh ------ISee fi~.998860 10,76 7 Little Rack t2rikersas) ------01 :00 131354 :1111 3 1113,G:7 4 13~I 313S :077 344 30 32 (f) halo%) - 72 . 9 06 65,54685 20361 '00 J4"1 (" 1 9 Myouring)------2. 286 16,463 141 11 :1 1...... 36 (' sha 1 : 7 0 894f,273 8' 1, 84 747 1 .023101 7,151. 1 ) Nkv, Orleans (Louisiana) 1 704,7 [)at]."'"-., 63 14 : 71~ 1 11 1 11~: 11 1 231: 731 199 116 ...... 0 chloma C`~ ((0 k 1111, ...... ,33.0% 21,3J7 :012377 1 :03~111.134 298,86 6 855,127 1 1. 2. I 1S Demvei: : : C"I ad,.). , - 98 S 32 206 Fai l IS Karl-a) . 1 .071 348 .,Saaa 55 ~407 4.767 .112. . .131. . fuli ..~110. .3 Little Back. . . . --- (Airkx-sax)~ 11 :31 7 505 "4 ,30,74 "6 .1 51 few. Frea .im,...... : : ...... Z. .ll 1 .12'1 93 MZ 10S .511 4 New 6 : : : : : : : . 34 n." ."s . . ( Lorislans 084 34 3 (11,111) ------171,111 4 :111" 19,114 25'S: ------32 111 68,904 IJ ..624 10,2511 ...... 2 73a 362 431I OklahomaWichitaOrleans. . . Cl~. . . :. :. :. :. : (OkIllmans) --- - 25,26 9 4 20 1a 309 713 'j : I's! ...... Iasont1 . 41 :01 1 59 0117 39 3".. 1'3 47 4 ~ .'3 I3T37 . ----_------29 .963 2 :64 34:082 1 .241 ...... 7 7 Helena . ------2897 , 96 35 :29 2401:632 99,int T : " 296 D38 w-n ll...... ii, -. ..I. Honolulu ------(Hawaii) ...... 602,998 84,519 P213 '4.1224' 11 12 : 340a a Anchorage ------.479. .. ""'11I sS 1: 7411 a" 171J, -"I ~ f72G . . '133 268-7 1 "I 2 .44391 f-) proonL03 Anigeles . . ------(So . (a) below). . . - 10,74 571 1,635,228 8 .351IN : 31S' .,741,51 . 6.559,3" B62 1,273 45,61 I f Boise ------(Ida no)------4 .309 1 1 4 1 4 0 . . . . ; ...... 897,823 5 2100 134 761 .698 210 150 547~499 15 5 3 894 Hot...... 1 :~2 117 , 11 3 6323I 866 845 -~ 773 3 66 Portland- ---I (A0 1 .463,337 39:544 1,164 .2077Iha 17 067 886231 .456 3,956 6,727 1 5 : Honolulu ------(Haw-0- , 346 13.107 4 2,3?7 178 Sam, IUN , 437 :~119 117l :ti'112S 1 : .0, If 5 2 761 8 .980 2. 55, 129 1 2 68 LosPhmarj~Anval a ------(So,( .) below) ------Z82 .521 17 .473 2 SIRS. Ealikiti.*. , 506 76 41 48 1 6 `515 311: '02 51 3 12: 03 4576.02 156 94 .432 (A a .) . . ~ . . . . . ---- - 2111 : 1 3,277 .275 I Francisco (See (a) below)------7~ 352 . 664 11 11195. 12 :13,111 : 211 1. 211),4 591 4,13F37 . 5 .1 71': 'OV 2711 : 997 21"111 06 Portland .-- 1~151 off Seattle...... ;~ . ----~Iul : : : : : . . 1 .610 .133 321, D46 48,513 1,671,4 79 03 "ints94 Retail) ...... 1 :47 11 3 11~47IS1 612" 31,1. 1" 4.131"1a 11 10,16S1827 11,1 aw .1 Irs- i . 1. Rem, ------Nevada) ------12, 4 13' : J3". 091 ...... - al .",?a , . .", T 1 .713792 1111 Larks ry (Utah) ...... ------3,809 827 39 P St. R,a...... : ...... 282 :"3,56 "4: -41 5 194 59 7 551 ,M8 1 469 ...... OtherI ...... I ...... 581,486 62,291 501,161 6:20? 413 .301 1,505 15 4 I I, a (,I,, hI) Ul..) ------172.630 741": 540 311~217, 311 243~~12' a ..37,~112 - IC 1. . - 21~. 14..I :1, ~ 738 ' T Seattle 41lls~ 314 "1: V17 147,303 Undistributed : Was 'Igt--) ------a, 1 ~, 2 111 2113 1 Federal to' defirsils and alloullturY Keipts C . .. -681,896 -319,482 -362,975 ------361,611 -1,479...... 11 5 M. It Sent------IT 1 . .1 0-11 ------: .a-- , " a41"7 "ST: BISI 'N71 199 "Te70 151 69: '0118 1 : '0,71 Gaisolin bill IS .11, and fac.. FI A other "oila; ...... 4 1: 311,an 111 121 _12~1.: 972 126,972 . . 15~ 039 490 2,505 ...... -11 140 idistrib led : F-derIl tax deposit, and Isola siturya ac receipt ...... 561 ...... to 1I . ..., un,.1 For.I .,alvci, 16,965 16.965 ...... "' 0", 1 1 it a WIN", a. intax.,- 1""' Gasoline, lubricart . FIC A -end I-A!, Fares ...... I ...... ------I ...... ared It, I ~ ...... -91 1 Tr,nsfeTFecJtaGov;rnWoW ;idu;;__ ------Tinar to, State, at show. above Withheld taxes of Told ... I employees ;; -t-uej - ...... CI (a) Cahromi 7.441,238 14,472 587 21 .955 1736 :,117: '76. 36!~ 11" : I'Ji17t :xragac"uF`foTad oil-Air Excise "xes-avi atj ------1 ------. .91...... I...... -. .-----...... -. . .----. .. . ---. . . - Illimil, 1 4 3 ' 2. ~17, 1 1 In,142 . 23 S 1 443511 29. Tota ls 10, States no t shown above j it)) New Vorik .~ -- - - - 32, 1 9331 9 (a IllinoisGShia------28 '90 1 : 198,719 1 505.246 1 71,~ of Ohio ...... 11182 9 :423 111511GS17 1 '11"2 521T J57 :372: 21 isTW1322' "42' 25" "a ;~ '4"S: '11'7 71 ~ 7~1E. 2 99 T-Uq-77-6:~~64t~r-44-i4i - - - -1`1 pnasyholune-vas - . . . . . 11 .840,894 1 . 137: 12'~ 111 :11 :~4~11 7,220 099 121 .121 51 .57 2 455240: 158614 30,26 5 U38.71 7 4 7S)ii" IIal. 7JI 4 35 3. I2 To ...... 8,Z81 .399 .84 42 WS1 I 111",86,97 3 4,458.933 16,35( 3t. 64 5 22IN . 7a llflnI gii I (d] '13IM : 7M1 '2"1 :37 '0 '4 '1~62"217'5 32 1%31~ 208 518 73.287 3375.037 1 .631 559 14 194 , 327 19,944 997.4944 240,333 179 .039 ...... ~6 731gilit 2JIl 1, 1 11 11 Sale tioloulas an IF 120 ------. 25~ 2~ jj~~ 1_20,657 843. 72 93 279 19 408 . 110 / Annual Report / Statistical Tables Sao footnotes on 120 . Annual Report / Statistical Tables / Ill T ble I .-4nternal revenue collections by sources and by internal revenue regions, districts, States, and other areas- Table I .-Internal revenue collections by sources and by internal revenue regions, districts, States, and other areas- C:ntinued Continued To thousi dollars. Sao table 3, P . I IS for tax rates and further breakdown of national totals by sounces] 11 o thotsards of dollus . Sea table 3 . b . I 18 for Ux tales and further breakdown of natural totals by sovimil

Alcohol uxes-Gant,nued Tube. . I . ... 1 .1 .1 tern p Internal -enue regions, districts, States, and other areas I ------Us ., on Internal even.. regains, di,t,,,t,, States Wines. cord,al,, etc ., taxes Beer taxe s and atte, areas States opromifted by single districts indicated in parentheses ; totals ]of 1 .1tat Cigarettes I C~jua,, Cura, I i d,.ndmIff`-t other Star, ; shown It bottom f table) ad'. ..1 (States famencented I by single districts indicated in I V, plated Occupation- (26)) (27) (21) 111) (30 ) paren1hesesas : total for at he States shown at bottom Total 'coFOZI redI Domestic I'I' love : rn Total (.c-. led Domestic I at taxes 1 1 of by Customs) by Customs )

(19) (20) (21) (22) (23) (24) (25) United ...... 2,094=2 1 .031 .101 1,271 22 1 fe-1-11wrid .. Prose- ...... 331 an .1 17 __------. . .-. -. . . : : ...... 17 United St,ox . ted,l . 1112 .921 ur .Ill 10,102 Albary . . . ~ ...... (See (c) below) ' ce ) 2 .57G 1.080 .156 1 A.g.stur Maine) ------V -I .,,ach .,ctt,) ...... 47 1- An-Ale Roakew ...... B M 0) .2 . 45 .I's 20 .992 21,044 1 91 125.505 1 .- _ ..39 75 1 Brooklyn ...... (Sre(c)b,lm,)_ ...... 4 V) 1.0mv) ------480 ...... 478 3 13,990 ------13, 900 4 4 If ffelo ----- .- (See (c) below) ------V ) ABosho . . . .. (Mix...... m 159 ...... 159 C) 5 7 ------. . . . 151, . _-,. ialts) ------, 24 :911734 2~111 J2,411 B ri ngton- ...... (Vermont) ...... ------9 7 H a-Ft ;ord . . . . ------(Umn-ticut) ...... 22 6 .. . .. - -_ _' 226 ' ' 0 BrooklynBuffalo,8 _. ~. ~ : : : IS :~,c ~lbis:jmv~ me ...... 13 '60U2GN, - ...... 60.072 196 Manhattan ---- ...... (Sao (c) beer.)...... 571 127 at : S: . . 17 .02452 ._ . ._ * -_ . . . . 17 ~ 020 4 21 775 ------21 . 600 1756 4 Islington . ----- . . . . (Vermont) . . . . . 52 . ------6 """'t,' n-don - ((Rh owd eHe1= ;'-- -I--. . .- .0tri ~Gmrdo 645 4 765 ...... 769 57 lid ALI-- R... win ...... ------...... 25 .11 . 11 to Mothers 2u, &4320 . .18,973. . . . . 1,338 9 3,988 2,32 127 Baltimore __ ------~ . (Me ryl, nd and D .C.) ------68 ...... 5 3 1 5 PortsmouthP 'h : : ------a I7 328 k ...... (No. Jeise ~) . ------...... 6 rovidemor ., : tRh`o`c . f1sandh 1 313 lEni PhiladelphiaNewer . ------. . . . . 24 .41 2 (*) 1 3 24,43120 ...... 2 Fees ow ...... : : ...... 3 .48, ilsoo J12 271 Us .=? 439 11112,11 .9 111 Pitt b h : : : : : : : : : : : 419 411 inva,_ : "~ do. .D.C .) ---- - 1 .83 1 1, BOG 297 34 32,59 6 439 32 .D99 s urg . ------: : : ~:,) : : ~ : : BIG C) , 5 7 Richmond ------(vuldri,I ) ------484 .046 (13 , 100 I ...... 8,266 ...... 3 90,052 ------90~016 36 Wilmington------Delaware)- (1) ...... PhilodN.1ph ...... (Sao(,)I 1, mvhnv~ : : 1 .711S : : ---- 1 715 15 .68 131, 14.1~ Saudmaxed it"I ...... ------1 .1aill .- 16 .3 . 4 . 1 Pittsburgh ------(See (a) be V ) I1 23 :7B 2 2~" Atlanta ------(Georgia)...... 95 8 ...... Richmond i ...... I lumil)- . . 1,6611 . 1,436 2321 1,005 ------'893 107 B irmingh am ------_ (Al abama) ------2 .871. 2 0 1 41 ...... _ ( .) 4 "( Delaware) ...... ----- 2 ------...... 2 Columbia ------...... No, th a 2,014 2: at --ad R"11. $5, 57,97 1 a "I s 3 1 as, G.... sbo------...... -...... "*,(M issin 4 0 1,123 677 - ...... 4 48 2 Atlanta . ------"511 ...... '162 112 4 .112136 ------1 ~ 128 64 Ja ckson...... iss ipp i) ------...... Birmingham ...... Oklahoma) ...... 52 ------IS jackson' .11------11,4iZ 155 11, 2119 CalumetI, ...... (South C-la .) _ 411911 . . . Naub,fll.~ ------162 ...... reensbaro ------(North Camlina) .- :-* : :: : .4 8 340 4 191as 12 6 'N tored Reveal------_------zy 4 .111131 ...... "1. a. d...... I. I k .. . 2 ...... 1 (Miss I I) ...... 2 7 ------. . . . 137 Circirmati .- .- (Sea (d) b 113 ------Jackson 1 3,7212 4M 159 441 40,172315 ...... 350. 40,226 C eveland------(See (d) b 2'.*) : 777 ...... 77 52 2 ..Nashville...... (Tennesseij :: 1 ------12"1, Detroit ------...... , -----("n Men) --...... '549 2 . . assay...... 3's 111 122,326 sit I. .- Indla.ilrlis~a . ------lmdnama)...... ------...... 6 6 2 . 45 9 Cinefirmat------(Sea Toy below)- 1,141 1 29IS: a To 3 ------&j - 2115 :11 1 2 Lbu isv ------(K imtmc k y)~ ------431 , 562 429 , 456 8 7 1 :.63. .2 ...... 1 30 772 Cleveland ...... (See (d) below ) Parkersburgof ------(West Virginia) ...... 23a 3s 233 ------Dr,trolt ------hinliffor) ------2.37659 _ _ 524 1,745 106 39.513 511 3.,S93 9 -::...... 23 I I - an ,1,) 722 ------ArticlesCh . . . . (South Dakota) . . . . . --1 ...... '19 INJOS '11:'091 174 (See (b) below) ------...... 4 3 1 at Parkersburg. : : : : : : : : : ((We,! 3 ...... 3 198 ------153 45 Des . (Iowa) ...... 10 awaken ...... S ..0 2.2112 7 .498 10 .5 .517 42 4 1" set s Us F.,,IM--. ----T . .-. Notirh Dakota) . - Ab.,dI.n,-- (South Dakota) ...... 25 - . .. . . - , . __ : . . 25 6,315 1,287 ~ '6~6 10,625 305 Mil-k- . (Wootc-) ...... 7 6 1 1 ChicagoM I, . - - (So . (b) below) ...... 2 10. 2N 29 Ormihal Lo u --- ...... (Nebraska) - Day a no ...... I loveg- - - 60 58 _ 1 197 ...... 128 6 9 4 Forgo. . . . . (Nort Dakota ) Si : 1 .2__: : - a: : t . Milwaukee. (N1homs,").It'sak .) : . . . 310 253 64 -a 1310.811 (*) III --- lid 5W 1512 ...... _ Spingridd ------...... (Be by below) ...... a s Onfache 54 54 1 B71: 177311 ------7: B54 2 3 savelin. _ ---- - are 5 too St. L..'s 2,436 294 showers (Missouri? . . 2. 151 4 87.669 1 off Abuqu,nque_ (New 'xi ) ...... C) 168 2 St . Pau l 519 374 1451 41,087 2 949 3 5 IG3 so,[. A ustin-_ _ - (See IN --- 3 wed (TeiI V; w-) ...... 2 1 27,373 ...... dar"12'1:314 81 2 .... do- ...... --- ...... thwant stag-_ ...... ------6.696 1 .527 40 1 151 sair . 316 ChDallas . .. . ------...... ("Yor""g)--(See (f) ow)_ -----...... - 3 7 Albuquerque . - (New Maxim) . . 5~4 2 Austin ...... (Sea fly lnlldw).~~ : 1 .8372 538' 1,0162 2813 44,4944 vii ----- ii:g§ 3 . Icomad I ----- ...... Cle.grono...... (Wirtmirtil)...... Lits...... Boa_ (A,k .mxa . . (*) 9, 7 No. Odcars- (Louisiana)') -* : : :' 2 2 (H D as ...... (So. Q) be]..)- 312 _i~b_ 27 .2287 99 2 . 4fl. 1 . . . . . 1, 4114 7 5 Oklahoma Coli, (Oklah . I (A' 491 Wlchit------(Kansas) . 11111,. . .IT. ;~i _ : : ------1 5 3 W-eend . .I...... J1 .ai;ig..)~ : : : :...... I .10b 230 1,36227 I , 399 6 5 u,ij o ioll A chisrarti- Oklatharmi"M "'a*"' Z '3 1 :06 ------935 34 ...... ------87 ...... 87 Boise ...... (Idaho)...... Wichita ...... KII .,)-.)- .__ - I 1 Helena ------(Montana)------N C ) - 11,711 1,111 17,111 111 IIA, " ? 1,111 111,111 14 1 Thih. Hooolulu-_ (Hawaii)--IS ad-Anchorage- '" see -- (Alaska)----- * ------Los Angola- - (a) below) ...... 61 21 40 2 C - :~ : : : :: : :: i l (* ) 453 ---- "' 435 Phoenix ~4n`mr) Helena . . : : ------(1 20 ------2 0 - - __ ...... I I Polli--- ~ Oregon) ----- ...... 0 ) Honolulu. . . . 1), 5,929 367 7 ------1 3 167 grion- C ) 11 Angles: 3,1046 2 .749 82 % :327" 111.. 5'1. 43 . 5 4 12 4D 2 .236 ~111,an Ille I3~1c.,. - - - ...... C) 19 1 2.224 1 2 so. 3 P rdand .. . . 0 and) . it . 53. 1...... __ 26 _ 1132 5,986 16 5.934 365 R :,n,,,,,, (I 2 ------Seattle- (Washington) . . . . . ---- _ -- - I . . . 5 ------... of fort"a ..1 6 o_-1"* . ------I9 .0s , . . . s ------" ------2~ Puerto Rico . . . . . - IGO22 C) F . (S" I) below) ...... 84 .099 wa i N 19 1 20,92231 ------__- iO - 7 San 'anc...... Oth-__ ------...... Seattle ...... (Washington)- Z197 27 1,970 ___ . . 101 46,718 ______5 _ 46 .64, 2 7 undistributed : .-P .mrt.1so "w- is- denewou-n . . ., _~ : . . . . 3 ...... I '45 ------'4 I5 Federal tax deposits and cle~oxltcrviegipl'~ a3 Giisolin,julbricaUng oil, an excess I CA cod,is_ ...... ------Ira,slerred to Go . . . mment of Gua, . .. . odistributedoth".; ...... ----...... ------...... Fsi tax dio.1ft, add dnsduny .,role i ...... Withheld tau, of Federal employee- ...... G asoli,ne .dl u br icatung oil, an excess FICA cre dit s ' ------Trans 1 . Go encri of Us...... _ ------aid . .a . Total, to, States nor an .. . b.,a Within of Federal tionclovies ...... ------__ : : _ : :: I ------Totals to, States at shown abov e SO 243 b~ Illinois 59 34 102 364 274 1 7 7 :92,1,1 132 262 (it)(ac) No,"HomYorek Ohio ...... 890 888 V ) (I)(b)(,) "CIllinois delitainia. 0"AT 1 11: '2117 " S 21 3 37 do"1, 37 5 5 ...... 24,861 24.949 415: q1S6I 231 : 713111 00,022 2,324 97.110 59 11) P n (d) Ohio ...... 4: N2 22397 44 875 51 44 .800 2"14 (f) T :nxsyIvx`."__ - 168 163 0)(1) 7 Partwurveneisse . , 1,721 ------: 71 59,326 N* ...... 2,149 5]8_ '236 375' - 1 71,088 458 See footnotes on 1 . 120. 27 23 ------11 So' factories an P. 120, 2 / Annual Report / Statistical Tables Annual Report / Statistical Tables / 113 Table I .-Internal revenue collections by sources and by internal revenue regions, districts, States, and other areas- Table 1--internal revenue collections by sources and by Continued internal revenue regions, districts, States, and other areas- Continue d ]In thousands in dollars . See table 3, p . I IS lor tax rates and hurthin otesidown of national trials by -ceil it. thousands of dollars See table 3. jo . Its for tax rate, and further ti-lidow . of r .henal total, by snunceil ------Manutrecturer's-ise taxes I mumal o. ...pairs . districts, State,. and a4mr, .1., 1 Miscellaneous =,,a taxe s (States represented by wrigh, districts indicated In parentheses ; totals I., other State, crown It Intion, of table) Lubxcal- (wholly .1 in chassis Ad ., ,any: TOM G-11n . .2 W . part Dis less con- of rubber), binh-Irfalts,a Other n ' ~,xliaerfails a Internal ,,,one regions, districts, Statel, I'd other Ilessi sort, , at . monn, tube', n is... n q "". 'is ,athletic Tirrilho Glass oil red . oc. . so. his Total deny,net inouniment W,r,i etc, : no III sugar , poiral ..for tread rubber (States represented by single districts indicated in Parentheses ; totals 'an.1 cielcon. "I' an; fuels for other Slates shown at bottom of table) 1 .1rayet"or ec~ a-mins (31) (32) (33, (34) (35) (36) (37 ) (3a) (39) (40) (41) (42) (43) 'I ... M c"s,

Inkink.l. - .1 ...... 3,430 .0 6 .1 . at . I .IsT .382 51.21. .0 B Dennis! sins-, 25 .3111 W ... 2a7 .711 N-A J-11 insig- . 1 al . Ill Is, 1sx . 31.01 1 Albany . "53:1191 19 46 03 178 . . . N.-Axi-til Fur,l- 2 August. : . . . lsq`.(.I~ ------...... 3.110 3 . W I 2 ...... 6 111 1.1 :0 a . .' 12 .::l 21 326 11 5 5 Albany- . .,, 11~2 141"1 024 Boston Miss relln"Aft) . . . 31 .979 26,970 6. 522 1 .778 2,572 C ) 1 AminstiI .- Brooklyn S , (c) hot . .) ...... 22 ij1 14. 1. .11..1 11 .179 11 9 11Is B 8 .fial- S :I(Ilb,ll*--Dinnit) : 3 1: 075.. Boston (Massachu 64,711 46 44 1 .211 2.499 2. 39'9' B 50 13, 587D4 2,028 763 Brookl,yn- .,) 9 31 DD 1.711 V, 1 35 BIG 8,573 2 C) 3 -- - B Hat (Sea(I . r~~" ' :!a, ) : : : : :~ N~ ,i', * 3, 5B 3, 1379 "U1411"Hal aid ...... Connecticut) ...... 67, 517 06 34,72756 2 .70341 21, 57487 Bud,ngt,n . . (Vermont)...... 1,095 342 4231 .0809 83.3156 2 8 481 Manhattan IS a I (c) hot. .) ...... 924 8 12, 2571 ID .871178 5,62 Hartford-lyaqratja~: : (C minct,cut) --- 21 4117 397 Porwou fliw, H "'"hil ) ------...... 1 : 51 12 41 22 Prolidence ...... (Rhode Island)- ,...... 2.919 2 : 306 20 So. (c) hot. .) ------68* B71-4 1 "67: 829 76,2'3W 35, 83840 .3 B, 251 275 3 P.Asonmith- . . New H.-hu,e)- 2 1') 221 484 hald-Ausent . agerifier .- ...... I .- I.A,, es . (Maryland and D.C 65 P-nd"" . . . (Rhode Island) . - ~I " 753 23"2 BN rilturorr 4 ------.) _ 225 31: 1l'S 1-7BI I - 1 32 f Mid-suilia.u . .-_ ...... 2701 .5 29 - .302 .Wa ...... 24 "12 :. . . " 10'. 706 2 .20 1 6 .330 $ .Us2 Sol Baltney . I_~ (Mary and and D .C.) ...... 46 764 -4 35,4434 5,0031 3&2: a PhiladeiiiWiii- 111 '1~ INII l : 14, 96 780 C) Newark' . Near )a,,, ) ---- 56,743 4 Pittsburgh is b ye) 273~19 7 1 3 257, 67 9G 8 8,135 3,41 4 '4 3560 46 ------4 97 4.81 PhiladelphiaP . . (Sea (e) berow~...... 166 28 8'34 :70"6 211 5 .054 11,97651 R chnnood . Virginia) ...... 711 1,117 473 11,614 9" 283 NIstsurgh I(See (~l below rig. . .- . ' Wilmington ...... 6 5 1 3 18 M . "'21: 888 1-) 6 43 3 14 720 nchnnumd hia)~ 11:01fll 2 2~ :056 244 - : : : .- 4: ON thynast ary,ai...... 2 .143 Wilmington ((Dole Atlanta - .. . .:: _ :, : , ~Gsm rgla) :s".1' '"447 :1741a 9P ' .5131 5 1 2,731 tog ------. V . ., r. - . - . . . - - I 1 1 201 T", a-thassid, Phial.r . ---- an. 241 .3711 CutBi,=,, ( Alabama) ~ ...... 13.690 1 .20719 1 4,641265 58412 . .2 . 2a . . A Inter . . . - , : *177 1", 63 54 1 23,556 5, OR 4, - .. . South Carohnii) ._ ...... 67 0 11,48 1 151 Bi-InVirinn . ~Alatbanoa)_ ...... 658too.739 -21 58,76, 6 8 Greensboro ...... (North Carolina) . 131.980 28,323 58 2,407 2.147 1t4o 4,985 2L39. 9 Dyls, .51 3 5 275 5,384 C lumbis South Ga,oInqs)_ . . 2bS -14 Greensboro --- (North Carolina). 21~11~23 " N 1 3,614:IV? I ashirilre------_: _ :~ : 115.21 4 10. 762 3410 33 1 2,2 . 8483 7 1,244 I ...... It 5 "289 3 4 N Tennessee) ...... --- - 13 52 10 701 78 2 12 934 102 1 32 . 2 38 .1 ..&-. ... . vii1le : : ((VMi0i'rId`u-P"-8. , 11 .143 8~41914 .091 - 1' 11 . 161 60 . (Tennessee)-- 11 '166 - I 1 9 56 (1) 3 , 90 (San- (it) -below) - . - . - -...... -. . .I"1Is27 .4'9" 171'7 ..7.:9"05' " "' .... '* 1 :'Bs36 `6 1 ) us ", 7 . .yeiria laselen, - - _ . __ . . - CindIna d 121,664 2,1857' 3932 : 4774' . m Is'. I . . . ~ 6,1s 7 .9 2 .29. W.. 2 Cincinnati (So,Sea ld~ (it hl~1.11 ; : . . . . ZO .311 -14 14~941 161 21,393 COct .,, ',DG9,363 4230: 564770 2a 89 45 -2& 1950 2,054,095 6 1'5' Ch-land Indianapolis . . . . - 41,35 2 12 1 9,328 21 1 69 51 1 53,ga3 109 14 . . Undi-0 Detroit I(Michigan) ...... 68 :10 2 -4 54 797 531 '3. 8 2 ,ILoui.il,, . .. : : tKon uiyiky~r ------. . . - 51,455 47,1105 1,533 rkasbufg : Was! g 113) ...... ani2,035 11645 3D`211 "B3IBI 3 1') led!...F .11- War ans). 41,111III - 1 1129 :603 7Z2.3E). . 1 6 Mid- Igi...... ---- ...... I.A. ~,aly12f a. ..$ Lo.ia,.l I ---- (Kentucky)-- . . 3 8 608 31 1 1 Aberdeen-. (South aket'a .)- .:, 1111 4551, 5.595141 244 ------Parkersburg --- (Weltilnicifix)- 11~212 1, 1: C) . "1 7------.2 "a as'43 U .035 also xyr ..5s IS, (b)tlo.) . 2 20: 22' 2,744 76 A .a.-Aberdeen- - _ - (South Dahot.),__ 2 .161 ...... N 1) 19:521 14,910, 1,081 I2 3 U1 '1 391 C) 613 3 972 Fix 0...... ofth 'do kiiiiiij- - - - . .. . - - 3,658 1 .50' 1g 1'24I Chicago . . . - (See (b) behr.)...... 162,393 - 3 86 .142 as 1 19,087 2,113 Day Moin's- (Iowa) . .- .- , - ---- " 38 -1 5 .080 24 3,196 Milwaukee ...... (Wissinmin) ...... 11B:~323 I1 151 '71 2 131 2,421 16 71 3 Omaha ...... (Nebraska)...... _ . - . . is Fargo .- (North Dakota) ...... l : BE 69929,081 1')120 598 101557 71 ------Milwaukee ---- (W-sirnV . . . 36 244 C) St. Louis ------(M sarcurl)------so 988 72~Z94 1,23 7669 1,816 5,50 9 3 12 3,488 St. Paul...... iminnesota). ------_ . . 4625 .006 41 214 844 329 11 3,111 Omaha ..- .- IN atraska 111 11 114 12 2. 020 . IS a ,Louis- (Missouri) 16,9 :1 '66 13a,5 592 1'21 :11 81721 5 spolifi .ld...... W Wmn) ...... 150 22.637 . 67 36 2,2,2 S; . Paul . (Minnesota)...... 25 53 . . . 696 saxillywanot R .1...... - _ 1 .1,Df .urs 1 .0n .122 30 o n 111- . . . .1711 992 3: 16' At bin nin)- - ...... 6 Springfield. S . .(b) but..) ...... 13 366 -26 a . a22 3 1 Z,493 4 .433 4: 35 5 ...... Sin.1-11 lasol ------.. . . . I ------"* - I TG,071 I ... .6 .175 Austin . . . . . S- : f'."W( I)m asbelo,) .-: ...... 691 .23 8 B3.. 201'.83 7 4 . 04 3 L6558 4 3 a 5, : ' 1*) Albuquerque ------(N- Mexico) 2"3 :372 -3 190 6 - 2.621 C V on 12 111 ~' . 64 Austin ...... (Sea 0? bal ..) D.1131. . . . . "hD: 31 6'2 70 34 002 -22 2.067 2, 1235 3 798 20 8778 ' e 2 .51 67 5,554 260 77 Chain-11(Wyoming) ...... 1...... U 3:69 innim, ------G"E")San.1m.do) "".. ) ------12,246 2.042 306 -- - 24 0 Il :5312-2 14, 5 10.104 1 7 Lit Is Book------(AlkinsialDfLms)):: IS "'2 232': - Is .0,4 4 7 Do "'r.,, : r2don""') 79,793 -1 13, ME 3 237 17,658 3 301 Now1 Oricany ...... (Lou 11 :498 B .111 580 B14 I11S cy Oklahoma City ...... ( Okl.hmo ------_ - III19,125 111 2711 .311111 1,41to, 402 3,430 51 ...... BeLittle Rwk------(Arkansas)(Colo b ...... 5. .1 . . . - 1 .231U8 90 . . . 4 NowOfdah Odeqn~,,. .C. . . (Olds(Lossiagl)-, 1) . 15 431 64 9Jj4 2 24211 :988 Wichita ...... (Kuflaf)~ --- SS .; .21 I .93a4 ...... '54 -2 21: 7112 unw. la"I ...... 4"arl 3S7~423 11 .1. Sa Bqi ._ . . . : (Al( ,slk~ I ) ------'.028 ------Vichitif ------(Kansas)------7,255 3 2 581 'it 4 3 9 slac. Flan.1 ------29S 172 is 267 .5"GO 2G1 .723 hq~ ...... 2,531 2 715 14Is1 258 .7 H:km ...... Ancho,ag, . ~Alxxk .)-_ 2,500 1 730 405 97 ...... (Montana) ...... 470 368 4 Boi-, . . . Id.ho)-_ . ~:,721,1 2 19 1,579 (H-11) 1 395 50 126 DO Helena ...... Montana) ...... 425 1 1 . 21,171 Los An _ : : ~ : : . : ~ -: : : (So. (I) bilo~j : 207,641 162,189 4,681 2,11110. 351'.3%203 2,380 ...... Honolulu ...... - - - (Hawaii) ...... 4:1 1,09D 3 Phoenix ...... (Vzona) ...... 390 1,593 (*) 9 Los Angel...... (See (a) below) ...... Its I I .) GI Q9 22.22 land...... (0 agan) .------17, HUG 311 15.15'5' 1 .448 Poll0. no...... (N-d .)...... of ------...... (Poi.rus)...... 45 2 :370 . . .. . 6115 7 21 94 (_~ 11 _ _ 1 Ilin"'andIll --- ((Oregon) ...... 6 :0st71454 7 . -2 1 950 191 12 :,137 71 s, 1.1 Links ((Utah)...... 4,937a- LBOG 4 187 375 z 566 ...... Bonn Na,ada)~ ...... - _ . i2 i 2' Se Fronch. So, 0) below)...... Z04 ONG .36 0 6,639 1,576 2013,15 8 27 4 1- ) SoftSan LakeFranc City ---- (Utah) ------0 24 C) ID 2 ~ .1111 15 1531, 211 Squirt ...... ; ...... (Washington) ...... 26 :884 186,292 9 is 214 .026 IN (See W below)- 184:0 1 148 380 442 - .1 hory-1 . - 0-firw, IS Seattle . (Wat"'glon)- 462 .057.a 11 .7 i495 (.1)0'. 50 2: 05G Puerto Bic------offt- .1 Los Other...... n Undi Wilerted Puerto Ric.- 1.093 ...... :0,8D. Other- . . . 1 120 j65' DID. . 1...... Federal to, deposits and dyinsittiv recenift 5 Undistributed: Carolina . lubricating oit, an excess I'l C A I I (1 -it3; Federal tax deposits and clelositury renceicls, Iran st erred to Government of Guam . . Gasoline, lubricating oil, an excess FICA credits ; . . V11thheld fic.., of Federal implinnins- ...... Transferred! to Ginnernment of Guam ...... Withheld taxes of Federal employees . . . . - ...... 1101,13 to Staes not sho- eo . Tohils tar States not shown abo, e 0) ...... 1 411,647 344 549 : 1,319 24.571 48~555 21652 4 4 fb) I fifinne . . . . : : : 380 408 Z90:543 5,66 2751:111 472 California ...... 1 21794 .781 4. (it)~) N sy York...... 596 889 449.572 2 1 .2 03: BE 51 .59185 6,690 122 (b)(I) Illinois ---- _ ...... 7go 96 . I ) 1 59 ~,! : .'.u (a)(t) Ohl ...... 111.41. gui1 111. 111 25 1 1396 219 Is 'is1 71 (0 Now York ------. -I GO315t I7DI 1 17968 :238 78,42 6A35331 17, 2"111 14 Painsyl .in,I ------6 Is 5 77,460 15.990 1 3121 827 7 7 of...... 751,580 9 824 270 4:393 716,008 21,478 0B : 56 7.209 324 (a)P.,misil, I1,3: A 90 :335 259 5 I 26,696 (1) Texas...... 7 564 21 11 See hummotes on o. 120~ Is I I . I Is 4 / Annual Report / Statistical Tables See lootn'tes on P . 120 Annual Report / Statistical Tables / 115 Table I . -4nternal revenue collections by sources and by internal revenue regions, districts, States, and other ateas- Table 2-Internal revenue collections Continue d by sources and by quarters Inflansaunds of dollars. See ladale3l, p . 118 lot tax rates and further breakdown of rial,onal lots[, by sowitee.1 fill thoosands of dallarsl

Mise,irch.e ., islit, U .-Confi-d I Q-111 ended ------internal revenue rations, districts, States, Sourc e add the, .,.as t hisuciah" Cino-id-drul Wavering taxes Use tax on and drionju,n e U.Cl-h,ad sent . 9 )do, 30, IWO States retires men by single districts indicated in including lev.c".f ------..to , Palantir ... x; total a far the, Suits h..b at hot, . . -.,a .if.. . I Occupational Waste's vehicle , 3 0 1969 Us- "li, a :3--) - (4) .1 able) x 1 b,sod tosel . . . (4 a4 ) (45) (46) (47) 4 (49) (50 ) 44 911 . 502 40 277,205 4,,454,2)7 63, 079~173 Cup . .. hurt income ta x 7. w . 513 i . ni . iiiI3 G. m4 . 303 13. 273- _~8. 3 sawreek U, stay Stiat... twbal. . 2 .07s 14 .2% - - - an- y .. .Is Islas , Individual income bit mobyroalit taxes, lblbl _ ------36. 44, 470, 184 Alu. . to 11.1...... "1 12 arys2 2a1 . .Is. is j"cmdno..', L,. no wllhh.eid ancivelf-.e.mc, not tat J . I At;anv ...... (So. (c) held.) . 957 2 26 . 48J Augusta ...... (Maine) ...... 89 1:0"18 Z held it old- go d disability in-soc, i 2 s . '2'1~4~2(1 551 21 533 ...... 24 -94 834, 51 ? Boston------(Mav=h ,s,tIs)_ . . . I R ad in, mrsel . _ . . 2bl .525 233.908 I G3 b' 2 lS "601- 7 .3 % nemployment insurance 4 .644 3,406 6~2. Boalkly ...... (Sao (c~ 121 ...... 6 1 .658 504 065 iG, 021, a 'I . 44 ...... : : : 2B B .".1- . . . (Saa(c hot-) . . . . 4 1 .1412~7 436 E late tax ------732,062 7G2.907 Hartugglad, ...... (Vermont) ------870. 553 675, 798 674 -21 Gift tax ------aid . .. : : : : : : : : flo nne,ficul)------I -D ------S Artly11 ~ 41 D 4 1 11 3 1 7 -42 E .'- taxes, total ------4 InYf4' 03 '41 11 Manhattan . See (c) below) 116 " 4d , 2 27 905 29 31 107: 16,6 Portsmouth ...... (NowR Hampshire)A d ------4 311...... _ 31 Alcohol I . . . s, total --- 1 . 1 . 312. 9,ki L 029. 130 Poct'idence..------I trade I an y. 3 _ 1 111,, _33-2. 556 1 . 23U. 17i sextet...... a n in yer5 221 ~ .Wbs .Idled sort . , I ----- 00 03 B It...... (Mvylabd*;mi'wejv : : : ~ 36 425 7 2: 645 1133 424 - 8. 81313 oft-,Due, cordial,, - - _ It- . 4:127 41: 711s87 N' w.rk (Me . I ...... 257 59 4 16 4. 43286G 501 25,644 292,603 25',292_ PUtch . ryef~: : 116 8 892 222~0 26S58 3okf 79 1~12d 1 3 1 '1: 1" 113 2 i . 5 ; WilRichmond noingled...... (Calliam's)(Vniffirdt) 31 ...... -JI2 : 's1 T .ba- taxes, most 5L6, 4i3 501 . 792 533,539 1 13 2,671" 59 -10, 7 9 3&j U. 407 '7 5 a, 527 .SG3 499, 971 490,072 513 191, sewertax. saxopwis sit 2 .1" 27 .,I 31 .Q ' " A inna Z2 1931 65 2,547. . 14,3161 26 :- :- A 21413 311 11' 33 31 Bit righ ...... tabs ..) 1 12s7 1:'11 1 5 :?4 1 37 . Cot'.mb ...... (South Carolina)------1I 7343, 2 1 7 5 Stamp 1-5 on Greensboro . . : : --- : , U 2 14 242 " document, nine' InStsibrubs, and Playing cards, todain 30 2H 37 Jackson . . . . . It 2 3'6'7 2~1 1 1 MantitaClu-S' se- islet, lot I...... 1,720.623 1,621 300 Jack-ill . . .:: : : : : 21I~ 1 112 4 41 36 Nashville . --- Far, 89Z 3 G-l'o_ 84 4 .978 898 562 121,114liy I ~I ' 29 :3 1 9 9 -10-35 67 Lubrical,egod, seats Itheal ...... 121 a. s" 1 s27 2,4 . 372 Cincinnatl-- . . . d ) 24 164 7ios=o"ch"'P'a~'t .t rubber), inner t,b,,,and Ilead rubber-- f72 : "9' . 7" 141,581 3 ""'?57* 2, ~529 13 I'l :43"l Motor y, bodies pa,S. nod ---- CI ... lrymd~ (~Seee ~d be1mv - 50 14 .,ccs,o,i,s 665 G2 0 IS3 1 3 I 7gl, 586,750 45 : . .3 3 kadi. and television cmrmF,o.cts, clo ----- 17 -7 Detroit...... Micti,gibri)...... 1 1 2 '123 35 g ;2' 217' 57 ;' phonographs, Ildfi~ama . . . . it 54 55 Refrigerators, fiebbins,"'. -Condit ... els, ote .: ejeci,,c. gas, and oil appliances 12-17 19 -119 185 565 31 :1 ~ 1~~1 8 :444 other--- '802 12,81 7 L (K . morel _ :~ : G iso 115 , -11 5 . '58 P:rksnburg (Werit Virginia) ...... 231 '3 1 131 2 9 20 799 4 Fird"'Ins, exciiie fears, (out ----- lielldvossat lihoglien, ...... ------14S says 24 7? Abinde...... (South k 2 3 .11, -4-.;5a7 .t.) .. .- . . . . . 99 C) 11 2 23' 147951 21 1 25 Luggage, els: 7 7 Chicago ...... (See (b) below) ------32 10 2.622 _ H1- 05 Jewelry, etc- . Des . . 1 7 2,46' 42 M In' (8 2* 'h- ...... 44 Fit f- Far, :~I: h A 6akou) ...... 74 's 8 2 2N 5 782 Toilet proportion ...... Milwaukee . . M-min)_ - - - - _ 1 4 594 OmahaL ----- Nab. . . k .) ...... 15 30 5 87 31 ~ 24 -28 475 Miscellaneous exione Levee', order ...... (Missouri) . . . . . 835 4.2 620 943 53ti, 12 7 I 1 3 1 32 21 4, 19a 1 'K 'P'.'U;' -. -~ -_ : : : M bnmxotxL___ - , . : : : - : : : : 1 4 3. 07 16, 1 9 Admission Sir ligli.ld...... (Sea (b) beer.) ------8 124 1 7 1,907 27 tow-, ft...... Ifrou"beats.. .res. ...cc,,I,,,,. , let, ormiells, etc .- . an 133" a 3231 .no,it initiation fees, buquinque ------(New Mexico) . . . .. 9 13 515, 1 9 4 S7 2043 -60G Club does 473 fil E AlAtom.- ~ ------(Sao Q) be[..)...... 4 1 109 4, ZIO 04 T,I,,h, a .s,.,.. add equipment ar-c.,r.- . . . Ch .y,nb...... 4 57 4 354 . )75 31~ 7~ 4rA 51 1 314 . 154 (Wyoming) - . lio"heirdo,n G7, CAD 4 . 1 4 73 147 60,130 I :Inl,:, :: : (Sea (f) below; 29 2 78 1 .22'~ A' S31' Use .1 to ftsoosilt 37 551 2 .173 V I Colorado) ------3 6 126 Coconot and other vag, table oil Processed . Little Rook I A, an .. ) ------9 a4l _1124"4 New all . ., ...... ILouisiana) ------635. . Sugar...... 26 .703 30 778 29,691 2VI ~16 Oki. 211, 1 '4 1 :111 232 1,69 5 Diesel and special mxdc~ 6ef' . 311 11,473 'k1 67. 52" homa City ----- (Oklahoma) ------55 305 2,1111 If, 2~ 356 Narcotics ,it m,,ih,,n, . mcludbog WoI pliancy fast,, ;m". bit 4 W-thita ...... (Ka .... ) ...... 13 197 1 .) 1 34 - R..l...... 0%6 :.11: 11:1 Inillentent devices be . Ing alloys, Ind . 2 12 1.3sal ColI ., ;a 6 gaorr,rg devices ...... l"514 5 5 A (Al( .ak .) 34 2 1203 45 326 Id he)...... 3 Wage, ing taxes : V) 16 Iss 41 -13 4 (sciorctitimoal . J11,4, ., I 1- Helena 2 21 ' 8 517 711, W go, ...... 17 4 3 1 U so tax on highway motor vehicles...... 17, :'4 311' 7 "I 21: 239 5, 7" Los An eles- - (Sea (a) below)...... 5D _16 54- 2, 51 -25,783 Ot h 14,368 23 448 li .?Gl Phomu g------(Alumi...... 58 8,55536 1 4 1221 '1 _ i 5i P,11,nl"and .:-- : .. 216 2,318 381, - 1 . 4 Un,l .,s taxes --- -4 , J37 25i W9 'w iso Y92 . 77 7 . IN. ""T"y'. . 1 15 7 1,5841 2541 7 '3 Salt Lake City . (Utah) ...... 5 23 625 26 31 6 S:r, Fl,~.n i (So, 0) tsfiov)~ . . . . . 158 IBO2 2 I'll,"1 S ttl . 5950 5ro, footnote, on p . 129. a'- ...... (Washington) ...... :vq : : 36 158 60 299 2,208 62 2 13 6 P Its 51 I . s 0 ...to Ri ...... 2 :W 7 . : 750 1 .1,1 12 Undi FindmidGasolineanalle"red"I"I" Ia. Job":. d1fieto.Otto,sys0 . ,no d .binifil- receipts 1 56 1 .sy A, 1, :nord aexcess FICA ctedd,7- T Guam- ...... "I'll Id 111' total ,pl* ...f'W~ _ _,,; ...... ------. .it- i, F...... 9 . . ------Totals to, State, not ithow, above

Wb) 1j ,"!.1n1canm , I . . .: : : : , : , : : * : : 39 Il",'MfiriI',"1 I 1. ' (s) New York...... 343 21~ 1 1 117 6 40 1 215157 23 99 7 3bsti76ii',4 IImm. . . ~l n 146 1196 43 sar',. -~ o! ~I1))0111 116 )a6 87 ... is See Woman on p. 120. 116 / Annual Report / Statistical Tables Annual Report / Statistical Tables 1 117 Table 3-internal revenue collections by sources, fiscal years 1969 and 1970 Table 3-4nternal revenue collections by sources, fiscal years 1969 and 1970-Continued [in thousands of dollaral 11, thousabas I dollea l

Foscal yes, Fiscal year

Sairces .1ne'romp, 196 9 So.,- of revenue 1969 (1) (2) (1) '(127 1 I'll. - -C.D once,l 187 9194 560 195,722,096 1 ex'I" faces total 1,501 .146 6. 683, N I Corporation pocometaxes. total 1% . 38 .337,64 5 _35. 035,983 G-lim a cents per A.11- 3 186 23 ) 3 430 076 Rreguls...... 31 33 13"2.6 35 0 183 Lutricalmi, or], etc ., 6 cents Pei gall,n, cutting oil 3 cents Pei or It,,, 97,47 3 8?, 51 0 Exempt .,liamration business cmn, Is ...... 15 Tires 1wholy or in part of rubber), inner tubes, 'r; dor .J rubber : ": 8Of " 1,,,, 10 cents per pound, othm,5 cents per pound except lannunatO true on high- individual income and employment taxes, total . . 13f, 9 . W2 .dox), I cents on, P.Pod_ incomenlm, . x, ,I h*ltto hheldl and self-employment tax ...... 28 972 .731 INI : 17,7 : ""' I , Do pound...... N.. I . . " 2"' : -i and .ld-a roudd-,tollitv insurance, lotals'- ...... 957 565&4G 111,366,075 c a.'a, Pound Z7 .909 29 .01 6 Rallmad retirement,"". d total ...... 39. 6 990,85 1 Memo vehicles, bodies, Pont, and amessouris Unum"'pubrot insurance emrlcyes,t 4 o~ Doong'so's taxed 3.1 percent on taxable Poll", of wages, eflashve Jan . 1, 1964, Passengerluck automobiles chassis,1 bodies . etc., 7 percent 21 1 . 863, 956 1 .765, .321 credit liOnnecIPPED90pariartnflarle cent, lb,firms loState unemployment fund...... 640,030 776,13 9 a, and buses . chassis. th. d 589,304 1986 Paris and racce.scu,na for auto 81,387 84,06 Est 1, tax, graduated rates fre, 3 Percent on first ;5,ODO of net ,late D, excess of S60,M0 ex motion to 77 percent on pOwn over 1R,1P, no components,etc 5 etc .. ~o =Pf v 0,000,000 : credit allowed to, State death taxes 73,136.691 1 3,241,321 hiaetar, I appliance, 5 0 of or, _ pairclol ; as I .D.Munpron, u- tits 1 6 percent :5 Gilt t- glbd..Ild rates I .. 2tj persaml on first 15 PUP .1 Put Rills in ease. of $30,000 acruptem to wa~ -purcirm bpo'ti.. over ToP -ct~i, go., no I : 4 $10,0w,000;$3000annu,l,~lu,iont,r~chdln,is ...... at. a abut e,oh,~ Fs," 1 1IJ percen t 6 169~ Phonograph isceird 0 percent ...... Excise faces total ...... 15-542 7871-- -T5-,9M -,26 4 Musical iatwmams. 1 0 'p. rc .n t 8 __ ~ml._~ufhb , !h .~,~hhC mula, I, atc .), 10 pxx_~ w 11 -3 ( ' Alcohol r, sea total . .9T 13.924 art 4. 555.550 4 . 746,382 Business and store or 10 oei,e,t,--- , ...... Ul...... 3. 1 ' 1,4 , I '.`ppp,'.'1tdaa1'", ~t ` of 1481'U"E C boxes, films. etc . 10 Percent ; household 11P,, Pu .Im,t.'s 5 D o Don,10113 11, 5 0 "dper"p Cpst`p-alplo'"oo i"to'or winesame; ~a fic'n "$it')he . be- few pulml 2,51 1,111'5 :11~1 31 E),,tric Ight,loullo, and tubes, 10 Re ...... Rxect,bration, 30-3 per Pumpt Rate, a ------...... - 31,: 7,414 I'Dearms (of Pit than pistols and iev 'o"I'veu ------33 . 0168~ 32,81D6 0-gatknal fares Mechanical ormcils, peas, 10 percent : light'L a".110 "oen,'t" pe" r' Rh!jd't ., (,, `.,"ceon r~D)I~pbr~x it (lessr ther, U), 17 5 orbavenge manclactursts of spirits, S25, $50, $100, per Ve ...... 7 0 80 Me fiche a, 2 cents per thousand (but not (,l exceed I U percent of selling price); lancy wooden .1 .[ .led Items, 53, cents Rectilurs: par thousand 21...... Less000 than 20.000 proof pall-, $110 per via, ...... : : : _ . rl 20, roof go lions or more, $22 0 . , - - -- :~ : . :~ 1 Retailers' exciss taxes, total ...... 3G 108 Retail ~' al- in liquor or modecinal""'I"r,is'. prei ;ea-,-,-...... 12,427 --874 Wholesale liquorydeavers, $255 Per year_ . 64 Luggage,Is . a sts, 10 Percent------C) Momil.t .irer., D stills . S 55 per year ...... ------1 3 5,12R c.. 10 per en t ------fl~31 2I6 spil.-gp.~gglilvi, of,- - I ...... 1,139 - 1 tilla Do sD,, nnam. actolood . $ each...... 8 3 TD it. t oto'n a ,- 10 police n- 1 Wines . audilla, of, ., Ivan, total ...... ----- ...... ------157, 39 4 F827-929 i..Il,n.oul rusur. (a.." (total ...... _ ...... 2, 147 . -54 7 2, 342. 222 Imported (col ll, , d--tilyi[m. - I,y , ...... E9 7 1 36,7 1 Adminuors taxes, total m ------...... 11 -7 1 me, C1 per W.D. g , r; ca D ; ;i ad Wines, $2 .40 ; Dobripeurlsolordials," If il .92) ...... ------134, 9H 7 43,60? Tnatir's, . thin"' cliMe't", etc .. ,,,,Occupations] taxes : Adossto "c"ts, c.ol each 10 cents or major ftection thereof of the amount paid I, excess of 31 . 22 -? 1 of box office D"c'...... 11 dealers in wums or in Wines and be ., $54 petS year - 2,4721 2,411 TicYnt =,],' seleso,"I 0 Percent of amount, in b,cess . Wholesale dealers In win s of in wines and beer $2 5 per year- 166 - 165 L ogsor seat-,. 10 percent at he ...out to, Which similar comm.dalions - a 11 . . . . 6 9 L Aadaesslo-t a by junprietor, in excess of established price, 50 ancruit of sucp excess-. . , Beer losea, total...... ------...... Hoof aird-, cabarets,' etc., 10 percent of Out mu~ to, admissions. -11c.1, etc . . 3 - 36 Imported (collected by customs1 rate, me a, dari 6.203 6,594 Club dues and imbat ion fees, 20 percent (it dues or lees are in excess of $10 Per YND) 27----- _- --- Domestic. $9 nrearrel5 o 31 gallons I ...... 997,15 1 1,063,55 5 T.Ixph.De,,wI m'M.n1'9j1r etc ces. 10 percent ; wire and qgivnent vite, 8 percent ol . 1,31iiIA' 1 . 469, 5y2";z auga.tianal - Pron-rtatlon pe , 0 perie"I';yin'baled offectne No, .. 16 19 . .1 except an all I-sporta, or, which We, induced 1. 1 visrs ! ...... 223,6817 250. 802 Less than 500 barrels $55 Per yeas ...... 2 Lse D', ...... deripj.-i boons, 10 tricent ------_ ------as rob I , Do more, i1 10 per yes 17 ...... 22 'pa',ijaCorsomapd .,~1.1~,, vegetable oils procerssed, 2-lbixtiy cents per pound losprocalrd . ReprWho bales. n .be,,. $24 for Yost (include, united n.all.0"alers .in wines r beer, $2.20 Der month)----- I I , ppre t'ly Y, cent per pop, ...... e log 191 _)l 13, 3M Instate Irr, m beer, 123 per .a,...... -_ ...... 21E NAN Oiba,._D~.l and and,ocDI Plot luell, 4 crops pet anon (in same instances 2 cont, per sailor)...... 24,657 257.711 Tobacco fast,, total...... 2,137 . 585 4,212 liarcot,cs manhuanei . Intel 1~...... 1 .936 2.075 Cipareft a. to at- ...... 2 : 03' . 1 OG 2: 0131E:lf,01Be 7 257 Small (Class(C A), 34 Per thousand ...... OF2.101 2 gi ani : . . . 719 818 Largeof l . .lass. 0), $8 4 0 per thou sa no . except it ever 0!,1 inches long $4 per thous, it to, each V, .,he, or Pact- there- 1 6 Cmn :ppospr~a ro~ed amusement devices $10 per device, por year, bowling alleys, pool tables, etc, $2o pe t alte) or table, per year N . 14.25,27 Pepro'nnersis : : Coi ed ...... ------12.34535 ------Warr taxesuo'Don: Colors, total- 54, 220 56,834 Occ al tax, $51) per ...... 354 wagIrpoll) percent of amount wagered- . 4 32 8 4. Large chars, total ...... Us. of t1h*11 t,'111,clss we, hing by 126,000 pounds, $3 per I,GDO pounds dProb year (installment p-Ileves pcrputbd) ::~ 124:?,3 135, ...... "721'R''R "" 1271f, C11~1, .a A E(1 .1eyor ver., .1.1,, ceps bach). $2,5D per thousand . . . _ ...... ----_ . : _ : 4 Adfiuftprt~','ed lb~pi and bit chre,stax', (inolm'~'~Dyd and domeafic). onoress or renovate utter and imported oloomarg-res' ._ . 13Sit 2,11! on 4 eent, each) . $3 per thousand ...... Free-1 t,ansf 'eand oirocipirtio,all '11' ass C (0 6 Pal canan p : 12. Merest ...... 111 .6885" B85 .9606 no " .1"11 1918, 4 14 1) (0,P; " c'e'~!'~: ,e' ;I8 ~a' rect)). $7 , :, lh'.'u. T "I : : : ~ ~ ~: ~ : ...... 8.770 10 402 Uvoll'orsig, insurance --- Class E (Over 8 comar but eye' . 1510 sent'Do or ,ash thousan d 2,878 23 288 a s shoul excia, pses . - 9,458Z 38,' 0 59 C 11, 111) ; 121 .1m;x net D)$20. each),)' $10$15 Per on, ftb- c! _ C PoWe 0 each per thousand ...... ------3 ". 515"' l",3 5 0 See footnotes on p . 120 Small coats, 75 cents Per tn,um,d . ., ...... '141 ~112 ImportPrepaymentsofxxvgar,=ts,,. cigarette paper, I~J uarellfe tubes, (collected by Customs rates some as dome"ic) _d 5192 ci [Ig3refte vapors and tubes, Papers le cent per 50; tubes I cent per 50 ------...... 1 669 756 Stamp faces on documents, other exPuments, and p :av,ng cards, total I- ...... 1,455 220

So, footnotes on P . 120,

Annual Report Statistical Tables 119 118 / Annual Report or Statistical Tables Table 4-Anternal revenue collections by principal sources, fiscal years 1940 through 1970 ~ Represents credits allowable oil income tax neturns for erriployment taxable income. The 10 percent per annum 11, liteitsaiels .1 dc,11-1 certain eawlinc and lubricatirig, oil tax payinums and lot surcharge added by Public Law 90-364, effective Apt . 1 . excess payments under rite Federal Insurance Contribu- 1968. for individuals . was extended to Dec. 31, 1969, at I Ac... .d , Otilt, W- 6-Act (FICA) . ,I,, sanic annual race (Public La, M-lac - 91-53) and the,, total ntdrn,l 1,111pi- 0 BIA, snd Alc,hol T.b-r, timo, All .1h . , ' Ac is of internal reveinic ta-s collected on extended it, June Al . 1970 (Public Law 91,-172) at a 5 FucalI Ygo., ii,dsd -nu , Cil'it-o., 10,0dual ts- - gift Is- Wes - I .- - . .e w U- .ll~tws T.Nl inc- c .d .-ril 1 . Puerto Rican pioducts transported to the United States pen-ent anneal rate . linchl, W . .. c Iss ., or , onsurned it, the island (less refunds. drawbacks, and c"Rate, of tax are as follows : Income tax withheld : expense-0 ;-, --rcd into the Treasury of Poerto Ri- July 1 . 1907, graduated withholding, 14 1 . 33 (it (?) (3) (4) (5, (6) (7) (8) (9) .(to) wide, piro,nmu, of &- . 7652ia)13) and 5314(it) (4 c of percent Of wages in excess of exemptions (public Law the Internal R,%eji,e Codc of 1954 . The gross amounts 139-M,H) Uld-ag, . su-ivo,s . and disability insurance S. 340 42 2' 129 609 1 147 '92 982. 017 833 .521 360, 071 624 . 253 608,518 447 . U&S 337, 392 7,370.10 3 421, 124 21053,469 1,417 . 655 925, 856 407 OSH 820 056 G99 0 77 617,373 430,564 are included in overa I I col lect ious results ( tables I taxes and hospit-al insurance. taxes oil salaries and wages 4,744 083 1942 . 13 04T 869 o0c ; 884 3, 262 . goal 14 85, 362 432: Sit) 1 .048~ 517 780: 982 771,902 821 .682 1240: 1711 2 :11 3"1 16 o",211 :802"1 ': "Ir 71 ' 6. 1321 g12 Is 7 0 411 496 1 .423,64 6 923. 857 504, 74 6 1, 274 thlough 4 ) . bcginning villi 195.5 dw,, separately a?V 511hite(ed it, a combined tax rate of 4 .8 pereent ( 4 .2 760 1, 766 96 : 372 511 ~ . 04 8 .M . . g I 'GI : 005 1: 738 210 1,618. 775 9&9, 483 503,462 1 . 733,655 it, 1 .1,1c B . per-it for so,i .l security and 0.6 percent fm hospital 194~94 . 43. 809. 388 35,061,526 M 027. 213 19,034,313 1 . 779 .177 643 055 21309,866 932 . 145 782,511 2,292,108 * I-lo ties oc c . pat to .ml I ., oil roc to, s of , til I s, insuran,c) . For 1969 and 1970 tliv tax applies to wages 40 672,097 31 258,138 !2. 553, 60? 18,19 704, 53G 1 700 SA 676 832 2 .526,165 1 . 1652 Si g 922 671 2 421 94 4 whoh,salc liquo, dealers. retail 31" : 103 39G 29 019 ' 75G 9 676, 4590 20 343, 297 2. 024 :365 7 79: 291 , 474. 762 3 37 : 768 1 . 425: 260 2 : 147 : 18 4 nectiffi,cli, dealers in liquor up to $7,1100 paid bv the cinplovel, and received by the I gNI1 - - 964, 541, 31,q 172I 1 119 1 174. 41 997 . 78 1 2.381,342 . 991, 34 5 2,255, 327 UO, 28 0 1 .649,231 2 .206 .82 3 or crediri.al spirits . and uzioui .,,ureis of eniplo-e . in the cas, of w..gr,; id after the Ifith day 1949. . . . . 40,463. 125 553,669 18,051,822 .1,476. 113 796, 533 2,210.601 321,875 771, 533 2 .280,969 spirits. following criact na of Public pa- 90-36,1 (e.art,d 11So:411415. 132~ 31 7 . 17 . 111 3(18 51"5g 111 227 2 219 202 1 328 464 836,053 1 17 159 lorSU 351 2 .214 .95 1 " Includes sci-es . penalties . t, ., and tax ,it stills or ! 'S, ol : . ,384 : 79 4.387,569 122, 937 . 309 I3,62 "'7: 729 :730 2. 546:808 1 390~ 396 2 383 677 2,392.719 June '18, 1969) income tax withheld was adjusted to in . . 107 1112-- 65, Cog: 58166 50, 741 . 017 21,466,910 29 r 2 74 4,464 264 833,147 2, 549,120 1 565 162 2 .348,943 2,507.933 condensers manufactured . chad, tht, sm-charge . ~5 3- 69,686 535 54 .130,73? 21 .594.515 32 .536,217 4 .718 403 931,284 2 .78U,925 1 654,911229 2: 862 ~87 8 12 . 1954 . . 69,919,991 54,360,014 21 . MG, 3?2 32 .813,691 5,107,623 935 . 121 2. 7934 012 1,580, GR9 1 33 .111'47 : g5sas ` Includes occupational taxes on u,holesale and retail ~ Includes i ailroad emplo vinent coinfacrisafion tax, 9 .55 195519 . . 66~298.692 49 914,826 18,264.720 31 650 ID6 6 219 1 936,267 2,742 .840 1 571,213 2,885,016 2,018,866 dealers in wincs or it) mines and be- peo,eni for calendar years 1969' and 1970 . Ta . applies 35:337,642 75.112,649 55,636 IG4 21,298,522 72111 714522 17177.23g, 79 2 :"311o : 11 4 1.613.497 3,456 .013 2,019.380 ` includes -eupalional taxes m 1--t-s and h .ld,ale I,, employers and ..cpl,,yccs, i posed II-ble pm-timi 1179:g 1I7 s : .177 S1 11 .11 .125 21,51o.gll Is, .1, 111 1 . go 1 95 1 .674 .050 3,761 925 2 243 856 MS . 11Is: .111~1~ 112 4 11,1331 1 : 31 6 308:568 559 8 644 386 1 410 92 5 2,946,46 1 1 . 734,021 3:974 :13 5 2:166:67E and retail beer dealers. of wages. Almi, effective Oct. 31, 1966, includes (a) a 1959_ 79 797,973 54 8, D9 509 4 734:744 8, 853" 744 1 : 352, 982 3,002,096 1,806.816 g 58,789 1,997~292 " Includes taxes oil domestically produced cigarette suppleniental tax on inctum, on each employee representa. 11 91f :771 : gU3 G7g 125 IN 12 ]Is 414 44 945 71 1 626 4 58 9 348 3 193 71 1,931,504 4 735~129 2. DM, 39 4 papers and cigarette tubes : ta-s by Custo s ou 6- equal 21 :764 :940 46: 153:001 1,2 : 15"02.451 1 : 916 39Z 3 :212 ' 801 1 . 991~ 117 455: 1116, 1102 1,963 to 2 cents pet man-hour fin which compen- 401 0&6 717 917 941 23,295 711 So 649 594 .1.2 199,440,839 :945 305 12 708 41 87 ! 2.035 187 3 341 282 2 025 736 2264,81 7 imported cigars . rivaretles, ci careto, papers and cigarette s.tio. is paid to Ili : ad 00 a s .pplentental tax imposed 9634 IDS12: 15,39 5 75 323,71 4 22 .336 1 3 52:98~7Is 3581 1,5 ' 004 ' . 187~457 3 '47471:654 6 2:07905? 237 78,53 6 610 309 tubes : and miscellaneous tobac-- oll-timils. on 111 260.257 78,991,218 24,300 :8643 . : 54 1002,504 2,416,303 3: , 99 2, ~ 545 6,020,543 2,299 .64 5 each cinplotea equal to 2 rents fm each nuut-hia., for " Includes taxes oil fishing ccluipment, and taxes on the 1161 .- 1 124,8 il: 96 346 1 7992: 71392 01 6 26 131 334 53 660 683 11, 111, 3OG 2. 745,531 3 .772,634 2.148.594 6,418.145 2,453,40 6 which ( ocupentaction is paid to cipployces. Amended by 96' 79 1 :794 301834 :243 61 : Z97: 55, 3 093,922 3,814.378 2,073,956 5 613 ' 869 1 895, gl e following items which were repealed by Public Law 1 90 Public Law 91 - `J 5 which the R,iihoad Retire. 1 548 374,81 5 104 288 420 34.917,825 61.370.595 262" 958256 133241 3 014 406 4: 075 723 2 079 869 5 478 347 2~ 4I'1 19GB: , 1 3 .919,56636 8380 108,149,56 5 29A196~520 73,252,04 5 28~ 085 898 3~ 0110: 91 1 4 287:237 2 122 :277 5 J13~97 3 1 6 90"9 89-44~ Phonograph records. musical instruments : sport- uu,ru Board to deteirmirpt the at(- of If,, suppl,nicrital 969 1 1 1 7 11,012 38,337 .646 97,440,06 33 068 657 1 " 065 4. 555, 560 V 3 g: 6 8 2 :137, SES 6, 501 .146 12 3IS8401: 11 I1 ing goods (except fishing, equiputent I ; business and store 1970. 195,722,096 8,568 1 35, 0364 983 1 303, 651 . 585 37: "q: ]all 3~680l(376 4.746,382 2,094,212 1 6,683,06 1 : 3 s I:. . b,gioniog Apr . 1 . 1971). Further includes railroad machines ; ranceras, lenses, films, and p-jermis ; clectric employees io-p-cut.livi, tax, 19.1 pelo-cm fm calendar light bulbs, and tubes ; mechanical perells, pens. and years 1969 and 19711 ,,, la-ble p-tim, of wAg,s , lighters : platches : radio and television sets, phonographs, " issues and transfers of stocks and honds, repealed, : refrigerators . freczers, air-conclitioners, Footnotes for tables 1-4 components, etc . effe,ti- Jan. 1 . 1966 . Deed, of Onvcvicrce,s~ $100 to etc . ; electric, gas and oil appliances. $500, 55 cents : each additional $500 or fraction thereof, N.,c .--C ;:,Ic Ito yeat figures. by egions, di,i,i,ts, ' Stif-cinployractit tax and taxes imposed by the Federal " Includes taxes on luggage . fills, toilet Y) cents : repealed effective Jan. 1, 1968 . prcparatiorls~ repealed effective Jurip 22 . 1965 (Public States, and other areas, fit selected types of taxes inay Insurance Contributions, Act are applicable with respect ~'Cutimg ()it. repealed )an. 1, 1966 I .Public. Law Law 89-41 ) . be obtained froin the public Information Division, int- to Guam and Ainerican Sarnoa, Amounts of such taxes 139-44) . " Includes taxes on adulterated better and filled cl- .oil Revenue Washington . D,C . 20224 . collected in Guam and American Samoa are emobilied . under the Revenue and Exlwttditum Central Act of I imported and d .ine,,tic) . pi-e-Is ,, 11--ted bull . and -1-s than $500, with similar taxes reported for Office of Internati-al June -18, 1 968 (Public Law 90-364 1 rate csi,),,.d retro . ` Rc,igcd . imported olecroargarine : firearms transfer : and occupa- Operations-Other. ,actively, to 7 percent, efflective through Dec . 31, 1969. I Thc I .ecipt, in the various States do not indi-te if,,- tional taxes . ~ Beginning with fiscal year 19 .37 . the United States total This ,I, ,as extended to Dec . 31, 1970 by public Federal tax Imoden of rach, inrc in ... .y is adjusicel to exclu le withheld individual income uxes ` Corporation memne tax I ates : Effecti%-(! Jan . 1, 1965, Law 91-17" . Cl'h, Tax Ref-to Act of 1969) . wxes at(! reflected in one State from residents Of anOther first $25,000 of net income normal tax of 22 percent : net transferred to the Government of Guam in accordance ` Repealed, effective June 22, 1965 (Public Law State . For example, withholding taxes reported by m- income in c.ce . of $25 .000 -robined milrut .] and scarta. wit1b tile provisions of Public Law 630, approved Aug . I 89-44) . ployers located near State lines may include substantial 1950 (64 Stat . 392) . '17his adjustment amounted to $11 .1 of 48 percent. Normal tax and surtax also apply to net "Air cmiditi,in-, epealed, May 15, 1965 . am. . .ts withheld firmu salades of employees who residi- mi Ilion for 1970 . income dc,i,-,d by exempt ot-g-iI,.lions feet,, Refrigerators and freezers. repealed, effective June 22, in neighboring States . " Tax payments made to banks. under the Federal tax unrelated trade or business . Effective J an . I , 1968 . it I () 1965 (Publi~ Law 10-44) . - Includes tax oil orlielated business income (if exempt deposit system or the priot depository receipts system, are percent per annum suicharge was added to fit,. tax . ~ Repealed, effective noon, Dec. 31, 1965 (Public Law opicailiIations . included in the internal revenue collections for the (Public Law 90-364) . The If, percent per artruni sur. 139-44 ) . Collections of individual inconiv tax not withheld peiiod it, which the Federal tax deposit is purchased or, charge was extended to Dec . 31, 1969, by Public Law Repealed, eficuive Jan. 1! 1966 (Public Law 89-44) . include old-age. survivors, disability, and hospital insur- the depository receipts were issued . However, such pay . 91-53 and then extended to June 30, 1970, by Public Law This In. was ontinued at 10 Percent by joint cso- ance uu,cs oil self-cuipluynient iticone . Estimated separatt ',,cuts are not classified by internal revenue districts fror 91-172 at a 5 percent annual rate. hitimi (Public Law 90-285), and thc Re-mi, mid Ex . national totals I'm individual income tax and for old-acc, 1". tax subcf-es to which excise tax payments relate) " Rates of tax are as follows : Individual inconte tax : sur%ivors, disability . and hospital insurance w .es are until the Federal tax deposit pacynnot is applied to the Effective Jan . 1 . 19G5 . graduated rates froil, I I percent pecclitul-, Ccoul-ol Act of June 28, 1968 (Public La . snot- in the text table on p . 15 and ;in- used in oluairing taxpayer's liability in the internal revenue offices or the on taxabIc mccuic not over $500 to 70 percent, oic amounts 90-361 10tich extended this rate through Dec . 31, 1969 . national totals for individual income taxes and cuiploy- dcpc~ilary receipts am received in the internal revenue of taxable income over $100,000. Includes old-age . so, . This rate was further extended to Dec . 3 1, 1970 by Public ment taxes in table 4. .ffi"s with tax reour- vivors, disability . and hospital insurance! taxes on self . Law 91-172. (Tio, 1' . . Reform Act of 1969) .

120 / Annual Report / Statistical Tables Annual Report / Statistical Tables / 121 -' Repealed, effective July 13 1965 (P.blic Latu, 89-44 ~ . on or. ..f.curress or dealers it, thes, 1-ch-B oil a,,- Table 5-linternal revenue refunds including interest . .'Narcotics, I cent per ountc : narcotics order blanks , incl lcd in the act ur, slo-a , Ina thms .nd, of delay) $1 per hundred . Mariana- $1 per rnarihir.ra "T,atrafers of Inachine goal, sh-t-l-reled fi,varnn, -der W.nk,, 2 c .r . ealia. Arrourly sly-n .1- inchad,, silencers, etc ., $200 each : certain guns ,,ith cornirina- Indnidual m,hro an d o-pation.1 ..,e levictl on ounalf.enar-, dealers, and lion shot~tui and illc I-els . ad - .th .I special tyl- if omloveeeml t,,, & area C=O h plactiti(iners . Fur classes and rates of ocrupatiunal t:,xe.%, fimarns. $5 cach . Occupational tantes am lc%,od, s Total :oii to single dishi.is indi-ad i n ut. ill ou" I ace table 14 . nianufacturers (States -mrsintod Enen w . iinporters . or dealers in fimarnis arld am pajoureses ; total for othe, States shown at botto m pa"~"Ommy Onto , " Adulterated bull,, : 10 cents per pound . Procese,d ch, ir(lud,d in the anhount sluovo . of table, 2) (3) (4) (5) (6) (7 ) renuvared Inatter ; V4 cent fact- pound . Doinestic filled ~~'Negari,c figla-., (-cluding unapplied c.1lections ad cheese : I c,, .t per pound . lunplorted filled cheese : 8 , cuts el-, -1 ...... undistailauted del ~4,ry receip,s) ster, pl-interily front yona- a .vyl .sya, .I .M."ger 32 .51g allyst lou ..'all per pound . linpurted adulterated butter and olenniat- floor stock mthu tak,n (,I, certain taxes repealed by the. 14-h-AtOw.- 11 .9- ~ ------2- .274 Iss-I ~ .orl1 1 -42 garine : 15 cents per pound . (-occupational taxes am 1-ird Excise Ta~ Albany . . ~ ...... (See 0) bal-) ------113,121 6,205 0417" 1 : Z39 Reduction Act of 1965 . . (Memo) ------. . 4415 55f testa ...... 55 344 3, 583 50. 687 332 IGO A u 7E Boston- (Mal-hosartts) ...... 4 55 . 9OG 62. 5~1 382.380 6.168 1,176 89 3. 543 B (5,, (0 below)...... 518 387 32. 44? 471 360 5. SO -1 1,199 103 5.774 Donato (See (0 below) -- - 344 . 558 23. 168 313, 195 4,395 577 B o autme ...... ( ermon ) . _ . ------zi 3, 2 2 d V t 24 .69 3 1 .590 22. 691 311 65 ~ 9 Hartford ------_ (Gimeelfireet) ------266,897 19.400 237,098 273,325 1.023 M.Ithaft...... (See (C) below)...... 40 6, 01 0 915,464 493.171 38s. 769 797 2.710 157 6,861 P.,11mamth ------_ III- Hahrp~hlhu ------50,369 G, 355 43,424 142 21 1 26 Pre"thm------(Rhode island) ...... 70,535 9,89.11 59,672 769 49 150 Mid-1--Balthea- Fh,h___ ~ ~ ------. . . .. a1 .131 . ..? 33 n. Dayton...... ( Marylan( 0 eyan)d D .C I . . , . 34,2 52 75 Now Jots . ------39)572: B3863 50.31,1 Iqq~ l371 B 4670 1,42" 13 151 Phil,hhhdh,a (See (o) below) ...... 583 .630 106 418 456. 610 8 129 1 56 Pittsburgh--- (See (e) below) . - - . _ 32G . 37G 40,851 281 .632 2.30 952095 7 1: 003 Riehmond ...... 778,70 3 22, 34 5 250 225 3. 061 5156 10 2,50 7 Winniogem : : :7 D .Iaw 1 45,037 10.864 31,435 2,201 75 ...... 3G2 .-h.. .I Is ------__- 1 .431,572 112.- At !.nda ...... (Georgia) ~ ---- _ ---- I" I, MIS7 257, 113 3a . 515 215.177 '4 :022"' 151 19 3.228 Bi' inuglem- - - ~ - . ~ - (Ahatrano) . . . -- - 163,833 15 446 144,892 44' 1 1 283 .Ioretbw ---- (Smeth G... I a) 1 : 413 890 Glen 12 486 's.'enn,l,,,-_ : :Horth: :~ Ginolona) . .- I2 30": 2BO 21:11131' 1. 1BB"1 73 365 29 6,13% Mississippi). 89,594 4. 293 8? . 787 2. OGI 86 16 351 Jh,ksm ; -.If1_ ._ (Florida)I ...... 400.431 31, 374 359, 138 7, 192 1,848 28 85 1 _% ;hville...... (I ehne .,e)- . . ~ ------183,664 18, 3G7 160 .4911 3.177 3GS 2 1 .263 3- 2 .1.061 t .int .yers a, a1 .9 11M, ~mmnabCity "24-_ (See djbeIowj:: 24 503 38. 363 278 .339 3: 78 '.137 6' 1 1 3,613 Dogtamd . ------(St . (it) below)------550,959 103,528 437 .567 6,403 705 38 2. 71 7 to it ------(Nt0qah) ------1: 72 3 04 0 1421 7: 46 Indt,marihso . ------(Indiana) ----- : :. : _ :. :. :. ~ .7 21 113 3097 7 '5: 326 .91 2 3 999 to.-d . . . . - ---- (KanIuhky)_ 156.724 10. 99b 141 06 2 2 . 527 467 1 1 .672 or=,sla, III ...... (West V ginia) ...... 83.005 4 .370 77,223 796 165 5 446 2 .1n .121 298.US I .M .- 21 .13AI7 6 2.95 . .,0. Amorde i t 25. 039 951 23 48 1 4 6 8 1,2'4S Chicago- ( SnaSea (b)" Uake")below) ------766 402 11-1, 156 628,269 10 .114 779 1,) 105 Day ft .- --- 0...) ~ ------145.922 13 .915 1 ?9 . 053 2, ?73 205 10 532 Fargo- in Da"u). . 23,639 BID 22,083 617 9 C 1 4 3 Mil aui, Wi-inin) ...... 293,301 41,895 247,057 2 . 879 611 59 719 Omaha" ------(Nob,aske)- In, 706 11,73 8 67,759 1,48 1 29 8 6 425 S on . . . . . (M-asuh) _ 339,833 63,900 261, 155 4,686 454 829 8,91 0 SI : L' U1 ...... (Mi.. . .ot') . . . . 266.257 32,870 223, 213 3 . 155 323 5 6 69, Siangfimid (So. (b) 173, 024 11, 218 157~ 759 z D54 249 a 1, 72; la .h- - - tLAO: .T iTIM, 1 .g.s .rsea 31 .07 11 .1. 131 9 .1r , At1, uqueram _w - 55 890 1 . 553 53 .117 1 .028 13, GO Aratin ------(See (1) b,lo.)_ ...... 175. 877 50,296 312.097 10, 278 575 25 2,656 ch-on, (Wyoming) -- - 18,966 217 35 1 57 4 1,0696 3 Dallas __ (See (I) below) ...... 305 660 5 1 ~ IN1 61 3~ 33I'g5 517 4 . 6252' Deny,,- (Colorado) 161. 209 17,776 1" 3!1 ~- 23"1 ID III 312 217 13 Little keti- (Arkansas) . . ,...... 76.941 1 .111"7 1 11.: 7, 1 .113 N-Od.- (Lthh,io.)_ 202.928 "14 4 . 11 5 2 .3 1 3 Met- GO (Oklahoma) . .. 14 488 1 : 14 17 jill~. 1 , 1,313'B 1 ."86 1 75 Wichit" Kansas) --- '3~ 489 05 958 11 :17 '5 3 12 W 3 ------_ - - 3,392,3% 2,11U .8411 57,115 6 .2U 413 11,74 '7 161 66 5 (. I o he) 998 1 37~ '15'7' 1 711" b2 Hot...-, Moinna) _ 11: 216 1111 ~'71 " S1 31'~ :11'gS1 1 36 3 M 4 rmnolul ------(Hawail)------1 13 1 Big 4 8 "s ------(Sl( ,.~ ola0 Iho' I*) ...... 1 .691.11 2133 : 11 1 1 31, :311 1 1 711 2 . 4"2,11 1712 3 .13 0 men! A, M 'GO 7 1 3 43 8 7 (Dome .) 117'145,399374 13 .091 IZ8,505 31 41 9 22 ,6 BeS he-- 14-do)_ 54. 543 3,996 49,028 12 33090 14 Uts MIS B 1 '0415 13 6 S:'~' L le~'?;) 82P 7 7" 7B 771 14,95 '1 II11B 7,43 25 '.Soattl'. Washington) --- 292': 33MZ9 377 ' .32" 1 24B,159" 5,456 763 20 60 .1 1 . '1 1 ...... IMIUS 4. .' Ing ...... is P-~the . Ri - 11 7 2 I 1IG3. .36 "1. Iri 6 62 .2 B .S1I. . B12 ...... 4 It amd . . . FICA -will. S ri~ ."4 ...... 1 C ......

Total to, Sales hot thowm a.. . e

(a)Wcalimnta_ 2. 517,446 373 . 359 2.090 .875 38,699 3 . 752 299 10, 4G2 (') Illinois-, .- 939.426 133 .386 786 028 1 .028 2B113 2 ll~7: 3101B3 1,891 .530 554 991 1,276 000 312' 1 " 4,111 11 NewOhio yet k- 875,46910 .1 1415 :21~1 '1 1,.: 7" 49 G.350 ptmms~il ;. 1 : DO 6 "I7. "I 10gG, 4'S.7 3 7 12 11mTe'am ) .. . ------537 101 812 550~ 21174 2 1,644 82 7- M5 "g

Fulue,des draw1500 att.s . Ishasom bay. hot been otd-d to refto,t reimbursements Ilon, F.d,ol Old Age and S--oi, I - dool Disability and Federal Hospital Ins'T"C' Insl Ful"'t, . itht,ing to It T338I.034,000 in 1970 anJ ;SO14070,U 1, 1919, 1- in, 11144-y Troat Fa" heminting2 to $ 3 .071,000 1. 197U and $223,755,000 in 190 : and tome the a Net of 11311, 5)~rmmMing to $6,500 M 0 0 and $6.852,000 1. 1969. 1 .1 j Ili-abl. ei dap-ol UlAing $14 132,0 0 122 / Annual Report / Statistical Tables 1 too: styasR.,,MnI I "' I on "not, la, 11hun, let unt.i. g .adm. and hlb-Amg oil U, p-tients and lot -ass Setut Socantly lwymens unde, the Federal a A"ti(r1'CbA"f . Annual Report / Statistical Tables / 12 3 `,M_[`rl 0 - It - ~ by Table 7-internal revenue collections, cost, employees, and U .S . population, 1940 through 197 0 Table 6-Number of returns filed, internal revenue regions, districts, States, and other area s I Number Internal revenue taln .ol districtsga . States and othe r beclarat on .1 employee, s or esti. Cost at IPaptaxt- to . Dindividua.. . is,l r Corporation Partner . mated tax Employmen t Estate Gif t Eac.s e Do",ang!"', a. C.Il .lipos an eating Ililuslods) Il e income tax shi p add .11 1. . .. at F. ..I Year $1 00 a Pa. total N .Ii Dal Fiel d ta x taxes ific e .the , I nation V) Slatespldienthid , bl represented... S; a byto, sin e districts indicated i n taxes I (1) (1) (1) Q) I-) C) total othIII a, States shown .1 bottom ..) 1) 2) 3) 4) (5) 6) 7) 8) 9) ,. 1940 ------19 1.7~1 : 1~ 111~70: 412081 11 : 1'1' 1 12, 3 ~Ill114. 11~,~ 1014 2 17 : 411 3 .993 19.43 1941 ------65 S2"7 :17" 7 , 1 230 4,151 23 .0709 etwian unified Staxa... t .tes . ------III .R711.1in 77 .213 .rlull 1 .725 .7" 937 .31 , 1 .U8 .4,s . .$,1.118 Mr. 15M ., 4 71g : 7', 4 3, .043 ba 1 311 1t31:31 3 . 30'5 4 . 329 24 .73661 ------1343 --- 093 12 21.. 711.386,4"' 'I19 $ 44 .373 ' 2 00 2'G M 4 2 131 :1"R 129,941 .848 40.121,760,233 .32 138:910 288.82 46.171 4 : 3 173' (Saj (cl,6iil 18 .3S2,SS5 5798 12 ."3 .220 4M .S76 IMAT O -1 .7-an 3-M2.91 9 117: .1 IgS. .2 a l 910 d 375 : ::41 .41.390,720 13. . 3 11: 411, 1381~1~ 11 49g~ 61~14 4,: 1"4 37bil 1, A gusts .. 1 .7NIII 74 11. .14M84 I2 :"111 4 2~ 151 111 11: 1 1~1~ N 11 . 1946 174,795 .640 4o.171 ..D9G3 "'7:9 99' :43 411, OD11I 3 4 '4 : Boston. . ('( M .a t 3 . 158.495 ... ~ 54 2 M 11~: 47 1 1, 8'91 4,0 l AG: 16 .82 2 .74 .52 14 270,28 11 13 1 77 1 BrooklynB ------(So . I,) bd- : 1I . 11 16. 111 2 . 112 go 18 217 31,: 11, 4"111 : ~1 g11. 14: 111 4 . 54d 1947 ---- - 203.915 39,108,385 2 48 .059 11 . 1g2 2 31 52: 1 43' 462 (See (c) below ) .. . . _ _ .34 809 1.798,94 1 37 .436 115 .832 4 299 1 . 21 1 3,7: o41l, 1948 ------...... In,III : 27~1 51 :01 101: 1 : 14.2 1, : 2 19 4 7 . n4 l l auLiff 1 16 ...... 1949 --- 4 4643 0 91 : 1' 1 19 767 27'0 7 ~2 266 4,554 mill. 11' orent) , ...... 3 81 . 211.. . 71 1 15 47 , (Cormiali, I . 21goV: R'IG 1 . 338: 114'1 31 ~ 14W' 13 :1 ' 31 , " 13 71 : "1Its 1 4 549 26,665 151,271 (0 hot..) -- - 3 4139,: 11 1, 2,11: IZ 830 35, 517' 156.681 1950 . . . 130 40B,1~ . 1 31,11744, :611186 .718 .59 115, .1111,, 4 4 1, ,Mindimm" f id,. (See 5,297 10,518 49.903 1951 245 .53 8 50, .31 5 .4 1514 2", 21:7"1 1 '1 : '7 S or 'pro Mo . H-nnpshni!) . - .,.a 7 .111 2, 11 1 5,11..1 "I83,26- 'IS3 31 4 : 13 . 833 111,1372,191 65,DOI,585,560 42' 7 151.. 412,62 55:370 3,083403 . 2 1g ,xiP rovalence ...... (Rhode--- Island) . 513 3&714 2379,2059 2 . 126 10.861 99 .972 573 467 G 13. 268,590,906 69,696 535 .389 9 :38 160~184 53.463 4g 2 .,no D.~.) 112 :1*1b9of:871 71 11 :21 I 2a3irl :ITO I.W III 3 .9da,xill 15 .362 17 .114A 269,969,107 69.919 .99D,7 1 .38 163,026 a42B "I 'll89 51,411 2,70'37' altimore . . 1 9581 ~ 7"52 go, 898 ,21 , 36 311 512 .423 1. 11 1: 41 1~ six21as: 7'II"I 1954 ------48,70 4 Me (No. J-br) ...... 3 . 335. 1072 21 .2966 1: s22715 71~731 : 31 1 13: '1432 4" 14 1I1~1~:8 1934~1: 2787 66.288112: 692,000 .42 165: 931 399.50 50.890 2 48,214 8 5 iflp hiii: 12g ~ '1 : "Ml7 Id . 7'118 Ig .4'131 2, OGO 47 , 1955 . . . .6753 Phil .d . . . . San ta) 9 64 1956 . . 0 75, 649 .000 40 16871 .98903 44 4 .71 50,682 2,59 Pdt,bR .,gh .- . ~Sca I .) bar" 'W)-.. ) :- . 12 Hito n 1 .751 .279 Z2 .21 3 12 .542 '34,9 331 424 , 594 2,01 39 11 ~ 155 1957 ------...... 305,53728 .91 4 80.171,971 .000 :38 4 466 51 6D1. 48,762 k hmond ...... Vi rginia) . .. 2 . 2211 : 1 1 . 642 364 286 :38841 141 .06 22, 402 477 ,201612 2, 043 2, 088693 3 2, Olk i 1958 . . . - - 3,~337 .1inig : 2271 .1 7l7g: 177917 : 72I7&414 806 .42 114.882 457A, 50A" 16 2 638 48 .17 6 Wilmington . . . . . (Delaware)- 99 6732 209,' 456 .600 9.489 68,124 13 .388 28~5011 ~ 211 1959 ------...... 44 177,830 448.73 50.200 2.633 47,56 7 . .a , M .7, 2 .3 - I : NI '. 7:531.: 38'9 "30 :67' 29 'I1 .h :14'1 "237 ~ 9' 397. 1 - 5"473 . 6 3 7 1,643 2 .880 29, 776 1960 ------313: 131 311 gI,171,~II2,123 41 1 3 50, 199 11.2 4 7 :649~ ~ ...... 1,49Gr657 1 .067, 703 17,360 11,627 12 1~: 117 211 3,111 9D9 1,628 21,492 4 N99 : 014 .0 1 :11 15 :4 1 .~ , S's 513.73 ' so Columbia ------(South Carolina 21 : all~G, 1 1 1,7112 66:117 33 1961 ------295 . 238 13 IG 507 9 53. GM 3: 3 1962 ---- - 450,1180, In 440, 9839 2 4 .45 532255 7 5 56.51 0 3.357 53 . 153 Greenstiolo (North Citroli 074 1~'3 17654 " 23~138 5.86 "0 11,' :12'17 2,'0"17 13 115 558 '12j : -87 3 189 417 2 49 3: (Mississippi) 979,755 ISOM 171~ :117721 217 .,13,.3 1. 313 1~ 28 3553 : 017110 5 1157 5 G,g792 1 1: 1963 ...... 4 : 131 1 115 111 .3155 56 924 1964 ------So5490 ,692S o ' 1 : 497 192,120 SRI'19A 32 ,, 7 3 7523 .Jackson...... a linill) 31: 8181,1 :1413 59 3 04 56 485 2, 260, 2 7, 1 ] 5 59: 35 S": 604 c-teMNa,hvill------1 94 12: '35'3. 292 21,092 21:250 16,911- 433 .435 1 .494 1 962 28,52 1 111 :RSI317 : g7lIs 114 414 :11 :713 4 21 , 194 592 588.07 60.3110 3.11 CDC la" 11 as, an 20s,"s 1235 year IIU9 977 2 rall .al 1 15,7302 162: M 203a 220 1965 ------...... 624 2W 879 9631 11. 96~907 654.52 '8'7~ as2 ;2'9'2 :7'4 0 1,758 919789 M 1966 --- octal "I : 60i (it) balow~:. 1197 .0110 :29 5 M.174 .814,55 2 4~1 416d Got: I 11, el ,' ".1. '11MI., h(l)go 111Dv)...... 3 .169 .S46 2, 405: 351' :4'08 24' :.US I S 49. 4'220 45'1 : ' 3 7tS"n 3.97' I46, ~ 1967~ ...... 69 "10?:1 1IT' 65,1 27' 263 003 3.294,886 55,876 37.9: 11 412li.17 7212 7114 84 :4575239 3 :664 4.727 57, 8 1968 ------. l 90 304 153,636,837, GO :4 'MI2: 6'~1 3,939 C, S 15 4 39 111 11 .711, .47 1 1117,919,559 .66 8 .40 203,21 3 -924.74 64.507 4 .037 47 C nifiamitalbord"thi. ._ . ~. . . . . (Indian .) a 538: 239 1,943.G71 35 .995 8ffi 69 . 077 3,423 2,816 36,66A9 952.23 . . (Kentucky) . ------1,455 81 3 1.06 14 :782 317 750 1 .482 11639 20,04 3 1 9709 B86, 59,162 195,722,095,497 .45 205,395 69,0911 4.356 la13 : 74; keddliveParkersburg ------(West Virginia) 797,411 5930:181 235"ll12*" . M"'g 165"1,11 .' 13 I .ifa,11.rn.047 16 3,872 649 678 13,44 7 ., IG .8. All It g`l an 1., 2. ."a Aberdeen ...... (South Dakotaow)) . 247: a 4,34 3 85,7. 674 595 , .I.7 1.. ,1.1. 4 .~I`93 7: 1 M2' a 36 1 g:o322 47': o." g1,700 1114 :,111 7: 451 Table 9 .-Establishments qualified to engage in the Gas all b...... 1,507~114 1 1 087,67-39 9,45 5 11,474 24,71 9 325 656 4 : 1 '2 '1 2 17 2 91 5 Table 8-internal revenue tax collected on Puerto F ...... _ : - (North Dakota), ...... 326.768 . 225.953 4 .305 4 .964 3. OGO 80 87 707 5927 Rican manufactured products transported to the production distribution, storage, or use of a lcohol 695.701 38 237 19,808 41If .117a 3 .466 3. 68 46,4 1015 1411-oke, (W-D-) . . . 444187 : 1 7 U ited States, by objects of taxation and alcohoiic liquor s maha ...... (Nebraska). 73 65504 580,046 1,12 1 12 .94 1 I.D92 17, 0 St. Louis -otrfi) ...... 2,412,792 1 .740 754 22': 7' So 7 :714. 511.654788 766 32.1413 413d : I7l3 1, Ito h-imil-I dollart] SL Paul . Minceal ...... 1,916,734 1 .439: 868 11721 1111 lo, 71N 31 71707 3 As of June 3 0 SprinRfceld ------(See--(b) below) . - I1 ~ 410.1138 1 ~095,181 t 5, 695 17,284 111.2M0 3 1 7' :4 3 : 3"330 IS1:0.-3 21,17 7 Class .1 establishment I T .1111 .0as 2.a :1 it-h-rib,9u Real- ; . . .". 9~3 . .. 131 .2 . 1. 211 object, at taxatio n 1969 1970 A mue11- 6aw -)me; . . AM . 808 '327: 963 6,009 4 .577 34.:Go11 5. 1137 :21 5 31 3 1 .1.4 1 1969 1 197 0 C, (1 1- 1.1)in' bl-)) .: . : : 3.1 .1R :71ag71 2 .1~ 3b2 It 1 339: 96 3g .4I9 04 067 Z M 4,599585 56 9 is 7 619 '1 5 82,29 7 80.21 9 16,11. 323 .51No1 312 : 250"5 S22" :42'g4 31 :g5711, Dallas...... (SaoWy. (1) bd . .). , 1, : 3,15 :311 1 . 111~ 06 1 .66 4 411, :'21 5 DiTtillid! ~Oirts Plants : Dim-ol ----- (Colorado) . . . . 1, 526 929 3463 20,219 12 .829 11,: 4071 1441 : 231132 1 . 11 Gill! led spirits- - ...... 72,548 6' 07 Plantsa 'in,( .at mmmr)~ 337 325 Little Rock ------(Arkansas) : 1,878:06 1 I!I7!,8J2t bs , 1, : 73 1 89 21 682 IA72 16 .7113 oil 11ted spirits rectification tax ------1,356 1 : 077 No . Orleans...... (L ...... 1) 566 1118 06 26 1 96 1 3,: IZ79 37 1~ :,1,171 1 : 1368 5 21 : 1115 1 .6319 Wr x-- . . , 5 cil'.In.d .,ti. 155 1122 " Oklahoma City ...... ~Oklxhrdo.) ...... 1 :111 :153 11 .171 11:9 3111 11 11~41411, 1' .c21 2 7 24 Is e----- 35 4 31 hall.,all. . . ing 275 Wichita ...... Karsas)- x7 .n, 81A U 841 ~662 . .I. ..'aa .",5 I 20 117 2,323 2.690 2 . :259 Chars,lame : ng in bond ...... 56 54 --wh ...... ,43 . 1. , Tax . M :"6 20 .= 20.119 2111Is1 Dan-,, il- - . ARoDra_Media ...... I talks) ., 125,452 92,128 1~645 ;43 1 :,1.2,1 13 ~ 211 25,284 56 51 27'2.554 no) I :xp.id bottling . . . I's11 143 -;, 36 ~1 54 256,186 9820 .300 371 494 to8 .942 Classoil I ------1,124 1,211 13 9 13 8 No 1 260 : 214 17: 311 5,005 382 5: 11 3 Helena '( 'M'.'.txn 377.968 4. 1 73 44 DenaturednoR D cti'yl"'- and lot free Plod-s(dr,ofids. usea, 1,.) : 11 wait) ...... 29 79 599 506 3 7111) 7,141 71 : 13 ' "1 , 394,173 5.942 G,14 5-~ specialty dDn,t .,d alcohol add dantarsired I Los"0"" Anixelo :: : (Sea (a) 1 6 4 0,119 4 .87 744 88 555 7, to 779 1.234 .27 8 . 1117 6, 651375. 81. ni..t C III, F:'- ...... "'88 42 4 1 11mimit'. ~A1,G , ;,,a))., - . .* 8732,620 620 .17 3 12.333 1 : 95 2 VH26 1 65 : 1 1 .2g213 1 12 .1 1 C 11. G--- 142 '69 Usuds of specially denatured OlCidul and donator d Pit isnd . :: : . . . ------1 . 112715 :311 11 : 51 11': I52 l 3 : 343 17,0. 237 7121 20,75 1 Cig-, s .all.-- lo. . . , . . . I . . . - I 3, 424 3, 419 Reno 20 RR 3 191 3,309 13,27247' " a 312S 121: 19, Cimettes, large---- Healadhor...... cI I . . . as, MI. . at special), do.t .,g `'' d 503 .73439 37 20,134 9,047 5,388 8,540 8617 2 576 37 59 S it Cia ~ ;ty all l.~) -x! : ------01 Ciga etl- small ---- ;,("C~:`" . . . 7.94 7,95 San Francisco...... (See (a) below) . . . . 4.245 719 3, 136 .397121 42:789 5920: 16490 M.160 :53 2 6 , 47 7 7 745 31 1 3 ~717 Use,, at t-l- Ic~dbpl . 3647 328' oad 1Statt ...... (Washington)...... 1 1, 111, 111 1,311, 21 191 . .. 21~ 31 356 ig2o 1, .1 1 ,1 ':'714ase' I . Beer : Brewu,hn --- 158 154 . .1 he . .. I swunall...... In an 2 .M IT Gas 85 U 3 Note-Anolunts of internal revenue ta,,s collected on., Puerto Rican tobacco Wine,Is . Puertothat Rna...... 217 482 1 2 5.201 136 . IN 4 4 7 "742 and Im- manulact ..x transported to the United St at or con-ded in the Tainpaidonded wine cellars. . . 0 ...... 356:957 3267 5 .052565 1,734325 239 18.464 7,658 991 359 956 island (last afiumd, . deimsalks and expenses) ,a co-ed into tire Treasury of I'll65 Puerto Rim under the pmvi,~,ionx I sacs. 7652(a)(3) and 5314(ii)(Ont the ~ndarnsl Vinegar : Vireas,wine I .Oleading.res husing.'.svii-anna---- prec,. . . . . 3 3 c!h T rolir as amounts are induced in overall cc actom B...... delta , UNIT I., State, of h..D above R,.suits. . . . u' (table,Code 1 4) intioning with 1955 . lor,pad a,I 2: 063 2:13 W 1Ds l 59 5 3 567 Z. it,:1c it "1. 2- i'n b` O-'s- . "1,J114. 2 .6 (OCaliman .a .- - . . . . 10.716,328 131 .344 135 : 242 151 939 2,097 .359 14 .664 12 :456 :189 3 131.. I Ill film is ...... 6,009.994 '1 :532 "' 13:05'2 85 727 64 368 81926 , 550 1 6,'7 037 It21!et i 1d.a'221"'i oi be.do'.. .s...... 134,60 5 131 :706 c) NeworYork 10 433,125 7 .343,684 297, 139 94, Z39 1238 09:690's 0 2 283 : 3 M : IN, 19,107 149.711247 Oth a, . ~d) Ohio 5~ 462, 286 4 .1646 .897a 821,2'4 41,1 : 1719" so 462 1, OK 122 6,512 7 7 Nanutacturers or no,-beverage products (drawback)- 1715, 71265 P .-O v,na I,:III * 411 '14 4 1 187,796 5,552 "6 : 14gon 7 59:119 f "ilt-flandr, doce"I'ate plants . . . . . 7 D ...... 639, 1', 85 : 2 174 7276,633 3 1 63,978 1 74' : '96'3 : 326, 491 5 .468 8,38) 99.051 Bottle damulactu reis - - . - - . . 121 124

Ind d,I estimated to, declarations no, variable by Diwict, I Includes 4 extionmelai distilled spirits plants nclud,, 144,273 forms ID40a NBA, Pit, and V1 which ate inciLded no "all other individual and fiduciary- returns I, this table on p. 17. 1 Includes 12 expe nolerdill b,D.D,,.s I Inclisdat 6 . .plliormntal banded vviou callus .

124 / Annual Report / Statistical Tables Annual Report / Statistical Tables / 125 .-Establishments qualified, to engage in the Table 11-faermits relating to distilled spirits under table 15-Number of occupational tax stamps issued, covering fiscal year 1970, or portion thereof, by class of tax Table 10 and by production or exportation Of tobacco products and chapter 51, Internal Revenue code 1954 internal revenue regions, districts, and State s cigarette papers and tubes sort, n Dortillied spirits 517 1 ------t As of June 39- R . Code Section 5271, I.R . Col e class of establishmen Internal -cones-emes, districts and State , Total :t1fort,:- (States represented b-ind, districts indicated in parre . number Man,-he's bell-offor ,' .1 on . 196 9 1970 relate" Retail ! --h- a moncla sers of- tn.ca ; Mail to , lureo,- ..I state, Total Distilled all. .1pothm -_e cmeofan iriffrion"ain ~ ~ elcmid_eduar .ffinif"",hon,~o . --- In I otis Less 20, 227 203 spirits in spe- "I125" 454 Net Mine Ma" 4 1849 Speri Speci rLdom, stills than proof than u~ .11 , a 1, .. i-e d S55 20,DOO g.11, L Tons- inape,t lag hired de - d,na. free al" " alcohol build hirednom arcane ] Ma . alcohol TI M1~' '$ 22'0" (1) (7) f3) 4) 5) 6 ) (1 ) (2) (3) (4) (5) (7 ) (8 ) (9) (10)

1.1, 1 . Vin - 1 1, 032 02 2 ,404 o1 364 thairind Sawill. totll~ s1l 12:1a 241,1 :~I :la 1,1 111 sa Is I 6~a 15 4 60 -74 . ...-andensu ...... IN,- 2118 as3 J2to -190 171 C r . 2 Albany (Sol (c) her. .) ----- 10,480 12 3,104 7 I elarinaned, total . . . . . 700 1 5 6 3 1 10 August.- .- (MM'nn')lps;tc) 4 3511, 861 4S7 Vsto ...... I -c '3~ 2 17 :113ILI 4111 - ---1 77 1 77 - 7=_ 8-ki...... lseec)111111 :~ 31 :10 1 41 45 OffursZ .s. b2 U Z ------. - a . (Sea (c) be] 142 .6fIrt11 25 8 75 7 I 8 heumainaud . . Top 21 5 ------3 - 1U off In ow) 567 3 6 HartfordBunImgm'____------(Ve'"'LCcnmpcb(c).11).I)__ . 13 .777 4 . n effect June 30,1970_ .1~ 1 . 1=~~4 0 28 Mae at an --- (S" c I 416 Amended ------725 21 1 22at2 Portsmouthh (V '3J,: 94011'TO "1 ."PI-dare- (Rhode-" NNW),"1 17 31 , 622 RaIi- fru st . . 11 "iieltune marYland-and G .C .~ 51 5 : ,afk ...... (New Jerfar,) ---- P11., 1197 87 12 . MI. . 4'~1 Table 12-Ildrinnits for operations relating to alcoholic beverages under the Federal Alcohol Administration Ac t Philaffillpma---- (See (a) be Ima) 11IT :,711 4 Pittsburgh (See (a) be ") 43 1: 'IIISt 2 Richmond- IV, me) ------14,9172 8 331 14 Disliffiel spirit, plant s is Wilminston (D,I!war,)-, to 3 th s. . .11 Grand Win. Win. .AlMn't'a "' 11,974 1 395 1 .7587 status total Tell z istillers ar. usin g ,,tifi,,a adP,.b dc, a,c I Indelc port- oles.fin s Bir 111,8thare (Alableare).- 8 .900 .ad bottlingIt all, Cin lure a_ . . . (South a 12,40714 527 1,072 Greensboro- . .- (North C 1544 223 (1) (2) (3) 4) 5) 6) 7) ) ) 9,291 """,Me,1 com . , 32 .211 60' 5 2'3'6' Nectiville- , . . . Turn... . . 14 .070 2 839 A affect WY 1 . 1969 ...... 12: 62 3~111 64 13 Q4 0633 80 ..nl,.f Regs-, ------.3-11 iseed ...... 1 356 T 13 5 Cincinjenfi_ 11 dl b :j .1* 111 104:783 a9. . . -_ 1 = - ~ _= Clear it I1 7' : 9'2 1' 153 erminated, total ...... 1 .437 .. 43 .... 2 7 4 7 099 Detruit ------(Mlihinger) M . 799 14 .460 22 lordilneipailes ...... (Irdhoaa)_ ...... 20 5,31l 2 2 ...... ------I ------I Lomianhe_pokinsmox (Ilntuc 11 1 10 7 24 it IT I ...... d--- 1,435 I ...... it 22 - 1 WestVrigi~')n-rat .: - 7 :52N '2' alud .- .;s. in ...... I. .'res rati 5 3 43 0 __...... ~ ~- 6- 31 ~_5 3 39 6 53 Abinde ...... W .- 3.529 allI Its n ff .IJ a130. 1970 ...... 8 mended.u...... : 37~' 35 ...... 0 2 Chmego-e,Iles Me , :~ : SoIS (b) p` "kbelow) ...... 28,852 Its 11,086of f -A23 - _ 5 ..a) ...... 10,890 3 1 3,067 FirMg, ------(NW.,rth Dakota) ------2 .341 10 1 .037 Exclumelf,ernarts ho( customs marn,1actpan .,;mR banded evvehumses since such e~l .bi..h..,enls :ttehannotorneq,ired to fleetly as fistilled spirits plantL I N -A lif...... 27,342 83 a 3,111 3 ISIfS i Calminn ( I do ., art ocill-I th (3),(4) and (5) since one permit may coy me, activity. Onallia . idbraTkar) ...... ,~1 :07,1~rf 7 SSt. Loull ...... "I1 "olC3 02 89 4 Sp,pau -,d ------(M.-ta 17.076 `7 66 6 Ta ble 13 .-Permits relating to tobacco under chapter Table 14 .-Label activity under Federal Alcoho l ingfic - .. - (So. W b.1ml) ------9,294 71 4,12030 2 3 52, Internal Revenue Code of 1954 Administration Act R a, Abortlot, unique,__"`u"_- ~ w'I Me,ice) I 23' ]':454' "IT a ISea prim (1) le.) *11 31,115 3 414 M.ru- Applications acted upon ChIverin- Wya no 101 69 D a, e fow~_ ~ V ,turer, of w Export D=dr _~ fS do) 5 00 Status Total ptobacco umm- CmD(rf) ...... 105, 11516 3 60 roduct , miRintior s Type of labe l Li Rack ...... _6- (Arkansas) ...... 4 169 07382 I'll Orl,aa...... (Louisiana)- 16His 48 5,484 Dns- (1) (2) (3 ) Tota I onmallwin I 1 .1.1 Is), 1~_ 1: 2 13 l Approvals I 1,,,mp-reas atilt . . . I ...... 1 'C ~3 1,2'1'6 a5 1"rI"cltll "lull ...... ?.a s 227 Anel,a (Ldare----- __ (Ar.s1.). _ 18"7 ...... KI I p I V 1 . 1969 8 I"Issued art ...... 41 20 .) ----- 431fifl~ to1 660 Grand total 7 1 . W 4 71,225 2 RRilm,p 1 1,439 1 _72- 44 2 B noluln' LHMpdtaM)a)_- 2 7 33 1,212 Distillind spirits, total ...... 33 .941 33.57 3 Los Angel ;s : : (So ( b v) 201 15,365 3 R. .. tied...... Phmenir --- M o2l) . . '1 : 143.. 58 2.%7 Otherwise tmer-lan! ------72 Ummosr' . 115 :~1,131 11 7.2116 41 Portland (01 1.11 2,1,1 4 Rmm toMIN' '22 4 Imported ...... 1 In effect June 30 . 1970 . . . . 392 20 i 189 ~ ~" ".'1 Amended ...... 77 44 33 Wines, total ---- X3 3 50 36,00 7 40 (See A 2 If,fill ______Seat11 r,""-a- __ Was 2f) '23:923 Diere.st.- 14,0432 13,926 40 1 limited 22,26 2Z .0~1_ lotall for State, lot linown above MAI, beverages, total ------__I, 658 _L 64 5 Do ..at ...... 95S (b)MC-Ilmor- 3j K~3114rifu,~ ' s 426 I&W 3 7 87 Imported ...... ---- 700 95691 --- 9 183 16,3167 425 3 (0)(it Nob. ~ k j, :11,1's 4~1 1 11 0 10- or 44,931 U4" 31 (a) Perrilywa-, 4C .003 85 13.056 3 4 49,863 150 3,889 124 2 2

126 Annual Report Statistical Tables Annual Report / Statistical Tables / 127 Table 15-Number of occupational tax stamps issued, covering fiscal year 1970, or portion thereof, by class of tax Table 15.-Number of occupational tax stamps issued, covering fiscal year 1970, or portion thereof, by class at tax and by internal revenue regions, districts, and States-Contine d and by internal revenue regions, districts, and States-Continued

War, Bear Alvin- .

Wholesale dealers Retail dealers lbe,ar, TemM. Internal revenue regions, disl,,cts . and Stales Dealer s (S; .tr,,!p,a.r1,d li~ single d0nit, md,cal,.' in.1 to a, des'a'sWhat-"" . de ,!. '!"a ' m Law, . . Pro. !,ge,,,al -arre, 11in- uhlblitS, 1105111',s R.t.al dealerram , he,as .totalsforol ruStatessholl1toottem, table) P-li. at-d barley Man,- be,]-, this- P,aili . L.dare. "ah"ai""to"and'a""' toor-. varisa, ~,euresnbtad by simille diwict,n %dicaledI an gren- Whh'y Win,, 500 , . Whole. doNoted dealers in tamalsS, . Pbura- at,,. last- $3 andill I th totals In, other States I own M tam of to le) W-s' And Wines, ad , 0 surel sale .1", , " I , round- $12 S3 returns . 91 an 31 beer a .1 Pa.. $1 ;24"1 $255 "a,,5 .1 arm, a dealers, $24 line 411, 's $2 $~4 $110- $123 $24 1, beer ) $ .2 0 (21) (2?) (Ill 111) 11) '21, (27) (28) (29) (30) (31 ) anPe r orth "":led I I'll, . . . . . ------1 12) (13) (14) (15) (16) (17) (18) (19) (20) 5 Albany--- . ..R.d I...... as, 169 1.41, 131 .M .7 Asou ll 11, ~ Me' am'c)" 13 12'2 1 . a9"6 - I 7 .-w-Au.. .all . aneg.. . . 's I a20 as 1.8 24 .321 Is! 8, 15 1'a1 1,111 IS3 .11 1 3 33 5 Alb,my 3 3 2 1 82 2,40 9 5 franklyI liffal, ------Se - ~ eea ,, below) ---- - .963 802 28 a ...... August ;! ISChe)'_ .'low) ...... 11 1 II ' (a) below) ------3 172 1, Ig 9 .4A 5 177 13 2 7 Bull8 ...... be. se .cha,ells)b 6 2 176' iii ?1 I 4 '...... 49 BuNiqlar-_ ...... (Vemard)C _ 927 3 ...... really, 15 183 1 41 21 8975 Hartford,-- ourectscut)_( . . . 11 852 15,83 1 9 2 uftalo . atb,o,* ; : . 1 1920 ...... 2.1 Manhattan 33' .. . . . '3 5 barbarism ...... (Vermont) ...... 431 3 9U21 - PV.'t_bith___ (he . Hanabahat) . 1 3 I . M "'1 M"' . . 1. 2 . . Hartford ----- (Connecticut) . 4 1 316 1 .896 1341 -id .r-_ (liffirud.1sland) . 1 6 7"25515. .4 4"1: G48., 7 1 ...... Manhattan. . . . (See ; :_ . : : 212 2 Il 722 3 89 4 .9'7'6 ...... i s 11 .1m . se Obr e "'hu 1 25 1 .350 (MayI' al nd D .b 2 r, 97 6 9 .137 11 511?1 ...... 3 4 P*",Mo,,ne'donce . . . : (Rhode Island) 1 7 31 ...... Newark (N-T" ) . I 'l 1,7, 21 : 12 141: P ...... I~ . 3 .1 15. U I .- Philads~phaa ...... _. : 991, 7 3 53 32 1 ...... 3 7 BalturN .wa .'a...... (Maryland and D .C .) . 1 2 41%1 1 .2,11 '1 ."X421q 1,1 Pr(sbough ...... (See (e) below 1- 11 1 31 _ j ...... (New J.Isef~) . . . . 6 3637548 Rxianmall 7 1 6 " li~ . . '1~ '24' 0"' Phil .dol,h,, .- : .-- . 1 13~ 13. 17'id 3 7* ...... 1 _ Wfladmil .a~ : : Delaware).-- ...... - 3 799 7 4 ...... VaeaI wy. - . sh .w. In". - I? 11 'Rtt= ~ . . ~ . _ : . .: I' 'i.'iay`fi' I 50 2 3,251 2 102 3,731 381 1 2 Atlanta- . .- (GrarRus)I .- 31 LIN S .W 15 4 --- ...... twerlWdhnmRt,m._ ...... ------2 9 13 Hunarniah ... . (A abrun . ) I~ 996 3 .68ING 8 41 .-I 1 41521 112 :194 1 11. Columbia . . . . (South Carhfiba~: 6112 2. 7"4 Atlanta ------tGnuo) I i 214 7 1 : 'I o'9 1 21 ...... GreensboroJack (North Carolina 1 1, 1 . ' 5 .514 411 1 1 . BirminghamCot ~Ilaymnhl) 2 1 31 11 3 .41,171 :~ : ' .61 5 2,03 7 5 . . . . . abbis --- South Carolina ) 3 0 71 2 . 24 3 1 2 IKk "a avill (F'iaai"iPP`)Marbour) : 292 Greensboro 1, 11111i Carolina) 2 38 20 2, s1'7 2 6 4 :427 ...... Nashville . 4 27 L ".5175 "1: 71sr' 29 7I laulsonJ ., kill a vrlj~_ Mmiss'Plu) ...... - ...... 2 2 ...... 79 4 963 1 7 C-0, . xleaul- .. ------U 138 7 .03 0 41 305 Us 47 1 1 ...... 1 c- "N . Florrda)- 4 47 17 1 11123 4 11175 4 : 2171 ...... Cmunhati- (See (it) b :j ...... 5 22 995 7:04 15 9 ...... 1 2 42 shvill. . . ~ ...... (Tenn saeej: :~ : Cleveland . --- IS(ydj.~h('J) 4 3 .. - I ;. is, I; - 617" 1 3. Detroit ----- (laid,.a Ran) a 4'6 21 : "3 1 131 6 5 11 1 '1 CClever..ii .nlli- (See '(it) bels.j. 113 11 54 2,4 E7 8 5 56 486.0 ...... II I ana) 6 1, .21l~1 14.: 11D 1 13 . . .ad...... (Sea (it) b -- a "12 1 13 ...... 1 . . . .1...... Detroit ...... (Midaga at..) - I9 1741 13 3: 828276 51 ' 1 D` --- -- 2 3 Parkersburg-- : . (Wes agrua)...... 1 earl11 "I342" 2,014e. 1 ...... Indistair al...... (Indiana 1 _ 4 2 2,0421 43 "206' 07 . .. . 2!? * : : :' . - _- ____ - 27 y .7. 1 2 2 1 1 1. .1 L.ui .,l ------(Kentucky) 4 123 1 . say 1 27 Ab.,d""'.e . "...... (South D.luda) . . 279 (West V,rgin;;)i : 110 1 Cha.,p (So. (b) below)- 4 ' 337 2,131 13, "'044 14 L : .is - 2 .4an101, Des Morres ...... (away-- - 112 13JR,3 1.14 14 41 3 . Ab,,d,.a ------(South Dakota) ...... ---- 1"11 "1 ."' 1721 5I I To M ...... (North Dakota) 7573 Chmall. . - __ . . . (S. (b) 1,0.wi. 1 41, 3 ' 2 31 3 Milwaukee ...... (Wisismsm). . 4 16 1 .074 6 94707 84 94 ...... 2 Dral Names . .. . (Iowa)...... 41 2 1, '1'1 41 (Nebraska 11 4 482 2: 1 3 ~Nrbth Dak.ts) . .. Lou . . ~ : : (Missing ' 2202 1,12 2 7,366 4 2 14 ...... 2 5 Mdw'uke Wi-",n).- . 6 11 112 213 33li1~ 4 .17991 1 11 1 SI : Pau I ------_' . (Mmaesual) ------1 969 '1: 1 71 1 1 Omaha ...... (N .b-Va)_ uthewSpringhill., ...... (Sea (b) bell*) --- 41 7 711 IT J314' St. Lobis. (Missouri) 3 1 3 4 S,6 13 : .I TS 11 a S P.ul 011 a hu"')...... 2 9 12 1 114. .5 Albuquerque. . Austin . _ . ~ --- See (1) below 21 ' '" X 1 5 ...... ,..Sp ingfi;ij_ :. : : :~ : - . . : : . (See (b) beto I .- . - I . . . 23 4 131 .236 - 300 3 GB G ~: 199 . ' 8 1 . relleve-__ . . - ...... 3 1. a s 7 .459 1 6 $1. I~ . . - _ 3130 $1 Ch ,e,venae ...... lWyeari-jr)(I ------511 ------...... 9 212 7,641 13 a Albuq .,,' I ...... (New Me-b) ...... Dal as ...... SeeobelDw) .- 1 1,5050 Arjad I . . I (See T bal ..) ...... 261 5,6272 (i 41003 14,3282 3 _ . . . . be a------(Colorado) ...... _ ...... 1 3 11 4':4115 13 11 ...... 1h*DID.,...... IS 1(W -nl)- . I~2 1 1 Lit to R.O . (Arkansas) ------...... 1 ...... on (f) below) 2 6 1,667 3 .1 3 .11341 6 Now Orleans...... (Linustamki .) ...... 2 Ill LIM' 4,92323 9 12 ...... (Colorado) ...... 1, 19,41 3 1144 1 :382311 Oklahoma CA ...... (0 1.1hinard, 127 865 4.263 7 3 ...... Unit, R ( Arkansas) ---- . . . 1 1 1 Wichil...... ---- (Kansas). . . 1 0 3 083 3 ...... New Orion ...... (Louisiana)- 2 1 1 2619 31 104, 3818 _ ._ 1 . as 173 61 ... 7 3 Te 3 . : : - . * : : : ** : : , . I s Oklahoma City ...... (OklahOM3) 1 H5 1 68 Ararlaule ------1 44 272 ...... _ .- . . _ . . . . - . . . ' Militia ...... (Kansas) ...... i n . . . . 77 3,26 7 ...... 2 0 bad" - __:~ --- _ --- (Idaho) . . . . 21 21 1 . 17 ...... 2 .-am, Reeled...... 21 173 22 9 .6s,I I's 14 .4n 2 Its Retail------(Must... I '50 0337 ...... I ...... Anphoraga_ (Alaska)h . .- . . 11,7 1, 1 1 ------2 Honolulu _ ...... fl1-1 0 1 :211 1 1 2 ...... ;.a, a~ ldl ',a,------480 Losmrsamb, Anu,l : - :: : .: ------5 741 2 .7'117 164 3 l 4 3 M . a)_ . . . . . 2 66 26 1 1 - - : : ( A 10 43 3 935 3 2 Haossittla . . . (H.-ly.. ~i9 363 '03 tierRe r.t11"d. FO epn)- 066 5 1 La' Angeles ...... (Sea (a) hdov). . . 4 1 1,347 6 1138 5 .559 1 it .. . Nevada) . 'I36 720 1 ...... Moral . . (A unne) . . 2 .749 1 1595 32 3 ...... 21I 1 1I.11 4 4 Portland------40; "an). . . . 265 3 098 LI 70 61 San 1,amv- FS.,?a) b 38 1 13 131 ...... 2 Red...... (Neva,10 - 2 25I 9 2 S.011------(W..h.ast 21 994 '1841. . 2 7, ...... L", City. tut .h)- .. .. . 28 1 .12412' ...... SallSao I-orsaa .. (See (a) below) ...... 79 6 151 3, a' 30 3 Seattle (Washington) ...... 213 4 2 11314 1 30 898 ...... 9 Toyota to, State, not shown above 0

Totals to, States hot shown abov e ...... I 1 . 4 .843 4.6~4 7 1 a 55 . . 3 :~ __ : . . . 1 4 Illinois, 5 44 2,956 37s 22 . 74 5,140 (it)i c")) 95 46,2132 63 61 1 25 9a 4, 4,11' 4 12 26 8.649 2 394 Ohio -- - 46 2 .394 16.97 9 4 6 22 2 i ~b)) a C"I'lIllinni"'"a. --- -. : I I ...... 7 303 451 2 (e)PeymsYiv3nra_ 4 35 3.128 21~570 69 0 1 ...... 3 7 (i)L') NewOhio York...... a 14 58 3 787 31 355 (f) 7 . . . s ------1 51 1 3,191 16 .8311 44 24 ...... ------41 1'2 2211 7, "2154 6 1 : 0" 222 10 P 1 32 1,1 313 24 21 .1" 1 it 7 , 9 53113 17,463.234 19 251

I ln,l .d,, 5 Waivers at less than 500 b el, .1 $55

128 / Annual Report / Statistical Tables I Annual Report / Statistical Tables / 129 Table 15-humber of occupational tax stamps issued, covering fiscal year 1970, or portion thereof, by class of Table 16 .-Appellate division receipts and dispositions of cases not before the Tax Court (nonclocketed cases ) tax and by internal revenue regions, districts, and States . A . Progress of work F .Y . 1970 Nat ional Trial— Act Deal ., Core- Adult.e . Marophotor . ... s onschtc, Mancts". nly to perated ated only of lo- only o,m- aming rocessor isa,,. Notate, of c. ... minct .'s Statu s internal ieveme routers, districts and States cap.,, w weapon, lassified evice elly,ted i o'Wi,ed assifie d l - Ah ~ mise , ter and 0 Deficiency Overas....mee t filed sure, represented b~ 'Ingle district,-o i -1n ha on,tle of tabl e and penalty theses: totals 101o 11Srs"'Ithin it lasT , "li""yhe, rhA ". y Otherapon, "22o ,'e" ose . Class 2~ $200 ..pon ,- eapo n " a. 6, (1) (2 ) (3) Class I Nut Cla s, 4. Class 5, $10 Received- 22,179 255.240 109,981 (32) (33 ) (34) 35) 36) 37) 38) 9) 0) 26,13 1 1,331,94 0 537 - Disposed ol, total ------...... - . 25~29 9 1,071, 982 33.948 Is 37 6 5 7 .0. 1 lors 6, agreement. spestras state . . let...... 20 7 - 83210.193 33.225 Unallieed : (0... . s,ess,ents, oWers eac,se. employment. ~nd offer cemponese ejectries). . . .,1 .908 211~is ssap,axi _ . . . s .1 3 Byy8 p Vaetpagetode,frit oCstat.tc,y error ------_ - 1 ------it Tax ourt- transferred to dockete 3'T : .111 3 2 ...... status--d 2 . 338073 82 47 9 A 2 4 1 ------.spen_ (M.s. loss) 2 Pcnd ing Joe, 30 ...... 23,01 1 Rthrocklye ...... (So. . 51-5 1 9_8 114, 57 0 allBuffalo. . (Seewto low ...... ;limrtm------4vorrei ...... 2 _ No IT ad .- . . . _ . (comenot-1- 0 : 3 B . Results obtained in disposition s Manhattan ...... (See W tha sn 2 5 Portsmouth ----- ( N - H ' .dc'1s`UPmD_ . Mid Providence- (Rh , Appellate determination iA I s 1 1. 18 (thousand dollars ) offifine",tim". R", - _(marylitij arid D xji~ 6 --- - . Number el cases (Ne ------0 M,thled (S 4"I,'I'ww c ) ~ 1 5 o 91 ...... i Deficiency 01ro .slIsintimt (Se : (a) below) l and penalt y Richmond. . . . (Virginia) Z 1 2 1 2854 (Delaware)- . siera fterpreft n . I N (1) (2) (3) th...... I .. 2 1 o I Atlantat . .R"`7-...... (Geargo)- . . . 2 ...... 1 4 37 . . .. . Birmingham Disposed of, let.] ...... 2,224 299 517,538 52,603 , 3 --- - - er,ampo fjor-Th Comlirta)...... LByh agreement .__ - _ . . . 0,780 ,3:925 52,238 i si p I : - ~ 0 speed . (0,crossessments, claims e,,ise ,employment. and after in cmeactrose elections) (Florics) Ill . . 3 2 1 ------,olef.,itt ., sta! ptery imfice . . . . 1 .249 11 108 1 2 .1 1.3 ...... B tax . . . . . 1 Nashville ...... (T,nrysse 2 2 byylospoth y ` he Tax Cour4-1ranstrredt to jorkeei states ------. . . 1,301 la I90 1150 cent,radl senior . 1m,mn"mi 2 7 41 2 T,e:`Ixf~ b 278 7 1 Revised. and __ : : : . 2 . . . 4 42 1 Do" or ...... (Michigan) 1 1 3 1~ ledisne,pa,'- ...... Ohdi-k~...... ------1 Table 17 Louisv ille ...... _ (Ke, tuc Y ). . . .- . . . . - - - 2 : .-Appellate division receipt and disposition of income, estate, and gift tax cases petitioned to the Tax Parkersburgwa ...... (West Vilgirra)...... 3 ------1 1 Court (docketed cases)- . 2 . 1 end ------. a A . Progress of work F .Y . 1970 Aberdeen...... (511th-6.1ccito . : : ~ O'sChicagorspm~___ ------. . . (See (b) below) ...... ------__ (Iowa)- 21 . . . . 1 FargoMi ...... (North Panamint stated io sts notice Tionflvatiley willoole) ...... 2 (thousand d= -- 2 36 ------i! Number .1 cases she Nebraska) ------2 Star. , S j: PaulL`v`------(Minnesota) 3 ..7 --- - Defide~fcv ilovtw I so Sprimirfield . . --- (See i below) ------2 135 1 and ina Ow.'s"osineent i s s s 1 conevea.1, shied ..- .- . .- ...... 11215 - (3) AAlbuquerque ...... (1) (2) custom, ...... (Sea (0 be see 2 . . I :~ - S 7 6 ------...... 1 141 . . I Th.Vular, ...... (Wymning), ...... Pending J..lv I _. __. . __...... _. . ,,a, : : So V) ,) law) , . : .~ : - - ---1 4 2 Received sets 9,843 1,343,8228 C o lorad o ------1 _ ------6,96 8 510 .8a l -13126 . . . . (Arkansas) ...... 5 3 2 Little Reel, . . . . 5 1 , 801 21 A Publions11 Now Orlears. . Louisiana)- Dis ncbrr`9' r'1aI.`prv n.t,.s 131l " 3I Is 311 jithOklahoma City ...... (Oklahoma) ...... ------~ Appellate Division's statutory notice$' fi x ...... (Kensa.) ...... - - --- " lot1 ------F W :4 4 as . 3 ea 1 pi B_ I f Disposed or, total ...... ~15W -,368 H1xi Me tons)Ilda.1o,------. -- - , _ ...... I : : : : . I ------5 By stipulated avreemot . 5,278'682 396,852a94 .1 ...... - fticionill1l 1, I'll To. Govrj .1 laxiniale, iNtooll ...... ------V - of tratore the 45S 3,158 ...... IN"""on,,y l) pi~jpw) . 4 W M 4 ox Court on the merits ...... 946 94 .358 ...... Los A ;j 2"es'ail 2 -- - Peremp, : : : *~ : : , (( A itoon.) ------4 1 ...... Pending )one 30-, ...... -- - - . . Portland 0; .Vn) - :- 602 . - . . . . - - ...... 10 111 1 .360,26 1 : 1_ : ...... 6 6 Reno ...... - 5 below) " 41067 _ : 1 Difference from table 16. Ss To is 3 ------transferred to dricioled status is caused by excluding district directors' statutory notice$ considered by Appellate ir, 911-day status . Seattle ...... w.slinglar) ...... ------460 . . . . 1 :121 ------B . Results obtained in disposition s lotus tor States hot shown -leal- Appollal: Womisat, o (thop and dello's) Calftln's 7 10 4 Number of c) Illinois- 173 Method i case s DOanicepcyof in tax Overassessamp t Ohio 5 ~r)it P,nnW;a toa - 11 3' Iff Is— ...... In 2 (1) (2) .. fly (3)

Disposed .1, total ----- 6,6882 217 :993 3,890 . . . . 5,2 7 3, 890 By by the 7x- Cecil or del . .It . . . 458 1 2,623" " ' Tried a ore the Is, U .It no the ne .,ill I ------946 94,358

I Represents amounts peLtomed.

130 Annual Report / Statistical Tables Annual Report / Statistical Tables / 131 Table IS-Office of Chief Counsel-Processing of income, estate, and gift tax cases in the Tax Court - Table 20-Office of Chief Counsel-Receipt and dis. Table 22-Office of Chief Counsel-Receipt and dis posal of suits filed by taxpayers in Federal courts and posal of collection, injunction, summons, and actions by the United States for recovery of erroneous disclosure cases Amount in dispute (thousand dollars) refunds

Statu s Number of as., Number of case s overpaymen t Refund SiRts (0m, statu s than alcohol, tobacco, and fi-- t .smyt Trip - Pending July I ...... 1,696 . Status H i,C d b7spatted at . . . . (1) P .(3)41 , (4) .1 1 Pending Jan. 30 101~cla.t 11 I co0 01. 1, 73 ~ 11 :04, 1,2 '12, ,109, 063 Pending July I . , 1B" : 70 ":31 ' V'I "'.8 (3) (4) ",Nov , . This table include, cases hardly 1."gd le~,U,, -loct, Filed ...... * *. . . - . :~ 1~:~ ._. . _.A . : ...... 6 169 34 it . ad 6.%4 364,744 34 35,553 actu, consideration lot soft a, aR, I," suit'1rRt"" Federal coul I does Disposeda' '.aat ...... -. . . . JOB 091 87.84 3 hot include tes laltithat to 11c .h1l, tCb.ccar and f-Rhas t-, R.' to ....11mu, Pending Joan 30 ~ ...... 11 .453 1 .280,165 24 Pending July I ' Inand I de blot proceedings (table 23), a, tf,hop.~l ad other cly,"Inch -induded Cases . - e nonam 3,414 394 2,984 3 6 able Amount in disput , Revised. thousand dollats 427 .471 187 .837 237.184 45 0 RIC-ed during Yea, Table 23-Office of Chief Counsel-Receipt and dis- Chief Counstall-Receipt and disposal of Tax Court cases in courts of appeals and in Supreme Case, - humbe , 1,189 140 1,021 2 8 posal of insolvency and debtor proceedings Table 19 .-Office of A .-IRt dispute Court thousand dWl- 155 424 35 .582 119,628 214 DisposedC._,during. yea,RCRTR. R in Supreme Co urt 1 .182 107 1,053 2 2 Total 1e,,,,m-I .. . ad MRtZ11* 1 . C ourts .1 PC.iC Amount a dispute ceadbnrn ~03-, c,, =sh nsW,, thousand dollars 86 .335 35 110 49,246 1.979 st,R ., pr-a', TId . Refunded during Yen, Amount a dispute Amount approved Amount it , dispute Amount pPRURI'dU Ings (thousand dollars) (thmithend dollars) (thousand it C t Amount - thousand dl),s 34 094 11 .249 2z 4 5 ruarbe, (thousand dollars) Percent at mr-I disposed at 39.49 32.04 46.3 9 (1) (2) Status Number Pending turn 30 : (3) (4 ) at cai's Cases ...... be, 3 .421 , 427 - 2 952 42 Ditfi-n. afrount a' cases Defickhr- Over. Deficien- ..Tva... ,. a , Amount in d.spint, C,R.C ad.U, pahan,D'"' U"c""'C, ad 0- C, ad ty ad thousand dollar, 496,560 1 183,309 307, 568 1 633 Pending July 1 . 2,064 1,031 572 Penalty Penalty payment penalt y Received 3. 156 1 . 5M LIMIT) 45 6 1 p U.,latod .f _ 2,891 1 .29 3 I .Q 8 M2 (1) (2) (9) I The number of cases disposed of does got agree with the number of cases in Pending June 31) . . . 2.329 1 1,29, 58D, 45 5 (1) U)) which decision, war, ordered by in T rdtf,~ni,u!htrcy., ,, .d,,, to CIII. . . . I by st" WIt "on, dismi h, and time rel.i,,.d In a , .1 ta, k ~ . at am Bar- P-edn'91 instituted7 under to Pending July 1 . total -302 , 21.726 2 2 1 . the Court at Claims the number .1 deritunn, tan, 35. at which ainct ; In CR.R~~at,1 Ill,y Act Gatherhatnal, 16 against the G-Rhount . ad 4 paRtly to, and part"1 5 *11all , 1, hu. s ; Sec . 7 Wil-al Themgfollow"'R.riyations)St"ta:10d"Ina y! ChatX p.. a. . .Rto I a"arglarethun ), 11 (m,nagnamnlyas 1. an-unind itudebtudnesty. fill (real propertyd App. % lod byb y C.Inaryinguner . 1 170 5 Government . lathe districtouits 332 dedshor, were readered,ol which 151 were, and XI -age ttal .-' a which l-W, . claurs a, AVpaa:d . - ~'424 16,005 a . : : . * p for the (votarnment, 1?3 against the Gove-ent, and 58 parl~ far and Rally t) ~y h U as), it . . . other tight,n ~hdI late CI, Ron,I a It,,VSutoC "I . A by laxpboth 'yet. 26 4,551 9 aninst the Government . for it ecceRmy by the couitt at appeals in Supreme Coult, it,fainkou'lCy p se, T able 21 . fiquiC .U . and 1"d-I .1 state "calim"Ful, 2 1 2 meanings which involve 11. claimsV i0, Un ad tates . Appealed, total .- 319 31,427 243 , Revised . Proce.Callags ral,brig to corporate dissolution, insolvent bants, assignment, for I If a benefit of ctedit-, or administration of By Commys,larim- __69 ---i-3 97 2 -5 aslatts at decedents, which ,2,3 1 ~B l, '1,17 2 . 2 involve tax claims at the United States. byy UXT'sy ...... TableB. 21-OfficeofP Chief Council- Decisions of courts H both ...... 79 of ppeals and Su reme Court in civil tax cases Note ind-, Ca, handled a( istannal and agintul level,. 2 12 ...... 1 2 onoo.und of. wt., .986 ~2 4 0 11 48 2 12 Table 24-Office of Chief Counsel-Receipt and dis- 154 6,772 12 6,772 6 1 2 F, table to G-Rogisamer- ...... forthe Agrun,t ,a,"'I"and posal of miscellaneous court cases, lien cases not in Favorable 0 tascRive ...... Total Go,cu- the G- court, noncourt collection litigation cases, and appeal Modilled . - B21 4 . 717817 1 . 2i5 Real moorma i al,fll11 .1~11 ...... settled . . : : : : : * * : . : : :1 . :, , _ - 1 1 .261 1 IT 915 Court the Gov. cases Dismissed --- : ...... 38 2,402 202 1,079 mrannut 37, 167 4 1 Pending June 30 . late ...... 382 I (I (2 ) (3) (4) ,M,,c,l- Lien Martsm . I na'aus AllA pp:.::d o byb; 7 8 14 514 5 status Total cap't no,...~ "Tc . . . . ' 280 19.592 2 7 use, I coud 3 Cal. . . 6 Appealed by both ...... 24 3,061 9 343 250 57 P BycC .,U, .f .pmRtlC.t .taI 33 1 24 t 5 4 (3) (4) (5 ) R,' Md . .,a occa-med by maeldInU, Channel at late porthren, diumi-I .1 pablains m-coolly filed act in ith-I to - Ital-WRY Orrin-fly led a- O'll-re . bobae,at tables 17 and 13 11L .),., 1Court- . 1 200 154 19 27 Pending , by 76 688 notice and a shillat difference I, Jurisdiction bMwe,n Aft and the Ohice a Chief Counsel .11 cmuce. . . . . j 13 1 87 35 9 Necow,,J 5.0. . 1 .766 3 .34 3 nI, D S . 3&0 438 1 . 7be 3, 9102 162 By S . ' C.C Churl . lot,[----- 12 3 P=Rne 30 . . . - 1. 514 379 84 29 22 Originally tried in- T. . C.. .I 11 2. it"Rhyl .ta's . . . . . 3 1 .6 day athIs to, Inced.-a or RaRtgag- a, In,, stic-al C,.dRCRt . and court at claims. _ U to met fine to which to . United Stay is y PURa6l, appl-fiam, I ., dfi.haR,R jh, mnl, t, a . lia.l. Primarily ane-haduartya a pama tigatnt. after, from lega-I c.. . W 96I The Courts at Appeal, tendered 124 opinions RI 200 docket ,,,bar, at which 1. district directors whic ate not elal,it to court proceeding, a, lien cases . m .r.n, ! far he G-orce.al,1 .2top, ion, or, ontially Jay the Govern .at . I adud,s cases fit federal and State ppellat, cour s reining. 1 . in-l"aRy .ad 16 OR, ., --as witte not Cat and debtorCa .. p-eedings, lien case, ,I court, ad collect!I so an . . on, a, courts of -gairC, the R RtRis 131 cases . of which 65 OR .. . 11, to, the Government,appeals 7'and"" upla a,102 op"aa,, ati .,ifly far the Ch-ampitt, ad 30 "onNote. -includes cases handled at national and regional leveh . . * . .. .. opinam, -th, against the Cover RTin mil I he Supreme Court a up ahms 2 docket o,Rb,,s T , Supreme C. . . I .ad"121. d 4 a Commas well far the Gav-m,m, and I armul, way" n .Rsy ;he' ""3 a' watch

132 / Annual Report / Statistical Tables Annual Report / Statistical Tables / 133 Table 26 .-Costs incurred by the Internal Revenue Service Table 25 .-Office of Chief Counsel-Caseload repor t he th.. .. ods of d.11.14 Pending Reconts Dispinals Pending July I June 30 .Personne l Activity T .131 nerionsation Inver ~qwiera.nt Ole" (2) (3) (4) Inle-I ., .au. Me, . dsuda, or Jet— and hon'Oft,

(1) (2) (3) (4) (5 ) I .N1 ---- . . . . . 23,268 29, 123 27~ 516 2t, 87 5

Adeanullolice ...... 78r ~l 49 167 6 3 A National Office and einual brals rincludeg district directors' Office$ and service centers ) Alcohol, Tobacco and Fi-ruis 949 7, 850 7,709 - 1 . 0 Total Intiunal Re,...us Service I ------...... ------fron. 159 778,527 21 .439 61527 79,667 N ational Offic------...... ------...... 107, W 58.125 E552 2,291 245 2,390 2,330 30 5 45,594 Hafl-I Offir . . N ifirth-Atlanbc ------...... ------. . . 134 .463 127,24 6 2.283 438 4,497 Fald ----- 704 5.460 5 379 78 5 Med-Atlaribi: ...... 103 . 26G 102 .028 2,269 4U9 3.561 southeart- - ...... 87,135 thl'off 2,777 505 3.852 General Lifigatine. . 4. 913 10,803 10 . 138 5, 57 8 is 9G .978 90,540 2.455 435 3, 549 id-t------...... 97 .01 2 2. 9 1 0 72 4 4.025 307 Put . 67 2 N,il nsI office 385 332 360 Southwest ------...... 1 . $2 .474 75,776 2.354 454 3,889 Field ------4 .606 10 .418 9 .806 5 .21 8 wB ,Its...... ------...... li),3W 107 .64 3,489 950 5,399 egional counsel------.- ...... 11 .918 11 .476 162 ...... 330 E.I .couran, 2,073 1. ION) 96 2.206 Ra guest inspection------...... ---- - ...... H . 195 10,01 1 91 5 31 Z34 0Micelinea,l 'eteini'vina'" ------U raffee , ------...... 5 852 5,427 204 Is 203 rialki G11- 56 54 37 73 Cowers, Caere ...... 51928 2,808 13 221 2,886 Field ----- 2 .017 1 .046 930 133 RS Data Centel- . .-----. . .. ------...... --...... 11-429 10 657 57 58 1 .658 Interpretative Di'sion 174 505 421 258 B ReRional counnemioners' offices 4-lud,ng district dunctem' Or and s.m,cu centers) Logedation & Regulation ---- - NMor th AUa it ------...... 14 .412 13.437 280 46 G M o0h,asl ~25.3117 92 Refund Litigation 011111- 4 IT 1 16 1, 182 3,42 1 1 '7 : 04 03.. 13640 j3st M 14' . 2 1 1 321 757 Ina Court Litigation-- YSO 7~ 2;F 6.805 11 .83 5 !it a 1740 13 IN 416 111 894 Sworth-t 8:660 7,901 303 44 408 National Off .'s I BIS311 11,311 969 R, 241 315 2 e,tl,n . . . . 12,4DO 11 .0% ___457 2 Field ...... '64 11,45 3 C Regional Its tiodst,ita.led INifi-th, -Atlantic- ...... I'B53 751 664 11 127 Statutory Notees nor i1clu ed, M d-Atl.nb------. . .. ------1 .213 W 610 ...... 23 Revised, SCourthrost . 1 .035 Q8 494 124 e.trsl- ...... ------1,286 57 0 531 1 5 171 Maidwestu ...... - - - 1 .365 624 S99 19 123 s Of eat ...... 858 395 428 23 ill w estern------1 .22 3 41 1 - - - - 21 D. Ocir ct directors' offices and service center s orth-2lantir : A 3' 41S 1 I3 :076"a J :s4 T17 2 44 itan ------...... 14,988 14J6 ~0111 246 421 3 4S Weekly...... 3 4 '2 8 Li ------18 "470 9~ 122 26 12'~ Bullies ton ---- ...... ------1:00 1 .4 4 10 ManhH a rtfold ...... * ...... 7,572 7,257 114 15 7~1~ Parlaallan. .. ------31,776 30 .979 202 41 5 3 1 1 41 Providence" 1': 5 '8'6 21 : '44 8 38 10 7 32 Puerto Rico Blanch (Af&F)- - . ------*...... 145 133 9 V) 6 Ztre:~1 A~:1 Ig I 1,,i .n,l Ilaune, Centel------...... 264 ...... 258 n~i' firgion-Cowt,alued Training ...... RR1 . . - . . - - . . . . . rth-A' antic So-c. Centel ~ ...... 25.4659 23,869 32 14G i'ii m id-Ati"a .ebc MarkB.Ibanal . ------...... 12,879 11.4 13 32 4 423 2150 32 61 V: '47'0 '716 :88 2 25487 15J . 3 Pittsburgh- ...... ------1 2.124 1 :11 2 1 7 1 Richmond ...... ---- - ...... - ...... 2: 10 1 Rg11 344 20 5 Wderler,lon .. ------2,258 40 ...... 1 5 6 IlMidi I ntia,1. R:g,.n-C, .I ah .d I a , 41 At an tic S mice Centel ...... 23,825 22,646 28 Ise 1 .56 3 , .in ri,it; Atlanta ...... I ...... I ...... 8,313 7.771832 413, 20 Birmingham- .- ...... 5,169 43:324 "1Is, 14If1f unithia...... - .- . .. -- ...... ------3,578 116 29 C-1Greenstic------...... - ...... &234 7,703 3 18 5 3,357 3,106 J42" '24' J .,raui 14~ 41?9 1 31191. 371 BOG Nish'ille ...... 2s1 G9 I Southeast h1g .-Cent,11lied I --re.it ------.' - ...... 55 Soothes V Service Centel ------19.395 18,139 4340 143 1,0A7 Memphis Service Centel ...... ------...... 30 ......

bounnet ------...... - ...... 9,202 8.754 3 Cleveland- .-- ...... ------...... 14 .382 1~1:5714~ "1'1 37 31 . Detroit---- . --- ...... 17 : 5 392 India S 72"'7 9 .131 So21 31.4. Louisvn le ...... 6,071 5,696 "18,1 20 Parkersburg...... 3,346 148 1 12 ...... 153 143 8 Co. e,;.e G9 . . . . . 61 ContraiServicaGenter...... 20,754 19,569 32 108 1,046 id.ait A .erd, .e-- . .------...... 1 .637 chinc------22,645 21 :6134 " 257 46 us, Male's...... : , : - : - : : - .428 5,055 7, F. go ------...... Sol 1 .375 . .17. 14 1 '3 Mileauke, . ~ . -- ...... '1 :81 7 7, 391 256 6 Gnaah . . . . 1 ...... --- 1 3 27 1 1.: 141 0 . .1.2. s ...... : 31 "6 372 "2 13 5 2,22 31 S ;: 'Po .1 ------...... 7 .754 7 364 199 161 Splue,firid- - ...... 6 1 a 09 . . 5:624 21 0 20 15 5 -C , forced ...... eg'- ...... 71 . .'s FViCIC,nte ------. . . . . 22~697 20

134 / Annual Report / Statistical Tables Annual Report / Statistical Tables / 135 Table 26-Costs incurred by the Internal Revenue Service-Continued Table 28.-Quantity and cost statistics for printing fill th.u,aIds .1 d .11a,s l

Fiscal year 1969 Personnel F-I Year 1970 Tota l ..dp .O.ti.n T-a l Eq milmuml Other 2 Internal re,ce., Me,. diltlill. .1 region b-It s fity (th.. . . Id,) QuintitY (thousand,) Ci.. of work Cost (1) (2) (3) (4) (5 ) (th-mil Items a P..kaaa, d.11 Items .1 Package, sets W, D. Cm I it, duect-' tho, and lI,Yica ottva-CM-e d South west (1) (2) (3) (4) Albuq:.. .qua...... 77 269 103 2 Austin ...... 12 1 . 6813 46 51i 1. Tax packar( C eye ...... ------...... 1,31-4 IT - 1111 a 1 1,9474 Package Fors (Mai. liblO and instlultlons-20 pages) 4 169 318 4 82 4'1 ! P.ck.g. 2 (For 100 .079 313 111' 0, tn'a '. i : : : . 6 215 19 : . 1040, srhajfi.la~ B . D, 1040&S . and x 75,607 309 L ttle Rork- ...... ---- P:ck:~' :,in34 1 1,4140: xx1Chad' a. as1 1. D, 104015, and nx1-tYn.ns-4'nPg,:, x~, , If,a : .. 71 .: 136,19 3. 567 Ml 12~ 3 19 30 j5481 ...... New Ode,ris ...... 6,792 14 7 2 4 dF;,1,11b ,CC1t1 , and i n stoxti--4 Oklahoma City ...... 19: P cklg. 5(fonin 1065 . sched,l, 0, x-16 Pages) ---- 6 07516 1 5.673 164 25 21i - 4 2 2 75 Wi, ta. - . .- ...... 4,989 4 650 17759 22 P:Ika,A 6 (Farm 1120, schad.la D, For . 346S . andin' , Ol"intom-24 pga,). 141 Pack age 7 ( F 121': 7 15 1: 1 4 .lhw,si Haguu-C .hl,el .ad llaun,ug 5 9 orm 1040A, instfurfions _ ...... 39 440 19,720 176 So . h- So-ca Centel. . . 18 108 ------mm 42 162 It Tax ta6 gas (1969) 1 1 Waste n - 551 P ., age A (Far . 1040 c Package B ( Form 1040 : xRed. 1,, A : B : : L : R : T! -C-, p: ~L------...... 966 :94350 64 .463 AnchningW ...... 1 .028 . andt Form 4136) 2,154 !,a ...... H1 j Partnership 11, Package (for-IM, s .h .dI. A0,and , an s) ...... 2 4 , 594 17 ,8 19 1, , d capital ",time. xi,~ . al ------1 .91 1 1 .594 96 16 Corwration lax Package (Ca andar Yell lilet-Form 1120 an gaun s 23'~ 583I3 : 902 Conh, .dfi:l,,)T' _- .-k ...... 2.6 _ ...... * I 3 F arm 11 4~400 Los A .Feles, . . . - . ._ : : : . . : A ~'M9 Z7 412 4 g 116 1 .051 ,2 (I 70 . schedule U . i,stfW,: 880 33 Phoenix ...... 11, firml~care F,-0 It-.ts 1120~ Peekal.-go 3468, 4466, Y 4626. . . trials.-D4) ...... 2 392 . .. - 15,000 1,000 P Dead ...... '5 :822 14 : 621 13 1 4'7 2 11ol1;31(1,1.1,la,1 :63 Ron...... - ...... 3 241, Pub 3 ar WV-2 941A, W-4. schedule A (W-4) , Pub . 213 , --And- - - unemployment ti, chsc~fisl)-- - ' I$:Ill F1 1,.k 2 12271 ED! ..65. . .7.1 72~000 4 .500 19 1 79.360 n6sca : : : - : : : - : - 1 7 18 2 336 IV otherTax 11111n,I. . raitV, Ind OsIrvItuits W .-ap -majlj~ij 't;* ijpj ;m.::jojjl~ ---- 54 136, E65 4 .960 209 1741~, 148 81 . 427 1 8724 .352-353 g3,754 -3 .07 3 Stattl ...... 7 200 6 : 7 3 2 23(] ns use ,ubliformsc . and pam,hl, , I W :sl:;n Regional Training Centel.------V. Administrative 1 mnbhstrUdCb'~ .~ Slh% t...... 1 I 10. 3 M 384I24 _ _ 252 74 - 1 .01 :61al" 7 3:4419 121..:"971 - W , n Regi-Cm,44u,n) Training . . . . - VL Field p,i.[,ng - ,1 1 30 . , 12'2 __ ...... 5306 : Western Sa,Vi,A Centel ...... 25,82321 23 .943 67 ~10.,' . . 1 1 M7. 4 CO S Vll E-rb'"a" "am"s 2 07 0756 2 , 645, 543 Grand total ------14.271 ...... ------M88 D :Le3stha " $500. Includes $7.0 million financed from reimbursements. In 1970 there we, a major Change in tax form, and ta, package format . 2 Does not include transfer to General Services Administraluin in the amount W $1,427 .000 lot rental of space . and ;495,000 lot Lally Records R filament . 'aIn'to, PreviousOil as,,. Ile conlent, at the or [,a's'On Package for calendar year and fiscal Year a -_ !do a tmn,t farm, but fiscal year Kill Mail were identical . P-iqu o It R Act of 1969 made it notes Table 27-0bligations incurred by Internal Revenue Service, by appropriation and activity [in thoulandsof dollars)

Total Pinsamnal compen.tion Othe r and benefit , Appropriation by arti,11,

1969 1970 1969

Tot,labhg,tY,nr-- .--- .- ...... 758, 785 836,159 667~ 191 778 527 91 . 594 107,63 1 Appropriated I und, total ...... 755,305 879,125 W, 228 772, 531 Wantland . pan... : Total ...... 21 .931 25 .569 18,973 22,214 2,958 3,3'-', Unuthe direction. . 9,666 11 . 133 8,349 9 .808 1,317 1 . 325 la1a,ral . .d.tacd sexullty ...... 12, 265 14, 10.624 12,406 1,641 "1 2, 30 Rownue amounting and procei Total ...... 189,183 214,199 3219RIf9 ~ji.7 i76i 30,551 36,442 hin ...... 67.015 --199 . 9113 --l37,~2 7 895 9,76 96 2,72 1 . . . " 72 L1,1-1 - 2 ' 1 65: 836080 76: 657 15,252 3, 5 21 2, 8'2 :Ompliance : Total------...... 544 . 191 639,257 486,623 572, AGO 57 .568 66,797 Audit .1 tax 294,949 1~~321: l 9 257,656 296,856 1427,293 3 1 , 231 ClUenclilnTax I'lud *11111"and ".1 ",1~,q. tI,C..'tiff.ll, 1and, --if d6hq-t returns- . . . 123,970 109,106 134 .292 964 17,256 38,536 4 548 4: 540 6,042 AlcohoLlobamandifteurns .." ...... 41,656 50: 20 ".3 334 : 412 :11"24 6,707 7,66 9 Talgayin conferences and IPPe315 ...... 21 ~111 11~: l2 1~1, 13 . 901~14 212.2 :2,1,1 1 . 111.7~ 1 : 7IN3 1, T fidings and sery,ces . . . 10 , Legal,an-'snice 1 ...... 18 .452 21,069 16,9 7 19 .224 1,525 1,84 5 Reimbursements total ...... - 3,480 1, l 7

-A .. .rus shown do Out include ~anll, ;IS, ISI,forrent of so,,, ,ou7,,tsng to $899,000 in 1969 ; $1,427,000 un 1970 : 7 -,W t. Narcotics at $63,000 in 1969 TransferNote in GSA I ., Early Records R.tj,,me .' , of $ 0, 000 ; $495,U 0 in 19 C.

136 / Annual Report / Statistical Tables Annual Report / Statistical Tables / 137 Index

A Estate and gift taxes, 111 Disability insurance taxes : Estimated tax, 110 Acts: Collection, 110 Federal Alcohol Administration, 38, 4 1 Excise tax6s, I I I Refunds . 1 6 Individuarincome taxes, Federal Tort Claims, 63 110 Disallowed . claims, 24 Interest equalization, 28 Foreign Investors Tax . 1966, 57 Disciplinary actions. 86 Gun Control Act, 1968, 10 ' 38 48 49 Old.age and disability insurance, 119 Discriminant function, 2 7 Other, 11 6 Military Personnel and Civfli~p -Em . Railroad retirement, ploy-'s Claims, 63 110 Tobacco taxes, 113 E National Fir"r-s, 4 7 Unemployment insurance, 110 Tax Reform Act . 1969, 5 . 8, 9 Employment benefit plan, . datelnuna. 87 . 88, 89 Withholding taxes, 110 tion letters on, I I Advisory committees, C ..,,issi .ne,: Alcohol and tobacco tax : ~mrrloYment taxes : Contest of suits, 62, 63 . 64, 65, 103, Advertising, 4 1 Collections, 15 Chemical analysis and research, 42 04,105,106 Returns filed. 1 7 Commissioners1 of Internal Revenue, 98 Court decisions, 103, 104, 105, 106 Entorcement activities : Enforcement activity, 22, 23, 24, 25 , CCompetent.~P,omj~:uffuoi-ity activity. 55, 56 Additional tax from, 36 offers In, 31 26 . 27, 28, 29, 30, 31, 32 33 Alcohol and tobacco tax, 38, 39 34, 35, 36, 37, 38, 39, 40~ 41', Confercnce~ Appeals, 28 . 29, 30 Appellate, 28, 29 4 2 Claims disallowed . 24 Establishments : Prcrced ... ~, 28 Delinquent accounts, Cooperation . rederartax, 73, Inspection of, 38 74 Delinquent returns, 3 301 39,40 Conventions, tax (See tax conventions), Examination program, 22, 23, 24, 25. Qualified 58 Industry cir-l' .rii, 40 26, 2 7 Label circulars, 4 2 Coordination and cooperation with be . Mathematical verification . 18, 19 reaus and agencies, 74 Offers in compromise, 42 Offers in compromise, 3 1 Corporation income taxes : Operation Dry~Up, 38 Tax fraud investigations, 33, 34, 35 Prosecution, 3 9 Additional assessments, 28 Workfl . . in Service and the courts . 37 Claims for refunds. 24 Pub] ications, 40 Es Regulations, 40 Collections, 11 0 .AdditionalCot tax : assessments, 22 Refunds ' 16 Seizures and arrests, 39 lections, 15, 111 Supervision on-premises, 40 Returns: RefundsRct .1, 1 6 Statistics on, 39, 40, 125, 126 Examined, 22, 23 . rns: 17 . 124 Examined, 22 Appeals : Court(Filed, Appellate division, 28 Filed . 1 7 OfCircuit* courts of appeals, 63, Chart on, 29 64, 104, Estimated tax, declarations of : Processing of. 30 10 5 Corporation,. 1 5 claims, 63 Statistics on, 29, 30 Individual 15 Append 0 Supreme, of the United States, 63. 64 . Examination program : Assessments,"' 10 additional (See Taxes), 22 103, 10 4 Claims for refund, 2 4 Assist:nce : The lax Court of the United States, Selection of returns for audit. 27 For ign tax, 58, 59, 60 62, 63 Overasse ss.tutts of tax . 23 Ori 59 U .S . District, 62 Returns exam I ned, number of. 22 Overseas, 59 Criminal prosecution : Tax recommended, additional, 22 Audit exempt organizations, 24 . 2 5 Analysis cases, 35, 36 Excise taxes : C-es,ch sposalsof of. 35, 36 Additional assessments, 22 Results of, 36 Collections . 1 5 B Supreme Court decisions in . 103 . 104 Refunds of, 16 Current research program . Bulletin . Internal Revenue, 9 68, 69, 70, Returns filed, 17 Business master file, 14 7 1 . 72 Exempt organizations : Determination letters on, 26, 2 7 Master file, 2 6

CCharts: DData Processing activities . 14. 15, 16, Ch Organization, 9 2 1 7, 1~, 1 9 ief Counsel, Office of, 62 Delinquent accounts : Facilities management : Analysis of cases flowing through, 62, Disposals, 30 Forms and form letters, 83 Other . 30 . 31 63 Motor vehicle fleet, 84 Cases involving criminal prosecution, Statistics on, 30,3 1 Printing . statistics on, 137 Delinquent returns and delinquency in . 34 .35,3 6 Security, 83 vestigations, 3 1 Statistics on : Disposals of cases by, 64 Additional tax from. 33 Tax forms . 83 Civil litigation, 62 . 63, 64 Analysis of, 32 Telecommunications, 83 Claims (See specific item) Statistics on, 32 Federal rea rms regulations, 8 i Collection litigation legal services (See Determination letters : Federal-Statei cooperation : General Litigation Legal Services) Employee benefit plans, 11 Agreements, 73 Collections: Exempt organizations, 26 Audit coverage . 73, 74 Alcohol taxes, 111, 112 Pension trust plans, 1 0 Computer-information exchange, 73 Corporation income I axes, 110 Self-employed persons benefit plans . Federal tax deposit system, 14 Disabi lity and old-age insurance, 110 1 1 Financial management : Employment taxes, 110 Statistics on, I I Statistics on, 135, 136. 13 7

Annual Report / Index / 139 I

Firearms program: Statistics on . 35 Programs: Returns filed-Continued T Returns filed, 17 Crime control, 47, 48 . 49 Tax fraud. 3 2 Assessment Center, 78 Number examined, 22 Tax briefs, 8 Seizures. 39 For::gn investors, 57.58 Interpretative activities, 65 Delinquency check computer . 32 Projection, 70 Statistics on, 3 9 For gn tax assistance program, 58, 59, Tax conventions, 58 Equal employment opportunity . 61 Statistics on, 17. 124 Tax models, 72 Tort claims, 63 60 Foreign tax assistance . 5 8 Verification, I S Taxes. Additiona l Training : Foreign tax officials, assistance to, 59 . 60 Identify U .S. taxpayers, 53 Foreign, Revenue rulings and procedures: From delinquent returns secured, 30 Other . 81,58, 59 Forms: JointJ Committee on Internal Revenue Overseas taxpayer compliance. 53 82 Cost of Printing, 137 taxation, 6 5 Analysis of. 8, 9 From enforcement, 36 Racketeer, 3 3 From examination, 2 Distributed free . 101 Strike forces, 4 5 Published, 8 . 9 2 From mathematical verification. IS Forms and form letters, 83 Tax return forms. 7, 102 U L Taxpayer assistance program, 5, 6 Fraud investigations. tax, 34, 35 . 36 Taxpayer assistance. 5 S Taxpayer compliance measurement pro- Unemployment insurance taxes; Laboratories: Taxpayer compliance measurement . Testing,,39,42 6 Self-employed persons benefit plans, de. gra., 6 9 G Taxpayer publications (See publications), ColRefundslections' of, 15'16 110 Legal activ tie , 62 Taxpayer9 publications, I Do terminations letters on, I I . 123 Gasoline taxes: Legislative activities, 64 Teachi ng taxes, Seminar, Inter-American, 60 100 . 101 . 1 02, 103 Returns filed, 17, 12 4 100 Tax reform, 65 Collections . 1 14 Legislation : Prosecution. .2 . 63 S mice to taxpayers, 5 Refunds. 6 Firearms, 47 (1969) Statisticsa ' of income releases, Tax rulings : 1 Pretested cases, statistics n~ 24 71 Request for, 10 V General Litigation Legal Services, 64 Pending, 6 5 Public information program Supervision . 4 of the Alcohol and tobacco Statistics on' GIit taxes: Public laws, 6 5 Error prevention . 4 Verification, mathematical, results of, 1 8 Industries, 38 Teaching taxes )program,ID 100 Additional assessments, 22 Litigation . appeals and civil, results of . Films, radio. and television, 5 Supreme Court Decisions: Claims for refunds 62 Tobacco taxies . 24 Gun Control Act, 5 Civil cases, 103 Arrests, 39 M Collections, 1 5 Long-range planning (See Planning-Pro . New Legislation, 4 Other court actions, 104, 105, 106 Refunds of, 16 gramming-Budgeting System), 7 0 Other, 4, 5 Collections, 15, 113 Wines . taxes collected. 112 Returns filed, 1 7 Public reading rooms, 94 Systems development, 69 Refunds of, 16, 12 3 Withholding ta,es . by employer, 15 Data Center equipment, 69 Results of Criminal action, 39 M Publications . taxpayers : Workflow in service and the Courts. 3 7 F rmers t x guide, 10 0 M : .gn tic tape, 74 F:deral T :x information for Civil Se- Ho-s. 80, 84, 86 Mapagement activities . 78 ice retirees, 10 2 of internal revenue regions and dis . Miscellaneous publications and docu- tncts, 93 merift, 100, 101, 102, 103 Master files Questions and Answers on Retiremen t Income tax (es) : Exempt organization,' 24 Plans for the Self-Employed, 102 Addition al, from enforcement, 36 Mathematical verification: Questions Asked by the U .S. Taxpayers All returns, 15 Additional tax from. 18 Abroad, 102 Corporation, 1 5 Statistics on, 1 8 Tax Advice on Civil Service Disability Processing protested ases. 213 Models, tax, 7 2 Retirement Payments,I 102 in dictment., 35,of 1 10 Tax Information on M .t.a Fund Dis. Individual income taxes: 0 "I bution 102 AddfitlonalD~,ssessrnents, 36 Tax Guide for' Small Business. 100 Appellate vision, processing of. 29 Obligations incurred, Internal Revenue Tax Guide for U.S . Citizens Abroad. Claims for refunds . 23 Service, 78 0 2 Collections, 15 Occupational I xes : Tax Guide1 for U .S . Citizens Employed Mathematical verification of, 18 Collections, 127 in U .S. Possessions, 102 Refunds of. 16, 123 Returns filed, 1 7 Understanding Taxes, 100 Returns : Offers in compromise, 3 1 Your Federal Income Tax. 100 Classification and examination of, Officers, principal, Internal Revenue Sam . 22 4 R Filed . 16, 124 Old-ageice, insurance 9 taxes :ndividual master file, 3 2 : 15, 110 Railroad retirement taxes: 1 nforming and assisting taxpayers. 4 Collections, Collections, 15, 110 rispection activities : Refunds of, 16, 123 Refunds of, 16, 123 DoOperationrat g Dry-up 9 : .ternal audit, 94 ! 3 Returns filed, 17, 12 4 I nternal Security, 85 - in Financial Plan, 70, 71 Reading Rooms, public, 94 rivestigation, 85 Organization-principal officers, 92 Receipts (see Collections) . 15 Statistics on, 86 Organized Crime Drive, 44 Recruitment, 7 8 intelligence Div, sion: Overassessments . 2 3 Refunds : Statistics on, 34. 3 5 Claims for, 23, 24 Tax fraud investigation. 34, 35 Excessive prepayments. 16 P Inter-American Center of Tax Administra . Statistics on, 16 tors, 60 . Pension trust plans, 10 Undeliverable, 16 :nnternational tax training, 58 Personnel : Regulations : forest allowed on refunds, 16 Equal employment program, 81 Alcohol and tobacco taxes, 10 Interest equalization tax, 28 Handicapped, use of, 8 0 Other . 8. 9, 1 0 International operations : Intergroup relations seminars, 78 . 79 Selected regulations published, 8 Activities of, 52 Investigations, 8 6 Releases . news, 5 Foreign posts of, 53 Promotions, 78, 79 Requests : U .S. Investment abroad, 55 Recruitment . 78 Technical Advice, 1 0 Withheld taxes, 57 Statistics on, 79 Revenue rulings, analysis of, 8. 9 Investigations : Planning-Programming-Budgeting System , R:se rch program, 70 Delinquency. 30 70 R turnsa' filed: Disciplinary actions. 86 Planning activities, 68 Classification and selection of. 16, 27 Personnel, 8 6 Principal officers of Internal Revenue Examination of, 16, 27 Prosecutions recommended, 3 5 Service, 94 Increase in, 16

Annual Report / Index / 140 Annual Report / Index / 141