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Commissioner of Internal Revenue 1940

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Commissioner of Internal Revenue 1940 ANNUAL REPORT OF THE COMMISSIONER OF INTERNAL REVENUE FOR THE FISCAL YEAR ENDED JUNE 30 1940 UNITED STATES GOVERNMENT PRINTING OFFICE WASHINGTON : 1940 For sale by the Superintendent ofiDocuments. Washington D C Price 15 cents (paper cover) CONTENTS Page Introduction 1 Collections 1 Cost of administration 4 Personnel 4 Important legislative and other changes affecting the Bureau 6 Accounts and Collections Unit: Assessments of employment taxes 10, Taxes under Federal Insurance Contributions Act 19 Offers in compromise 11 Coordination with Social Security Board 11 Tax under the Federal Unemployment Tax Act 11 Offers in compromise 14 Carriers taxes (Chapter 9, Subchapter B, I. R. C.) 14 Coordination with Railroad Retirement Board 15 Income Tax Unit: General functions 15 Income and excess profits taxes 15 TREASURY DEPARTMENT Collections 15 Returns filed 16 Document No. 3110 Examination of income tax returns upon receipt 17 Investigations and adjustments of income tax returns by field Internal Revenue offices 17 Inventory of returns on hand in field offices as of June 30, 1940_ _ 17 Unagreed adjustments pending 18 Revenue results of audit and investigative efforts of Unit 18 Stage at which additional tax was assessed 19 Petitions to the Board of Tax Appeals of income tax cases 20 Refunds, abatements, and credits 20 Depreciation 21 Miscellaneous Tax Unit: Estate Tax Division: Returns 22 Claims 22 Court decisions 28 Tobacco Division 23 Sales Tax Division: Admission taxes 25 Documentary stamp taxes 26 Playing cards 26 Oleomargarine; adulterated, process, or renovated butter 26 Mixed flour 26 Firearms 26 Narcotics and marihuana 26 Bituminous coal 27 Silver tax 27 Hydraulic mining 27 Assessments 27 Field reports and returns 27 Claims 28 Credit cases 28 Offers in compromise 29 Miscellaneous tax special squads 29 Capital Stock Tax Division 29 Processing Tax Division 29 Sugar tax 30 Claims 30+ III IV CONTENTS CONTENTS V Alcohol Tax Unit: Page Procedure Division - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Table Page 32 13. Cigars weighing more than 3 pounds per thousand: Number of fac- Statistics 32 Ethyl and denatured alcohol tories operated, quantity of tobacco used, number of cigars manu- 33 factured, on hand at commencement and close of year, removed for Distilled spirits 33 Rectified spirits export and tax-paid, calendar year 1939, by collection districts and 33 by States - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 112 Fermented malt liquors 33 Wines 14. Cigars weighing more than 3 pounds per thousand: Number removed 33 tax-paid, by classes, calendar year 1939, by collection districts and Enforcement Division 34 Field Inspection Division by States - - 114 34 15. Cigars weighing more than 3 pounds per thousand: Manufactured Laboratory Division 36 Audit Division and removed tax-paid for domestic consumption from customs 37 bonded manufacturing warehouses, class 6, by classes, calendar Assessments 37 Offers in compromise year 1939 - - 116 37 16. Cigars weighing not more than 3 pounds per thousand: Quantity of Alcohol Tax Division of the Office of the Chief Counsel - - - - - - - - - 37 Technical Staff tobacco used, number of cigars manufactured, on hand at com- 38 Field operations under decentralization mencement and close of year, removed for export and tax-paid, 43 calendar year 1939, by collection districts and by States - - 117 Coordination of Staff field activities 45 Office of the Chief Counsel: 17. Cigarettes weighing not more than 3 pounds per thousand: Number Appeals Division of factories operated, quantity of tobacco used, number of ciga- 47 rettes manufactured, on hand at commencement and close of year, Civil Division 48 Compromise Section removed for export and tax-paid, calendar year 1939, by collection 48 districts and by States - - 118 Interpretative Division 48 Penal Division 18. Cigarettes weighing more than 3 pounds per thousand: Quantity of 49 tobacco used, number of cigarettes manufactured, on hand at com- Review Division 49 Legislation and Regulations Division mencement and close of year, removed for export and tax-paid, 49 calendar year 1939, by collection districts and by States - - 120 Intelligence Unit 50 Conclusion 19. Leaf tobacco used in manufacturing cigars, cigarettes, and tobacco 50 and snuff, calendar years 1930 to 1939 - - 121 STATISTICAL TABLES 20. Production of manufactured tobacco, snuff, cigars, and cigarettes, calendar years 1930 to 1939 - - 121 RECEIPTS FROM INTERNAL-REVENUE TAXES 21. Summary of operations of manufacturers of tobacco and cigars, calen- Table dar year 1939 - - 122 1. 22. Exportation in bond of manufactured tobacco, snuff, cigars, and ciga- Receipts from specified sources of internal revenue, fiscal year ended rettes, etc., year ended June 30, 1940, by collection districts - - 125 June 30, 1940, by collection districts, States, and Territories - - - - 52 2. 23. Withdrawal of manufactured tobacco, snuff, cigars, and cigarettes Comparative internal-revenue collections, fiscal years 1939 and 1940, from factory in bond, for shipment or delivery as sea stores, fiscal by collection districts, States, and Territories_ _ 88 3. year ended June 30, 1940 - - - - - - - - - - - - - - - - - - - - - - - - - - - - 126 Summary of internal-revenue collections, year ended June 30, 1940, 24. by States and Territories Withdrawal of manufactured tobacco, snuff, cigars, and cigarettes 92 from bonded internal revenue tobacco sea stores warehouses, for 4. Summary of monthly internal-revenue tax receipts for the fiscal year ended June 30, 1940, by sources shipment or delivery as sea stores, fiscal year ended June 30, 1940_ _ 127 94 25. Drawback of internal-revenue taxes allowed on tobacco, snuff, cigars, 5. Summary of internal-revenue collections, years ended June 30, 1939 and 1940, by sources and cigarettes exported, year ended June 30, 1940, by ports, and 100 comparative totals for years ended June 30, 1935 to 1939 - - 127 6. Total internal-revenue collections, years ended June 30, 1863 to 1940_ 102 7. 26. Domestic and imported cigarette papers and tubes withdrawn and Internal-revenue tax on manufactured products from Philippine internal-revenue receipts from taxes during fiscal years ended June Islands, fiscal years 1939 and 1940, by objects of taxation 102 8. 30, 1931 to 1940, inclusive - - 127 Internal-revenue tax on manufactured products from Puerto Rico, 27. Tobacco products withdrawn for consumption, computed from collec- fiscal years 1939 and 1940, by objects of taxation 102 tions from the sales of stamps, fiscal year 1940 - - 128 28. Dealers in leaf tobacco in business, leaf tobacco exported and received INCOME-TAX AUDIT from farmers, calendar year 1939, by collection districts and by 9 • Additional income tax assessments on the Commissioner's and States - - 129 29. Leaf tobacco imported by cigar manufacturers, tobacco manufac- collectors' lists made during the fiscal year 1940, by tax years - - 103 10 • Tax items appealed to the United States Board of Tax Appeals during turers, and dealers in leaf tobacco, calendar year 1939, by collection the fiscal year 1940 - - districts and by States - - 131 107 30. Quasi tobacco manufacturers classified: Number of factories operated TOBACCO, CIGARS, CIGARETTES, ETC. and tobacco material handled, calendar year 1939 - - - - - - - - - - - 133 31. Tobacco material held or owned by dealers in leaf tobacco, cigar and 11 Manufactured tobacco: Number of factories operated, leaf tobacco tobacco manufacturers on January 1, 1940, by collection districts and other materials used, calendar year 1939, by collection districts and by States - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 134 and by States - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 108 12. Manufactured tobacco: Quantity manufactured, on hand at com- OCCUPATIONS SUBJECT TO SPECIAL TAXES mencement and close of year, removed for export and tax-paid, 32. Number of each class of special-tax payers purchasing special-tax calendar year 1939, by collection districts and by States 110 stamps covering the fiscal year 1940, or portion thereof, under the - - various annual rates, by collection districts and States 136 VI CONTENTS CONTENTS VII OLEOMARGARINE, RENOVATED BUTTER, MIXED FLOUR, ETC. Table Page Table 64. Distilled spirits: Losses in internal-revenue bonded warehouses from Page leakage and evaporation, by kinds of spirits and by States, and 33. Production and withdrawals of colored oleomargarine, year ended other losses, by kinds of spirits, fiscal year 1940 - - - - - - - - - - - - 158 June 30, 1940, by collection districts - - 142 Distilled spirits: Grains and molasses used in production, by States, 34. 65. Production and withdrawals of uncolored oleomargarine, year endect . fiscal year 1940 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 158 June 30, 1940, by collection districts - - 142 66. Distilled spirits: Materials used in the production of brandy, by kinds 35. Production and withdrawals of oleomargarine (colored and uncolored), and by States, fiscal year 1940 - - - - - - - - - - - - - - - - - - - - - - - - 159 year ended June 30, 1940, by months - - - - - - - - - - - - - - - - - - - 143 67. Rectified spirits and wines: Production, by kinds and by months, 36. Summary of production and withdrawals of oleomargarine (colored fiscal year 1940 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 159 and uncolored), years ended June 30, 1931 to 1940 - - 144 68. Rectified
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