1949 - Internal Revenue Service

16 REPORT OF COMMISSIONER OF INTERNAL REVENUE
Sections 601 and 602 of the Revenue Act of 1943 provide that contributions
may be paid at any time and upon such payment may be
allowable as credit against the Federal tax. Other provisions incorporated
in the Revenue Act of 1943 permit certain credits to be
allowed notwithstanding that claims for refund or credit were rejected
prior to the enactment of such Act, and where offers in compromise
had been accepted prior to such enactment.
For the purpose of enabling the Bureau to determine whether the
credit claimed by a taxpayer for contributions to a State fund is
correct, each State furnishes the Bureau with a statement for each
employer, showing the amount of contributions paid by the employer
on or before the date the Federal return is required to be filed and the
amounts and dates of payments made thereafter. During the year
there were received from the States 1,105,256 such statements for the
years 1936 to 1948, inclusive.'"
In addition to the credit against the Federal tax for contributions
actually paid into State funds, the taxpayer may be entitled to an
additional credit under section 1601(b) of the Act. This additional
credit is allowable to an employer if, by reason of having stabilized
the employment of his employees in a State or for some other reason,
he is granted an "experience rate" under the laws of the State and is
thereby permitted to pay contributions at a lower rate than that paid
generally by other employers. Certain conditions with respect to a
State law are imposed by the Act that must be met before an employer
is entitled to the additional credit. For the calendar year 1948, all
of the 48 States, the District of Columbia, and the Territories of
Alaska and Hawaii had enacted a law to comply with the conditions
imposed by the Act.
Field investigations conducted by the States in connection with the
administration of State unemployment compensation laws resulted in
numerous correction statements being submitted to the Bureau,
showing changes in the amounts standing to the employers' credit
in the State funds This causes a considerable number of cases to
be reopened for audit by the Bureau.
Number of Federal unemployment tax returns (annual) received and closed by the
Bureau during the fiscal year 1949 and the number pending at the beginning and
close of the year, by tax years
Tax year
On hand
July 1, 1948
Received
during
year
Reopened
during
year
Total
Disposed
of during
year
On hand
June 30,
1949
1936 through 1944 705 2, 038 3, 510 6, 253 6, 952 301
1945 565 3,894 7,128 11,687 11, 144 443
1946 44,257 5, 947 22, 559 72, 763 69,296 3,467
1947 461,094 26,444 10,729 498.267 469,881 28,386
1948 None 487,635 297 487,932 2,822 485,110
Total 606,621 525,958 44,223 I, 076, 802 569,095 517,707
The following table sets forth information relative to claims adjusted
and certificates of overassessment or of allowance issued under
REPORT OF COMMISSIONER OF INTERNAL REVENUE
17
the Federal Unemployment Tax Act and/or Title IX of the Social
Security Act:
Claims under the Federal Unemployment Tax Act and/or Title IX of the Social
Security Act received and disposed of during the fiscal year 1949
Pending at beginning of year
Filed during the year (new claims)
Received from other sources
Total to be disposed of
Allowed in full or in part
Rejected
Canceled
Total disposed of
Pending at end of year
Certificates of overassessment and certificates of allowance
issued when no claims were filed
Overassesaments settled by:
Abatement
Credit
Refund
Number
4,838
14,696
24
19,558
13,704
1,662
247
15,613
3, 945
1, 317
Amount
$2, 332, 144. 71
50, 216. 54
2, 624, 431. 11
Total
Interest
5, 006, 792. 36
143, 590. 27
Grand total
5, 150, 382. 63
Nom-Included in the allowed claims shown in the above tabulation were 1,696 collectors' claims for
abatement, of which 69 were multiple-item claims involving 375 items. There were also allowed 3,861 collecjected
tors' claims recommending refunds of 4208,785 plus interest of $7,996. The amount involved during the year totaled $704,940.
in claims re-
Offers in compromise.-On July 1, 1948, there were on hand 181
offers in compromise aggregating $56,950, which had been submitted
in settlement of an aggregate liability of $402,185 incurred under
Title IX of the Social Security Act and/or the Federal Unemployment
Tax Act. There were 188 offers received, in the total amount of
$36,430, involving an aggregate liability of $239,148; 143 offers in the
amount of $35,311 were accepted in settlement of liability of $228,365;
46 offers amounting to $4,769 and involving liability of $48,366 were
rejected; 8 offers amounting to $1,282 and involving liability of $5,751
were withdrawn; and 4 offers, totaling $8,547, payable on the installment
basis, covering liability of $14,297, were terminated by default,
leaving on hand at the close of the year 168 offers totaling $43,471
and involving liability of $344,554.
Railroad Retirement Tax Act.-Collections of employers' tax and
employees' tax under the Railroad Retirement Tax Act aggregated
$562,620,309, as compared with $560,061,477 for the previous year,
an increase of $2,558,832. Each tax was imposed at the rate of 5%
percent of the taxable compensation paid during 1948, and at the
rate of 6 percent of the taxable compensation paid during 1949.
Collections of employee representatives' tax, which was imposed at
the rate of 11% percent of the taxable compensation paid during 1948,
and at the rate of 12 percent of the taxable compensation paid during
1949, amounted to $113,277, as compared with $51,657 for the preprevious
year, an increase of $61,620. Returns are required on a