Saturday, May 7, 2011

A Repeat Offender

Most of you reading this blog are familiar with promissory notes taxed at two cents per hundred dollars or fraction thereof, such as the following note.

Signed on February 15, 1901, the note stated that the American Water Company would pay the Chicago Consolidated Bottling Company $150 on August 15, 1902, and was franked with a four-cent battleship to pay the tax. Nothing unusual there.

The check below is a bit different. Written on October 22, 1900, instead of paying to the order of James Romney at sight or demand, E. Sullivan made it payable on November 1 of that year. This took the instrument from being taxable as a check to one being taxable as a note, or at least one taxable as other than at sight or demand, which has the same tax rate as a note. The correct tax on $964.68 should have been twenty cents, not the two cents paid by the imprint. There is no sign that additional stamps were attached anywhere to pay the remaining eighteen cents.

When I first saw this check, I assumed that the writer either didn't realize that they had changed tax status by turning the check into a note or they didn't know there were additional taxes involved. And somehow it got past the bank.

A bit later I found this December 3rd instrument. Same writer, same payee, but this time the note was for $844.96, payable December 13th.

The writer may still not have known that additional taxes were payable (in this case sixteen cents more), but what was the Park Bank of Albany thinking??

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