Home > Tax History > Happy Birthday, Federal Income Tax

Happy Birthday, Federal Income Tax

For the U.S. history buffs: As of what date is the current federal income tax effective? 

The answer:  March 1, 1913

Federal income tax made its first appearance in the Revenue Act of 1861 as part of raising funds for the Civil War, but was short lived.  Later, federal income tax was imposed by the Wilson-Gorman Tariff Act of 1894, taxing incomes over $4,000 at 2%.  Shortly thereafter, the U.S. Supreme Court declared this tax unconstitutional in Pollock v. Farmers’ Loan & Trust Co. in 1895.

Jump to February 3, 1913.  On that date, the Sixteenth Amendment to the U.S. Constitution was ratified:

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

The Sixteenth Amendment nullified the Pollock decision.  Effective date of the Sixteenth Amendment:  March 1, 1913.  March 1 was also the original due date for individual tax returns.  Here’s the original Form 1040 from 1913:

1913 Form 1040(via taxgirl)

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Categories: Tax History
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