History of the Income Tax

Many Americans dread the day that April 15th comes around each year. They know that more then likely their bank account will take a financial hit (if they haven’t already paid before the deadline). The history of the income tax dates back to as early as the Civil War. It is illegal to not pay your income tax, and if you don’t, the government just may reach their hands into your bank account and do the job themselves.

In 1861, the Revenue Act passed during the Civil War. This act implemented a tax on personal incomes to help pay war expenses. The people paid these taxes for ten years until the Revenue Act was repealed. In 1894, Congress enacted a flat rate on taxes. This was declared unconstitutional one year later by the U.S. Supreme Court because “it was a direct tax not apportioned according to the population of each State”.

The 1950’s brought reorganization. They replaced the patronage system with career employees. The Restructuring and Reform Act of 1998 was brought upon by the IRS. This act reorganized and modernized the IRS and founded the Taxpayer Advocate Service as an independent power inside the agency on behalf of the taxpayer.

The filing deadline has not always been April 15th. In 1913, Congress specified that the filing date would be March 1st, after the passage of the 16th Amendment. The date was pushed to March 15th by Congress in 1918. The deadline was pushed back yet another time to April 15th in 1954 due to the tax overhaul.

This is how the Federal Income Tax started. Its purpose was to pay for the soldiers and supplies during the Civil War, and we have being paying them ever since then. A few changes have been made since then, but the purpose has stayed the same; to provide the government with revenue it needs. The income tax may change slightly in the future, but one thing is for sure, it will never go away.