Earned Income Tax Credit | A Brief Timeline of Taxation Practices of the USA, Section 1

A Brief Timeline of Taxation Practices of the USA, Section 1

Raleigh NC Tax Preparation

W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…

Between 1868 to 1913, about 90% of the national government’s revenue was derived from taxes on alcohol and tobacco. While the Civil War was going on the government instituted a short income tax, but it wasn’t until 1913 that the 16th Amendment permitted Congress to tax incomes “from whatever sources derived.” The first 1040’s were due on March 1, 1914. No money was taken from paychecks and none was sent in with the return. Each taxpayer’s computations were checked by IRS field agents and a bill mailed to the taxpayer on the first of June.

1766 – Leaders of the colonies met to protest British taxes under the Stamp Act. This Stamp Act Congress, as it was named, marked the beginning of the American independence movement and the birth of the United States.

1782 – The first Congress under the Articles of Confederation formed. This Congress had no taxing powers.

1789 – Americans gave a new Congress taxing powers. Without taxing powers, the first Congress of the United States barely lasted seven years before being dubbed a failed attempt; the 2nd Congress, granted taxation powers, is still functioning after more than two hundred years. If you are feeling the pressure with today’s taxes, call a CPA for Tax Preparation in Raleigh, NC for all your tax-related needs!

1792 – Alexander Hamilton coerces Congress into passing an excise tax on whiskey to increase earned income for the government and steady the increase in drinking. In the western frontier whiskey was the basic mode of exchange, and the twenty-five percent tax was a bit difficult to deal with. By 1794 the region was in open rebellion. The father of the IRS was spawned to give the tax enforcement. Go here if you want help from a modern-day CPA firm in Raleigh, NC.

1832 – The national debt remaining from the Revolutionary War and the War of 1812 is paid off. The South does not see any reason for continued high import taxes that raise prices for Southern consumers and promote industrial monopolies in the North.

1850 – John C. Calhoun of South Carolina warns Congress that the South could leave the Union due to the fact that the overly oppressive taxation of the South increased funds that ended up in the North, causing a massive change in wealth from the South to the North.

Stay tuned for Parts 2 and 3 of the Timeline of US Tax Policy!

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