Matt Collins
04-17-2010, 07:56 PM
The Income Tax: Then and Now
As the dreaded April 15 approaches, it's worth remembering that the income tax, which is now mind-boggingly complex and afflicts vast numbers of Americans, originally was extremely simple and was intended to tax only the very wealthiest citizens.
There were only four pages in the original 1913 1040 form: a one-page 1040 form, two pages of worksheets, and one page of instructions.
Today, just the instructions for the 1040 runs... 175 pages.
You can see the original 4-page form here (http://r20.rs6.net/tn.jsp?et=1103298695805&s=57420&e=0016mJsqr4R9qSYf2l-lFTYj0DVo0kBpvazDRXMitOz73sBTtCJyk4jZcoXz8CIxsKhOz UPe0--idUEuqZYHt3xAtpF9alDUsESgYuyzs5M7jh8UfhtInxk2ptVJ6 d227I7jLv4xu-ItzkDw9CJy7TS8Q==), courtesy of the Tax Foundation.
And what about tax rates? Economist Mark J. Perry of the free-market blog Carpe Diem tells us (http://r20.rs6.net/tn.jsp?et=1103298695805&s=57420&e=0016mJsqr4R9qSls6bZWG3so_3vXCpH7QgUcBn_59lRphOag 6vVw1ie8AQZBKaaqxfyHbyiACkpXSv-AUklXriJUqYsts1A9tUsmCL9kclDODh564D-vP_NMOkSWFnLZvegG2Ft3gjm63EdZynq1f0m-9gJZb4nNJUnkhX3I_kU6l2L7R_gT4KUudy8oAcmNv4-):
"Individual income tax rates started at 1% in 1913, and the maximum marginal income tax rate was only 6% on incomes above $500,000 ($11 million in today's dollars). The personal exemption was $3,000 for individuals ($66,000 in today's dollars) and $4,000 for married couples ($87,500 in today's dollars)..."
This means, of course, that almost no one in America was expected to have to pay the federal income tax -- since the average income in 1913 was only about $750.
How things have changed. Tax revolt, anyone?
As the dreaded April 15 approaches, it's worth remembering that the income tax, which is now mind-boggingly complex and afflicts vast numbers of Americans, originally was extremely simple and was intended to tax only the very wealthiest citizens.
There were only four pages in the original 1913 1040 form: a one-page 1040 form, two pages of worksheets, and one page of instructions.
Today, just the instructions for the 1040 runs... 175 pages.
You can see the original 4-page form here (http://r20.rs6.net/tn.jsp?et=1103298695805&s=57420&e=0016mJsqr4R9qSYf2l-lFTYj0DVo0kBpvazDRXMitOz73sBTtCJyk4jZcoXz8CIxsKhOz UPe0--idUEuqZYHt3xAtpF9alDUsESgYuyzs5M7jh8UfhtInxk2ptVJ6 d227I7jLv4xu-ItzkDw9CJy7TS8Q==), courtesy of the Tax Foundation.
And what about tax rates? Economist Mark J. Perry of the free-market blog Carpe Diem tells us (http://r20.rs6.net/tn.jsp?et=1103298695805&s=57420&e=0016mJsqr4R9qSls6bZWG3so_3vXCpH7QgUcBn_59lRphOag 6vVw1ie8AQZBKaaqxfyHbyiACkpXSv-AUklXriJUqYsts1A9tUsmCL9kclDODh564D-vP_NMOkSWFnLZvegG2Ft3gjm63EdZynq1f0m-9gJZb4nNJUnkhX3I_kU6l2L7R_gT4KUudy8oAcmNv4-):
"Individual income tax rates started at 1% in 1913, and the maximum marginal income tax rate was only 6% on incomes above $500,000 ($11 million in today's dollars). The personal exemption was $3,000 for individuals ($66,000 in today's dollars) and $4,000 for married couples ($87,500 in today's dollars)..."
This means, of course, that almost no one in America was expected to have to pay the federal income tax -- since the average income in 1913 was only about $750.
How things have changed. Tax revolt, anyone?