Beginnings

• During the Civil War, the first actual income tax was collected, and it charged 3 percent for people who had incomes of $800 or more. This tax was later repealed in 1872.
  
  

More History

• Income taxes didn't make an appearance again until 1913 when Congress added the 16th Constitutional amendment and introduced tax form 1040, which taxpayers are still using today.
  
  

Not Just Legal

• Illegal income becomes taxable in 1916 when Congress changes the wording of the 16th amendment to omit the word "lawful."
  
  

Social Security

• Unemployment compensation was nonexistent until 1935, when the federal government began collecting social security taxes.
  
  

Spreading the Word

• To encourage people to voluntarily comply with income tax collection, songwriter Irving Berlin wrote a song called, "I Paid My Income Tax Today" in 1942.
  
  

Full Disclosure

• Since the 1970's, most presidents have released the contents of their tax returns to the public in the interest of being financially transparent. It also works to discourage financial corruption in the presidency.
  
  

Shrinking Tax Brackets

• Until 1981--when the Economic Recovery Tax Act was passed--the highest tax bracket was at 94 percent. This act brought the top tax bracket down to a much more manageable 50 percent.