US Federal Income Tax Turns 100 Years Old
The U.S. federal income tax turned 100 on October 3, 2013…100 years after President Woodrow Wilson signed it into law. Back then, the base tax rate was 1% maxing out at 6%. Deductions were allowed for interest on personal loans and state and local taxes in addition to standard deductions of $3,000 for singles ($4,000 if married). The instructions on preparing the three-page tax return were all on one page. The instructions grew to 14 pages in the next fifty years, and 2012’s weigh in at 214 pages. In a few months, we’ll know how many pages it takes to begin to explain 2013.
This early romantic version of the federal income tax ended fairly quickly. By the time WWI was over, incomes over $1 million were taxed at 77%.
Now that sounds more familiar.
