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

From 1868 until 1913, about ninety percent of the federal government’s income was gotten from tax on alcohol and tobacco. While the Civil War was occurring there was a short income tax, but it wasn’t until 1913 when the sixteenth Amendment was passed and enabled Congress to tax incomes “from whatever sources attained.” The initial 1040’s were due on March 1, 1914. No money was taken from paychecks and no money was sent in with the return. Every taxpayer’s computations were calculated by IRS field agents and a bill sent to the taxpayer on June 1st.

1766 - Colonial leaders got together to protest British taxes in place by the Stamp Act. This Stamp Act Congress, which it was named, was the start 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 - America granted a newly formed Congress the ability to tax. Without taxing powers, the initial Congress of the United States scantly survived 7 years before being dubbed a failure; the 2nd Congress, granted taxing powers, is still functioning after almost 300 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 persuades Congress to pass an excise tax on whiskey to raise revenue and steady the increase in alcohol consumption. On 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 created 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 after the Revolutionary War and the War of 1812 is finally accounted for and paid. The South sees no reason to continue high import taxes that increase the price on goods for Southern consumers and increase the number of industrial monopolies in the North.

1850 - John C. Calhoun of South Carolina warns Congress that the South might secede from the Union due to the fact that heavy taxing in the South increased funds that ended up in the North, causing a massive shift 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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