What Is the USA Federal Income Tax?
The federal government of the United States imposes an income tax on its citizens. The income tax represents a significant portion of the revenues for the federal government.
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History
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The current income tax resulted from the passage of the sixteenth Amendment ot the United States Constitution in 1913. Prior attempts at instituting a national income tax had been deemed unconstitutional because they were not proportional to each state's population.
Size
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As of fiscal year 2008, the federal individual income tax accounted for 45 percent of federal income, which equals about $1.125 trillion.
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Features
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The federal income tax applies to all income, earned and unearned, including wages, salaries, dividends and interest. The taxes are due by April 15 of the following year.
Fun Fact
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The original income tax law only imposed the federal income tax on lawfully earned income. However, Congress removed the word "lawful" in 1916, which allowed many criminals to be convicted on income tax evasion charges even if they were not convicted for other crimes.
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