14 Facts you probably didn’t know about taxes
Tax Day – April 15th – will soon be here, and millions of Americans are scrambling to file their taxes…(or apply for an extension!) As we’re confident that most of our Carrington College students & graduates have filed by now, we thought we would bring some levity to the subject. Here are a few fascinating facts about taxes that you might not know!
- The roots of Internal Revenue Service (IRS) go back to 1862 and the Civil War, when President Lincoln and Congress created the position of commissioner of Internal Revenue and enacted an income tax to pay war expenses.
- The income tax was repealed 10 years later. Congress revived the income tax in 1894, but the Supreme Court ruled it unconstitutional the following year.
- In February 1913 the Sixteenth Amendment to the Constitution was ratified, granting Congress the power to collect taxes on personal income. The new system collected income tax at the source, as it is done today, where taxes are initially withheld before the income reaches the recipient.
- The 1040 form was introduced in 1914 with just one or two pages; in 2012 the 1040 form totaled more than 170 pages!
- Did you ever notice that when you put the words “The” and “IRS” together, it spells “THEIRS?”
- Americans spend 7.6 billion hours each year doing their taxes…imagine what could be achieved if we used that time more effectively?
- Did you know that six states have no individual income taxes: Alaska, Florida, Nevada, South Dakota, Texas, and Washington
- The federal tax code was 400 pages long in 1913; it has swollen to about 70,000.
- The earliest known tax was implemented in Mesopotamia (an area now covered by Iran, Iraq & Syria) over 4,500 years ago. People paid taxes throughout the year in the form of livestock, the preferred currency of the time.
- In 1696, England implemented a window tax, taxing houses based on the number of windows they had. The more windows you had, the higher the tax, so many people decided to have many of them bricked up. Eventually this became a health problem and ultimately led to the repeal of the tax in 1851. It is speculated that this is where the phrase ‘daylight robbery’ originated!
- In 1705, Russian Emperor Peter the Great placed a tax on beards, hoping to force men to adopt a clean-shaven look common in Western Europe.
- England has a tax on televisions. If you have a TV in your home, you must pay an annual fee, formally called a television license, for each television you own. Color televisions are taxed at a higher rate than black and white televisions. Interestingly enough, if a blind person owns a TV, they still have to pay the tax, but only half of it!
- A “Jock Tax” is levied on athletes who earn an income competing in a particular city or state. California first levied this tax on athletes from Chicago in 1991 after the Chicago Bulls beat the LA Lakers in the ’91 NBA finals. Sore losers?
- Benjamin Franklin has the most famous quote related to taxes – “In this world nothing can be said to be certain except death and taxes.”