Interesting Facts About Income Taxes You Probably Didn’t Know

Here’s some background information about the annual income tax filing deadline in the United States. April 17, 2018, is the deadline to file 2017 income tax returns. The deadline is later this year due to April 15 falling on a weekend and the celebration of Emancipation Day, a legal holiday in Washington, DC, on April 16.

The IRS’s fiscal year runs from October 1 to September 30. Here are some interesting facts about fiscal year 2017

1. How Many Individual Income Tax Returns Get Filed?

Total Receipts: 150,690,787

2. How Many People Get Refunds?

Number: 119,853,012

3. How Much Are They Getting?

Amount: $382,865,300

Taxes

4. Where Do The Taxes Go?

National Defense: 16 percent
Social Security: 24 percent
Medicare, Medicaid, CHIP, marketplace subsidies, etc.:  26 percent
Safety Net Programs: 9 percent
Interest on Debt: 6 percent
Benefits for Veterans & Federal Retirees: 8 percent
Education: 2 percent
Transportation infrastructure: 2 percent
Science and medical research: 2 percent
Non-security international: 1 percent
All other: 3 percent

5. How Did Taxes Get Started?

1862 – During the Civil War, the IRS is born when President Abraham Lincoln and Congress create the Commissioner of Internal Revenue and enact an income tax to pay war expenses. The first income tax levies 3 percent on incomes between $600 and $10,000 and 5 percent on anything over $10,000. This income tax lasts until 1872.

1895 – The Supreme Court rules in Pollock v. Farmers’ Loan and Trust Co. that taxing incomes uniformly throughout the United States is unconstitutional.

1913 – The 16th Amendment is ratified by the states, giving Congress the authority to enact an income tax. Congress also introduces the first 1040 form and levies a 1 percent tax on personal incomes over $3,000 with 6 percent surtax on incomes of more than $500,000.

1918 – During World War I, to help finance the war, the highest rate of taxation on income is 77 percent. After the war, by 1929, the rate drops to 24 percent.

1954 – The tax filing deadline is moved from March 15 to April 15, to give taxpayers more time to prepare their returns.

January 3, 1996 – Congress enacts the Taxpayer Bill of Rights to ensure relief from overzealous collection efforts on the part of IRS personnel.

Written by CNN Library.

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