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Welcome to this insightful journey through the history of income tax in the USA
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While it may seem like a permanent fixture, income tax wasn't always a part of American life
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It was only in 1861 during the civil war that the first income tax was introduced as a temporary measure to fund the war efforts
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after the civil war, income tax was abolished only to be reintroduced in 1894
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However, the Supreme Court declared it unconstitutional the following year. It wasn't until 1913
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With the ratification of the 16th amendment, that income tax became a permanent fixture
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The initial rates were modest with only the wealthiest Americans being subject to taxation
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The need for revenue during world war I I led to significant tax reforms
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The top marginal tax rate skyrocketed to 94%. Ensuring that the burden of financing the war was shared by all post war
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The rates gradually decreased. But the concept of progressive taxation where higher earners pay a larger percentage of their income remained today
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The US income tax system is a labyrinth of regulations and deductions
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It's not just about the federal tax but also state and local taxes
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deductions, credits and exemptions further complicate the process. The IRS with its annual tax filing deadline on April 15th
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is an institution that every American is familiar with. Income tax has come a long way since its inception
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During the civil war, it has evolved, expanded and become an integral part of the American financial landscape
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Love it or hate it. Income tax is here to stay shaping the nation's economy and funding vital programs
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Thank you for joining us on this journey through its history
