A reader asked why April 15 was chosen as tax day. Originally, back in 1913, the deadline was March 1. That's because Congress passed the 16th Amendment, which created the income tax on Feb. 3, 1913. Congress gave everyone a year plus six weeks as the first deadline. The Revenue Act of 1918 moved the date forward to March 15. In 1955 some tax-code revisions pushed the date a month further, to April 15.
Why? The IRS said it "spread out the peak workload." It could also be because, as the middle class grew, the IRS had to issue more refunds. Pushing back the deadline let them hold onto your money just a wee bit longer. (Source: Jessica Sung, "Why Is April 15 Tax Day?" Fortune Magazine, April 15, 2002)
What It Means to You
Tax Freedom Day was April 9 this year. It is the first day in each year that the Americans are not working just to pay taxes. This year, it was two weeks earlier than in 2007. That's because Americans pay less taxes thanks to, of all things, the recession. That's right, the recession reduced tax collections even faster than it reduced income. It also drove the Bush tax rebates in 2008, and the Obama tax cuts in 2009 and 2010.
Tax Related Articles
- Where Do Your Tax Dollars Go?
- What Is the Fair Tax Plan?
- Do Tax Cuts Lead to Budget Deficits?
- What Is Supply-Side Economics?
| 
(Photo Credit: Getty Images)
Comments