Congressional Power to Tax Income 1909
The 16th amendment, passed by Congress on July 2, 1909, and ratified on February 3, 1913, established Congress’s ability to levy a Federal income tax.
The income tax change, which has far-reaching social and economic implications, was enacted into law through a strange chain of events that culminated in a bungled political manoeuvre.
The first American income tax was enacted in 1861 in response to the financial demands of the Civil War. Congress first imposed a flat 3-percentage-point tax on all incomes above $800, but subsequently changed this premise to include a tiered tax. The income tax was repealed by Congress in 1872, but the notion remained.