Tax Tip of the Week | No. 229 | Happy 100th To Form 1040!
Tax Tip of the Week | December 18, 2013 | No. 229 | Happy 100th To Form 1040!Before we leave....
As we say goodbye to 2013, we would be remiss not to acknowledge the 100th Anniversary of the Form 1040 tax return.Our system of collecting personal income taxes made its debut in 1913 following the ratification of the 16th Amendment. The original Form 1040 was three pages, plus a single page of instructions.That’s it----the entire package was four pages long! That’s a far cry from today’s multitude of forms and schedules not to mention the thousands of pages of instructions.Only Americans with net incomes exceeding $3,000 were required to file. The initial tax rate was 1% with a maximum tax rate of 6% for net incomes exceeding $500,000. Based on the cost of living at the time, only about 35% of taxpayers were required to file that first tax return.Here is a link to that first Form 1040: [http://www.irs.gov/pub/irs-utl/1913.pdf]. This is a fun form to peruse. There are some great archaisms here, including discussion of “losses occurred during shipwreck”, provisions for mine owners, and detailed instructions for how farmers are supposed to figure income on wool and hides of slaughtered animals.This initial form was due March 1, 1914. Hopefully our forefathers and mothers in Dayton had the records they needed to complete this form following the Great Dayton Flood of 1913.