Income tax - Revision history

Quidam65: /* States and Local Municipalities */

2024-07-02T17:43:55Z

States and Local Municipalities

Quidam65: /* States and Local Municipalities */

2024-07-02T17:41:03Z

States and Local Municipalities

Quidam65: /* States and Local Municipalities */

2023-03-04T21:47:15Z

States and Local Municipalities

Quidam65: /* Year 2007 income brackets and tax rates */ delete section as outdated

2023-03-04T21:45:19Z

Year 2007 income brackets and tax rates: delete section as outdated

Progressingamerica: Expanded. Added Theodore Roosevelt's role in the revival of progressive taxation; Taft's advocacy, states ratified.

2021-10-06T01:16:12Z

Expanded. Added Theodore Roosevelt's role in the revival of progressive taxation; Taft's advocacy, states ratified.

Progressingamerica: Moved image

2020-07-08T22:22:00Z

Moved image

Progressingamerica: Need history section.

2020-07-08T22:21:11Z

Need history section.

DavidB4-bot: clean up & uniformity

2016-07-13T14:17:33Z

clean up & uniformity

at 00:54, January 5, 2016

2016-01-05T00:54:05Z

TorysaurusRex: Added a reference

2013-01-12T15:41:42Z

Added a reference

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 However, not all states use a progressive form of income tax, some use a flat rate, and generally assess income tax only on income earned within that state.
-Seven states do not assess an income tax on individuals.
+Nine states do not assess an income tax on all or most individual income: [[Alaska]], [[Washington]], [[Nevada]], [[Wyoming]], [[South Dakota]], [[New Hampshire]], [[Tennessee]], [[Florida]], and [[Texas]].
 ==Other Taxation systems==

← Older revision		Revision as of 17:41, July 2, 2024
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	However, not all states use a progressive form of income tax, some use a flat rate, and generally assess income tax only on income earned within that state.		However, not all states use a progressive form of income tax, some use a flat rate, and generally assess income tax only on income earned within that state.
		+
		+	Seven states do not assess an income tax on individuals.

	==Other Taxation systems==		==Other Taxation systems==

@@ Line 18: / Line 18: @@
 ==States and Local Municipalities==
-Most states and even some cities asses a tax on income, further increasing the amount of money withheld before a worker even sees their paycheck.  For example, in [[Maryland]], each [[county]] and the [[independent city]] of [[Baltimore]] collect a local income tax of up to 3.2%<ref>[http://individuals.marylandtaxes.com/incometax/localtax.asp Maryland Local Income Tax]</ref> on top of the state income tax, whose marginal rate is 4.75% for most earners and 6.25% for the top earners.<ref>[http://individuals.marylandtaxes.com/incometax/ratesbrackets.asp Maryland Income Tax Rates and Brackets]</ref>  This means that a taxpayer in [[Montgomery County, MD|Montgomery County]] pays a combined state and county rate of 7.95% if that person is a typical earner or 9.45% if that person is a top earner.
+Most states and even some cities assess a tax on income, further increasing the amount of money withheld before a worker even sees their paycheck.
 ==Other Taxation systems==

← Older revision		Revision as of 21:45, March 4, 2023
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	Since the Reagan Revolution of the 1980s, the top income tax rate paid by the rich has fallen sharply. However the proportion of GDP absorbed by federal taxes has remained constant at about 20%, in accord with Hauser's Law.<ref>See [http://online.wsj.com/article/SB121124460502305693.html David Randon, "You Can't Soak the Rich," ''Wall Street Journal'' May 20, 2008]</ref> Growth, however, has halved since the top rate of tax was cut. [[Liberal]] critics of [[Free Market]] capitalism point at this as evidence that cutting taxes does not benefit the whole of society, just the rich.<ref>http://thinkprogress.org/economy/2012/09/12/840641/tax-cuts-rich-economic-growth/</ref>		Since the Reagan Revolution of the 1980s, the top income tax rate paid by the rich has fallen sharply. However the proportion of GDP absorbed by federal taxes has remained constant at about 20%, in accord with Hauser's Law.<ref>See [http://online.wsj.com/article/SB121124460502305693.html David Randon, "You Can't Soak the Rich," ''Wall Street Journal'' May 20, 2008]</ref> Growth, however, has halved since the top rate of tax was cut. [[Liberal]] critics of [[Free Market]] capitalism point at this as evidence that cutting taxes does not benefit the whole of society, just the rich.<ref>http://thinkprogress.org/economy/2012/09/12/840641/tax-cuts-rich-economic-growth/</ref>
−
−	~~==Year 2007 income brackets and tax rates==~~
−	An individual's marginal income tax bracket depends upon their [[income]] and their tax-filing classification. As of 2007, there are six tax brackets for ordinary [[income]] (ranging from 10% to 35%) and four classifications: single, married filing jointly (or qualified widow or widower), married filing separately, and [[Head of Household (Tax)\|head of household]].
−	~~{\| class=wikitable style="text-align:right"~~
−	\|-
−	~~! width=75 \| Marginal Tax Rate~~
−	~~! width=150 \| Single~~
−	~~! width=150 \| Married Filing Jointly or Qualified Widow(er)~~
−	~~! width=150 \| Married Filing Separately~~
−	~~! width=150 \| Head of Household~~
−	\|-
−	~~!10%~~
−	~~\| $0 – $7,825 \|\| $0 – $15,650 \|\| $0 – $7,825 \|\| $0 – $11,200~~
−	\|-
−	~~!15%~~
−	~~\| $7,826 – $31,850 \|\| $15,651 – $63,700 \|\| $7,826 – $31,850 \|\| $11,201 – $42,650~~
−	\|-
−	~~!25%~~
−	~~\| $31,851 – $77,100 \|\| $63,701 – $128,500 \|\| $31,851 – $64,250 \|\| $42,651 – $110,100~~
−	\|-
−	~~!28%~~
−	~~\| $77,101 – $160,850 \|\| $128,501 – $195,850 \|\| $64,251 – $97,925 \|\| $110,101 – $178,350~~
−	\|-
−	~~!33%~~
−	~~\|$160,851 – $349,700 \|\| $195,851 – $349,700 \|\| $97,926 – $174,850 \|\| $178,351 – $349,700~~
−	\|-
−	~~!35%~~
−	~~\|$349,701+ \|\| $349,701+ \|\| $174,851+ \|\| $349,701+~~
−	\|}
−
−	An individual pays tax at a given bracket only for each dollar within that bracket's range. For example, a single taxpayer who earned $10,000 of [[income]] in 2007 would be taxed 10% of each dollar earned from the 1st dollar to the 7,825th dollar (10% × $7,825 = $782.50), then 15% of each dollar earned from the 7,826th dollar to the 10,000th dollar (15% × $2,175 = $326.25), for a total of $1,108.75. Notice this amount ($1,108.75) is lower than if the individual had been taxed at 15% on the full $10,000 (for a tax of $1,500). This is because the individual's marginal rate (the percentage tax on the last dollar earned, here 15%) has no effect on the [[income]] taxed at a lower bracket (here the first $7,825 of [[income]] taxed at 10%). This ensures that every rise in a person's pre-tax salary results in an increase of their after-tax salary, contrary to the popular misconception that being bumped into a higher tax bracket reduces after-tax [[income]].

	==States and Local Municipalities==		==States and Local Municipalities==

@@ Line 1: / Line 1: @@
 [[Image:Hauserlaw.jpg|thumb|275px|[[Hauser's law]]]]
-'''Income tax''' is a tax levied by government on the income of individuals and businesses.  The income tax was first introduced in the [[United States]] in 1862 as a levy on the salary of federal officers. In 1913, the [[Sixteenth Amendment]] to the Constitution made clear the federal government can collect taxes from any source, free from the previous requirement to apportion the tax among the [[states]] in proportion to their [[census]] [[population]]s.
+'''Income tax''' is a tax levied by government on the income of individuals and businesses, championed by progressives.
 ==History==
-The Amendment won near-unanimous support from conservatives at the time. The federal income tax started low but became high during [[World War I]]; it was lowered in the 1920s by the conservatives.  Most states and some localities (especially New York City) levy their own income tax. Taxes were raised by Republican President [[Herbert Hoover]] in 1932, and jumped to very high levels during [[World War II]] to pay for the war.  The '''[[Withholding|withholding tax]]''' was introduced in 1943 so people would pay taxes from every paycheck, instead of waiting until next spring.<ref>The withholding tax was devised by economist [[Milton Friedman]], at the time a liberal.</ref>
+The income tax was first introduced in the [[United States]] in 1862 as a levy on the salary of federal officers, which was repealed in 1872.  The tax was again introduced by the Wilson-Gorman Tariff Act of 1894, but was struck down by the Supreme Court the next year in [[Pollock v. Farmers Loan & Trust Co.]].  This court decision had progressives seething with anger and hatred for many years.
 Income taxes are collected by the [[Internal Revenue Service]].  Some [[Republicans]], who advocate a smaller government and believe that it would be more efficient and less expensive, work hard to cut income taxes.

@@ Line 1: / Line 1: @@
 '''Income tax''' is a tax levied by government on the income of individuals and businesses.  The income tax was first introduced in the [[United States]] in 1862 as a levy on the salary of federal officers. In 1913, the [[Sixteenth Amendment]] to the Constitution made clear the federal government can collect taxes from any source, free from the previous requirement to apportion the tax among the [[states]] in proportion to their [[census]] [[population]]s.
@@ Line 7: / Line 8: @@
 Since the Reagan Revolution of the 1980s, the top income tax rate paid by the rich has fallen sharply. However the proportion of GDP absorbed by federal taxes has remained constant at about 20%, in accord with Hauser's Law.<ref>See [http://online.wsj.com/article/SB121124460502305693.html David Randon, "You Can't Soak the Rich," ''Wall Street Journal'' May 20, 2008]</ref> Growth, however, has halved since the top rate of tax was cut. [[Liberal]] critics of [[Free Market]] capitalism point at this as evidence that cutting taxes does not benefit the whole of society, just the rich.<ref>http://thinkprogress.org/economy/2012/09/12/840641/tax-cuts-rich-economic-growth/</ref>
 ==Year 2007 income brackets and tax rates==

← Older revision		Revision as of 22:21, July 8, 2020
Line 1:		Line 1:
−	'''Income tax''' is a tax levied by government on the income of individuals and businesses. The income tax was first introduced in the [[United States]] in 1862 as a levy on the salary of federal officers. In 1913, the [[Sixteenth Amendment]] to the Constitution made clear the federal government can collect taxes from any source, free from the previous requirement to apportion the tax among the [[states]] in proportion to their [[census]] [[population]]s. The Amendment won near-unanimous support from conservatives at the time. The federal income tax started low but became high during [[World War I]]; it was lowered in the 1920s by the conservatives. Most states and some localities (especially New York City) levy their own income tax. Taxes were raised by Republican President [[Herbert Hoover]] in 1932, and jumped to very high levels during [[World War II]] to pay for the war. The '''[[Withholding\|withholding tax]]''' was introduced in 1943 so people would pay taxes from every paycheck, instead of waiting until next spring.<ref>The withholding tax was devised by economist [[Milton Friedman]], at the time a liberal.</ref>	+	'''Income tax''' is a tax levied by government on the income of individuals and businesses. The income tax was first introduced in the [[United States]] in 1862 as a levy on the salary of federal officers. In 1913, the [[Sixteenth Amendment]] to the Constitution made clear the federal government can collect taxes from any source, free from the previous requirement to apportion the tax among the [[states]] in proportion to their [[census]] [[population]]s.
		+
		+	==History==
		+	The Amendment won near-unanimous support from conservatives at the time. The federal income tax started low but became high during [[World War I]]; it was lowered in the 1920s by the conservatives. Most states and some localities (especially New York City) levy their own income tax. Taxes were raised by Republican President [[Herbert Hoover]] in 1932, and jumped to very high levels during [[World War II]] to pay for the war. The '''[[Withholding\|withholding tax]]''' was introduced in 1943 so people would pay taxes from every paycheck, instead of waiting until next spring.<ref>The withholding tax was devised by economist [[Milton Friedman]], at the time a liberal.</ref>

	Income taxes are collected by the [[Internal Revenue Service]]. Some [[Republicans]], who advocate a smaller government and believe that it would be more efficient and less expensive, work hard to cut income taxes.		Income taxes are collected by the [[Internal Revenue Service]]. Some [[Republicans]], who advocate a smaller government and believe that it would be more efficient and less expensive, work hard to cut income taxes.

@@ Line 3: / Line 3: @@
 Income taxes are collected by the [[Internal Revenue Service]].  Some [[Republicans]], who advocate a smaller government and believe that it would be more efficient and less expensive, work hard to cut income taxes.
-Since the Reagan Revolution of the 1980s, the top income tax rate paid by the rich has fallen sharply. However the proportion of GDP absorbed by federal taxes has remained constant at about 20%, in accord with Hauser's Law.<ref> See [http://online.wsj.com/article/SB121124460502305693.html David Randon, "You Can't Soak the Rich," ''Wall Street Journal'' May 20, 2008]</ref>. Growth, however, has halved since the top rate of tax was cut. [[Liberal]] critics of [[Free Market]] capitalism point at this as evidence that cutting taxes does not benefit the whole of society, just the rich<ref>http://thinkprogress.org/economy/2012/09/12/840641/tax-cuts-rich-economic-growth/</ref>.
+Since the Reagan Revolution of the 1980s, the top income tax rate paid by the rich has fallen sharply. However the proportion of GDP absorbed by federal taxes has remained constant at about 20%, in accord with Hauser's Law.<ref>See [http://online.wsj.com/article/SB121124460502305693.html David Randon, "You Can't Soak the Rich," ''Wall Street Journal'' May 20, 2008]</ref> Growth, however, has halved since the top rate of tax was cut. [[Liberal]] critics of [[Free Market]] capitalism point at this as evidence that cutting taxes does not benefit the whole of society, just the rich.<ref>http://thinkprogress.org/economy/2012/09/12/840641/tax-cuts-rich-economic-growth/</ref>
 [[Image:Hauserlaw.jpg|thumb|275px]]
@@ Line 48: / Line 48: @@
 http://usinfo.state.gov/products/pubs/oecon/chap12.htm
-====references====
+====References====
 <references/>
 [[Category:Economics]]
 [[Category:Business]]
 [[Category:Taxation]]