Here’s the next installment of our exciting IRS history series – the story behind all those taxes you have to pay.
We know you were on the edge of your seats.
We left off in 1913, when the 16th Amendment finally made the income tax constitutional – and the very first Form 1040 was unleashed upon the world. (Imagine that first Form 1040. Did anyone have any idea all the trouble it would cause? Of course not. It’s fun to imagine how innocent things were back then.)
After that, things got interesting. Did you know….
- Starting in 1919, the IRS (then known as the Bureau of Internal Revenue) was one of the primary government agencies tasked with enforcing Prohibition. As always, the IRS is in the business of spoiling people’s fun. (Eleven years later, the Department of Justice took over this thankless job.)
- In 1931, the IRS Intelligence Unit was also responsible for finally putting away gangster Al Capone – by tracking him down and charging him with tax evasion. This has to go down as one of the greatest “But…. But…. But….” moments in history.
- After Prohibition, the IRS took over responsibility for administering the National Firearms Act. Alcohol, guns, and gangsters – all part of a day’s work for the Internal Revenue Service, apparently.
Sadly, after those early years, the Wild West of the IRS settled down into the endless sea of papers and regulations that we know today. Some “highlights” of these years include:
- 1942 – The “Revenue Act” increased taxes and introduced medical and investment deductions.
- 1943 – The “Current Tax Payment Act” introduced the requirement for employers to withhold taxes from their employees’ wages.
- 1953 – The Bureau of Internal Revenue officially became the IRS.
- 1954 – “Tax Day” moved from March 15th to April 15th, where it’s been ever since.
- 1972 – The last traces of the Wild West disappeared when the Alcohol, Tobacco and Firearms division of the IRS split off and became a separate organization (the Independent Bureau of Alcohol, Firearms and Tobacco).
After that, it’s pretty much been business as usual.
But it’s up to us to keep the legend alive.
If you have any questions about the IRS, or about the Wild West, don’t hesitate to give us a call at 844-841-9857, or schedule a free consultation here.
Additional Readings
As a business owner, you know everything there is to know about your industry. You could be an expert on your specific business, but how much do you know about business taxes? If you are like other business owners, you might not know a lot. Luckily, there are professionals who can guide you through the basic and specific tax...
If your loved one recently passed away, you may have many questions about filing income tax for them. Perhaps the most important thing is to understand that you are not alone. Dealing with a deceased’s unpaid taxes can be challenging. For example, who is responsible for paying taxes when someone dies? Do IRS debts go...
If you have a tax balance with the IRS, you may be wondering if you can get a passport. While having your passport renewal denied or revoked is a possibility, it depends on the amount you owe the IRS. If your taxes become seriously delinquent, the IRS can take action against you, leading to the...
Most employers in the United States completely shut down or suspended operations during the COVID-19 pandemic. To help such businesses, the federal government implemented various policies, including the Employee Retention Tax Credit (ERTC) or Employee Retention Credit (ERC) program. However, it can take the IRS months to process claims because of the number of applications the...
If you’re a small business owner, you’ve probably heard about sales tax. Knowing how to collect, record and remit sales tax can be complicated, especially as your business grows. Keeping up with changing tax regulations can also be challenging. Paying sales tax for your small business is essential because failing to do so can result...
The Employee Retention Credit (ERC), also known as the Employee Retention Tax Credit (ERTC), will unveil some major changes at the start of 2024. Starting in September of 2023, the IRS Commissioner placed a moratorium on new ERC applications through the end of the year, giving the IRS time to update its guidelines and develop a new...