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Here is some TAX tips before you file your 2011 TAX
www.nunez-services.com
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Income taxes are one of many ways to collect taxes, but they're among the most controversial.
Income taxes were first instituted in 1862, to help pay for the Civil War. At the time, the minimum
income to pay income tax was $600 per year. That miminum income to pay income tax is
equivalent to around $13,000 in today's dollars, but represents a much higher standard of living.
In other words, the original income taxes were meant mostly for the well-off or the super-rich, and
had a minimal effect on their lifestyles. With such a high minimum income to pay tax on income,
the issue of income taxes was a minor political issue. Few people paid it, and those who paid it
paid very little. Instead, most money was raised through tariffs and excise - people paid for the
govenrment by paying extra for the goods they consumed, while rich people (the ones who paid
taxes) earned extra money from these protective rules.
Interestingly engouh, the same argument is being replayed now that carbon taxes are becoming
significant. The minimum income to pay income taxes may keep creeping up thanks to middle-
class tax deductions, but an increase in energy costs hits nearly everyone. Superficially, the
minimum income to pay income tax hasn't changed, but below the surface, it's clear that the
minimum just keeps dropping.
The last time this debate was resolved, it happened through the Supreme Court. They ruled that a
direct tax on income was unconstitutional, so Congress amended the constitution to make it
viable. During the 1930's, increases in government spending and decreases in other revenue
forced income tax rates higher, to the point that taxes reached a high of 91%.
This number was deceptive, however. Extensive tax loopholes and credits allowed the rich to
avoid paying taxes in much of their income. For example, wealthy cattle owners and oil barrons
could get hefty deductions for their assets, even if they were making a profit from them. The
minimum income to pay income tax dropped with the introduction of FICA in the 1930's. Now,
workers owed some taxes on almost all the money they earned, regardless of how little it was.
Now, we've reached a compromise between sky-high taxes combined with easy loopholes. Top
income tax rates are under 40%, and more than half of the country doesn't pay taxes, even though
they technically earn more than the minimum income to pay income tax. What happens now is
that, as anyone who uses tax preparation software knows, you can find deductions and credits
that cause you to pay zero, or get money back, even if you have more than the minimum income.
Income tax is something you have to calculate, but for more and more Americans, it's not
something you have to pay.

2. Byrne Hobart is a New Yorker with widely, perhaps even bizarrely varied interests. He's interested
in financial history, particularly how things like the minimum income to pay tax change over time.
Article Source:
http://EzineArticles.com/?expert=Byrne_Hobart
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Here is some TAX tips before you file your 2011 TAX
www.nunez-services.com
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