From Lincoln to Clinton

Paying off the Civil War

* 1862: Abraham Lincoln enacts and emergency measure to pay for Civil War: minimum 3% tax rate.

* 1872: Lincoln income tax law lapses.

* 1894: A 2% federal income tax law is enacted.

* 1895: Income tax is ruled unconstitutional by the U.S. Supreme Court in Pollack vs. Farmers Loan & Trust.

Blame it on Wyoming

* 1909: The 16th Amendment authorizing Congress to collect taxes on income is proposed.

* 1913: Wyoming casts the 37th vote, ratifying the 16th Amendment. One in 271 people pays tax (1% rate).

Tinkering Begins

* 1926: The Revenue Act of 1926 reduces taxes because too much money is being collected.

* 1939: Revenue statutes are codified. One in 32 citizens pays (4% rate).

* 1943: One out of three people pays income taxes. Withholding on salaries and wages is introduced.

* 1954: The 875-page Internal Revenue Code of 1954 passes. It is considered the most monumental overhaul of the federal income tax system to date, with 3,000 rule changes.

* 1969: The Tax Reform Act contains major amendments to the 1954 overhaul.

* 1984: The Reagan Tax Reform Act is most complex bill ever, with more than 180, technical corrections.

* 1986: The Tax Reform Act reduces tax brackets from five to two.

The Latest Fine-Tuning

1993: Bill Clinton’s Revenue Reconciliation Act passes by one vice presidential vote.

1995: A major budget stalemate shuts down the government. Clinton vetoes the Revenue Reconciliation Bill of 1995.

1996: Clinton signs the Taxpayer Bill of Rights 2.

1997: Taxpayer Relief Act brings more than 800 changes: child tax credit, Roth IRAs, capital gains tax rate cuts, breaks for higher education.

Source: CCH Inc.