Since the library will be closing while it is moving to a new location, several people have contacted the museum to see if we have the income tax forms. Since we're only open on Thursdays, Fridays, and Saturdays from 11 a.m. to 4 a.m., we shouldn't be the ones distributing the forms. Instead, the Jacksonville Chamber of Commerce has an inventory of tax forms.
During the sales talks, we could only wonder how the income tax came about. We didn't remember a single politician standing in front of his congressional delegates claiming to be the party that brought us the income tax! Furthermore, the constant issues seem to be lowering taxes, raising taxes on the "rich" or taxing large corporations. Still, the middle class pays 70% of all income taxes levied by the IRS year after year. So we wondered how that happened.
At the end of the civil war, the national debt rose to $ 5.2 billion. That was an increase of $ 465 million before the war. The government took several steps to clear the debt. They printed paper money that was not backed with gold and was called greenbacks. You sold bonds like those on display at your Vanishing Texana Museum. Before that, however, Congress had passed an income tax law in 1861. It put a 3% tax on all income over $ 800, about $ 24,000 in 2021. There was an immediate pushback from voters, so the quota was downgraded similar to today. Congress lifted the tax in 1872 but did not forget it.
In the immediate aftermath of the Civil War, industrial and financial markets generally flourished in the Northeast, but farmers in the South and West suffered from low prices for their produce. From 1870 to 1880 farmers founded political action organizations such as the Grange, the National Farmers Alliance and the People's Party (Populist). All of these groups advocated reforms that were considered very radical for the time. One of the reforms they sought was a tiered income tax aimed directly at the rich.
The first of the reforms passed was the Revenue Act, or the Wilson-Gorman Tariff of 1894, which lowered the tariffs set out in the McKinley Act of 1890. The reform law was largely supported by free trade members of the Democratic Party. To offset the loss of government income from the reduced tariff, a 2% tax was levied on income over $ 4,000 (about $ 120,000 in today's dollars). At this point in time, less than 1% of wage earners were affected.
A lawsuit has been brought to the Supreme Court. Although the court found the income tax legal during the Civil War, this income tax was found to be unconstitutional. Of course, those who supported the tax phrased the decision as further evidence of an alliance between government and big business against those who lived in rural areas. But around the turn of the century, when rail expansion reached areas like Jacksonville, prosperity returned and public demands for reform began to wane.
Although the public did not make any urgent demands, the political parties still had the programs they wanted to fund. The platforms of the Democratic Party, led by three-time presidential candidate William Jennings Bryant, consistently included an income tax feature. The progressive wing of the Republican Party also proposed an income tax for the rich.
Despite knowing it was unconstitutional, Congress again added an income tax to a collective bill. Conservatives, hoping to finally kill the idea, suggested changing the constitution to resolve the problem. They believed the change would never get the necessary approval from three-quarters of states. To her great surprise, state after state ratified the amendment until, on February 25, 1913, Secretary of State Philander C. Knox confirmed the votes, President Wilson signed them, and the 16th Amendment to the US Constitution became law. Immediately, Congress passed a new income tax that met with little public opposition. They imposed a rate of 1% on the rich, less than 1% of the population. The rest is history.
To collect tax forms, please visit the Jacksonville Chamber of Commerce at 1715 East Rusk St (Highway 79) east of Bill McRae Ford. They are open Monday through Friday, 8 am-5pm. And don't forget to visit your Vanishing Texana Museum at 302 South Bolton every Thursday, Friday or Saturday from 11 a.m. to 4 p.m.