An Overview of the 16th Amendment

What is the 16th Amendment?

“The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”

The16th Amendment Defined

Date Proposed

The 16th Amendment was proposed on July 12th, 1909

Date Passed

The 16th Amendment was passed on February 3rd, 1913

President of the United States

William H. Taft was the President of the United States during the ratification of the 16th Amendment

Stipulations of the 16th Amendment

The United States Constitution (Article 1, Section 8) prohibited the implementation of unapportioned and direct taxation; as a result, the levy of income tax – once permitted to be regulated on a state-level prior to the ratification of the 16th Amendment – was placed under the jurisdiction of the Federal Government

The 16th Amendmentestablished the latent differencesexisting between direct taxes and indirect taxes; the amendment states that certain income tax be considered as an excise, indirect tax. However, taxation with regard to property rental and interest were considered to be direct taxes; as a result, such taxes were moved under the jurisdiction of the Federal Government

The 16th Amendment substantiates that the classification of a tax as ‘direct’ or ‘indirect’ is irrelevant; this amendment states that a Federal income tax can be collected without regard to an individual state’s respective population or gross amount of income

16th Amendment Facts

A Direct Tax is a tax that is collected directly from a governmental body

A flat tax is consistent in its rate; it does not fluctuate

The Revenue Act of 1861, which was passed during the Civil War in order to garner funding for combat, mandated that any or all income exceeding $800 would be subject to a %3 flat tax

The Wilson-Gorman Tariff Act, which was passed in 1894, mandated that any or all income exceeding $4,000 would be liable to undergo a 2% tax

States Ratifying the 16th Amendment

1. Alabama

2. Arizona

3. Arkansas

4. California

5. Colorado

6. Delaware

7. Georgia

8. Idaho

9. Illinois

10. Indiana

11. Iowa

12. Kansas

13. Kentucky

14. Louisiana

15. Maine

16. Maryland

17. Massachusetts

18. Michigan

19. Minnesota

20. Mississippi

21. Missouri

22. Montana

23. Nebraska

24. Nevada

25. New Hampshire

26. New Jersey

27. New Mexico

28. New York

29. North Carolina

30. North Dakota

31. Ohio

32. Oklahoma

33. Oregon

34. South Carolina

35. South Dakota

36. Tennessee

37. Texas

38. Vermont

39. Washington

40. West Virginia

41. Wisconsin

42. Wyoming

States Not Participatory in the Ratification of the 16th Amendment

1. Connecticut

2. Florida

3. Pennsylvania

4. Rhode Island

5. Utah

6. Virginia

Court Cases Associated with the 16th Amendment

Pollock v. Farmers’ Loan & Trust Co. (1895) – a court case involving Massachusetts resident Charles Pollock, who argued that while state-regulated income taxes were considered to be direct taxes, they were not subject to apportionment; as a result, Pollock argued that unapportioned, state-regulated direct taxes were in the direct violation of the Constitution – the Supreme Court ruled in favor of Pollock, which resulted in the proposal of the 16th Amendment

Subsequent to the Supreme Court ruling with regard to Charles Pollock, the 16th Amendment stood to clarify the distinction between presumed indirect and direct taxes.

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