Sixteenth Amendment

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Sixteenth Amendment

The Sixteenth Amendment to the U.S. Constitution reads:

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.

Congress passed the Sixteenth Amendment to the U.S. Constitution in 1909, and the states ratified it in 1913. The ratification of the amendment overturned an 1895 U.S. Supreme Court decision that had ruled a 2 percent federal flat tax on incomes over $4,000 unconstitutional (pollock v. farmer's loan & trust co., 157 U.S. 429, 15 S. Ct. 673, 39 L. Ed. 759). Article I of the Constitution states that "direct taxes shall be apportioned among the several states … according to their respective numbers." By a 5–4 vote, the Court in Pollock held that the new Income Tax was a direct tax insofar as it was based on incomes derived from land and, as such, had to be apportioned among the states. Because the law did not provide for Apportionment, it was unconstitutional.

The decision was unpopular and took the public by surprise because a federal income tax levied during the U.S. Civil War had not been struck down. Critics contended that the conservative majority on the Pollock Court was seeking to protect the economic elite. Industrialization had led to the creation of enormous corporate profits and personal fortunes, which could not be taxed to help pay for escalating federal government services. The Democratic Party made the enactment of a constitutional amendment a plank in its platform beginning in 1896.

The language of the Sixteenth Amendment addressed the issue in Pollock concerning apportionment, repealing the limitation imposed by article I. Soon after the amendment was ratified, Congress established a new personal income tax with rates ranging from 1 to 7 percent on income in excess of $3,000 for a single individual.

Further readings

Jensen, Erik M. 2001. "The Taxing Power, the Sixteenth Amendment, and the Meaning of 'Incomes'." Arizona State Law Journal 33 (winter).

Oring, Mark, and Steve Hampton. 1994. "Cheek v. United States and the Tax Protest Movement: An Historical Reassessment of the Sixteenth Amendment." University of West Los Angeles Law Review 25 (annual).


Apportionment; Income Tax.

References in periodicals archive ?
They stress that Congress, in assembling the resolution that became the Sixteenth Amendment, carefully chose language to show that it didn't accept Pollock and that an expansive conception of "direct taxes" was wrong.
The decision is precedent on the scope of the Sixteenth Amendment and the taxation of all compensatory damages.
4 (holding that Congress is barred by Sixteenth Amendment from disallowing cost of goods sold); Hochman v.
The appeal before the 7th Circuit raises three fundamental questions of national significance: whether an American, charged with making a false statement, is entitled to present evidence that his statement is true; whether the injunction violates the First Amendment right to freedom of speech; and whether Secretary of State Knox abused his administrative function in proclaiming the Sixteenth Amendment ratified.
This definition of gross income is basically taken from the language used in the Sixteenth Amendment to the Constitution.
1 (1999) (arguing that the Sixteenth Amendment enables Congress and not the courts to decide what to tax); Marjorie Kornhauser, The Constitutional Meaning of Income and the Taxation of Gifts, 25 CONN.
After the Sixteenth Amendment was ratified, the United States Revenue Act of 1913 was enacted on October 3.
The Sixteenth Amendment to the Constitution was a response to the Pollock decision.
The plain meaning of the Second Amendment--if there is one--is palatable only to libertarians who find the plain meaning of other parts of the Constitution, such as the Sixteenth Amendment, anathema.
17) As discussed by Professor Kornhauser, the Supreme Court has struggled over the years with the realization concept in its numerous attempts to define "income" as the term is used in the Sixteenth Amendment of the United States Constitution.
It was not until 1913 that the federal government was able to effectively impose another income tax through the ratification of the Sixteenth Amendment to the Constitution.
Ever since the Sixteenth Amendment was ratified over ninety-five years ago and then upheld by the Supreme Court three years later, (1) the central debate over income taxation has focused on what will be taxed, how much it will be taxed, and for how long it will be taxed.