when did the irs come into existence and why
Internal Revenue Service The IRS originated with the Commissioner of Internal Revenue, a federal office created in 1862 to assess the nation's first income tax, which was to raise funds for the American Civil War. The temporary measure provided over a fifth of the Union's war expenses and was allowed to expire a decade later. In 1913, the Sixteenth Amendment to the U.S. Constitution was ratified authorizing Congress to impose a tax on income, and the Bureau of Internal Revenue was established. In the 1950s, the agency was renamed the Internal Revenue Service and significantly reorganized. The Tax Reform Act of 1986 modernized the IRS and restructured it along a private sector model.
History of taxation in the United States Congress enacted an income tax in October 1913 as part of the Revenue Act of 1913, levying a 1% tax on net personal incomes above $3,000, with a 6% surtax on incomes above $500,000. By 1918, the top rate of the income tax was increased to 77% (on income over $1,000,000, equivalent of 15,300,000 in 2012 dollars[20]) to finance World War I. The average rate for the rich however, was only 15%.[21] The top marginal tax rate was reduced to 58% in 1922, to 25% in 1925 and finally to 24% in 1929. In 1932 the top marginal tax rate was increased to 63% during the Great Depression and steadily increased, reaching 94% (on all income over $200,000, equivalent of 2,500,000 in 2012 dollars[22])in 1945. During World War II, Congress introduced payroll withholding and quarterly tax payments.[23]