Tax Trivia

Take note: A federal lien is a public record. Some people review these documents to call you and even harass you. Your credit score has taken a hit of about 100 points. You can take control and contact us. We will help build your case for reasonable cause, first time abatements, statutory exceptions or IRS waivers. Income Tax is over 100 years old The first income tax went into effect in 1861 to pay for the civil war. The US heavily borrowed from England and France at that time.

When the war was over and the national debt under control, that tax was eliminated. In 1913 the 16th Amendment to the Constitution allowed Congress the power to collect taxes on incomes. The first income tax was 1% on personal incomes over $3,000. During World War I the highest tax rate was 77%. In the 1950’s tax rates peaked at 91%. President Kennedy began a 50 year trend to reduce tax rates to the current maximum of 39.6% today. The 2014 Income Tax Law needs Congressional Action This Congress is dysfunctional and lacks the ability to address tax legislation that is needed before the 2014 elections.

So, what are the chances that a lame duck Congress will apply the patches and fixes to expiring tax benefits? Maybe the next Congress will pass retro-active legislation in 2015 to fix the 2014 tax problems that this current Congress is incapable of enacting. Or it is possible that working class adjustments and deductions will be removed from the tax code.

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The Medford Tax Experts, Inc.

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