When Do You File a Tax Return
Below is a MRR and PLR article in category Finance -> subcategory Taxes.
When Do You File a Tax Return?
Summary:
Every year, millions of Americans prepare to either pay taxes or collect refunds from the IRS. But when did April 15 become synonymous with tax day, and why? Let's explore the history of this date and when you're required to file a tax return.Article:
The Origins of Income Tax in America
The concept of an income tax in the United States dates back to the 1860s under President Abraham Lincoln. To cover the mounting costs of the Civil War, the government established the Commissioner of Revenue and enacted an income tax law.Evolution of the Tax Deadline
Initially, the deadline for filing individual income tax was set to March 1. In 1918, Congress extended it to March 15. It wasn't until the 1954 tax code overhaul that April 15 became the date we know today. Historically speaking, this has not been in place for very long, and changes are always possible.Filing Requirements
Individual taxpayers must file a tax return or apply for an extension using Form 4868 by April 15. Corporations and other entities have a deadline of March 15, with the option to request an extension as well. Remember, an extension grants more time to file, not to pay any taxes owed, which must still be estimated and paid on time to avoid penalties.Shifts in Tax Responsibility
After WWII, both corporations and individuals shared tax burdens more evenly. However, the balance has shifted, and individuals now bear a larger share. In 1867, public outcry against taxes led to a repeal, leaving the government dependent on liquor, beer, wine, and tobacco sales for revenue until 1913. However, when Prohibition began in 1919, income tax became essential for government funding.Taxation Through the 20th Century
The Revenue Act of 1942, part of the New Deal era, marked further expansion of government power and expenditure. Today, the U.S. government, a trillion-dollar entity, depends heavily on taxpayers, consuming a significant portion of earned income. Efforts to address Social Security funding issues suggest this will only increase.The Role of the IRS
Tax regulations fall under the authority of the Internal Revenue Service (IRS), which is divided into four main sectors: Wage and Investment, Small/Business Self-Employed, Large and Midsize Business, and Tax Exempt and Government Entities. Each division focuses on its respective area to manage tax-related responsibilities effectively.In summary, while April 15 is a well-known date, the history and nuances of tax filing demonstrate the evolving nature of taxation in America. Understanding your filing requirements and deadlines can help you avoid unnecessary penalties.
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