The first federal individual income tax in America debuted during the Civil War with the Revenue Act of 1861. That act provided for a single tax rate of 3 percent levied on incomes above $800. After the war, the income tax was repealed and the feds relied on tariffs for funding. But tariffs are regressive and hit the middle class with higher prices. So in 1894 Congress passed the Wilson–Gorman Tariff Act, which included the first peacetime federal income tax: 2 percent on incomes over $4,000. But the new income tax was declared unconstitutional in Pollock v. Farmers' Loan & Trust Co. The Supreme Court found that it violated Article I, Section 9, Paragraph 4: “No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or enumeration herein before directed to be taken.” So, if our federal overlords were to have their income tax, they would need to amend the Constitution, which meant they would need a little cooperation from the...(Read Full Article)