As April 15th looms, many of us start to scramble. You know the day: Tax Day—the deadline to prove to the IRS that you paid the right amount of income tax, claim a refund if you overpaid, or begrudgingly send what you still owe. 

Before America went digital, it was common for American taxpayers to rush to a post office just before the 11:59 p.m. deadline on April 15th to get their tax returns postmarked and on their way to the IRS. Now, digital returns are more popular than ever. While this process is arguably more convenient, getting income tax forms filled out and filed correctly remains a stressor for many American taxpayers. 

Why do Americans go through this ordeal every year, and how did it begin in the first place? Let’s take a brief look at the history of income tax in the U.S. now. 

Timeline of Federal Income Tax History in the United States 

Our country’s approach to income tax and the tax code has changed many times over the years. This timeline highlights some of the major milestones: 

visual summary of how the U.S. Federal Income Tax System Evolved over time.
  • 1861: Congress passes a revenue act placing a tax on personal income to help cover the costs of the Civil War. 
  • 1871: Congress repeals the Revenue Act of 1861. 
  • 1894: Congress passes a flat-rate federal income tax that just one year later is ruled unconstitutional by the U.S. Supreme Court. 
  • 1909: With the passage of the Sixteenth Amendment to the U.S. Constitution, Congress grants itself the authority to impose an income tax on citizens without regard to their state’s population, overcoming the crux of the Supreme Court’s previous 1895 ruling.  
  • 1913: The Sixteenth Amendment is ratified. Congress sets an income tax filing deadline of March 1st. 
  • 1914: Form 1040 is introduced by the Treasury Department. 
  • 1918: Congress changes the income tax deadline to March 15th. 
  • 1953: The Internal Revenue Service, a reorganization of the long-standing Bureau of Internal Revenue, is established. 
  • 1998: The IRS significantly updates and restructures itself following the passage of the IRS Restructuring and Reform Act of 1998, a law that for the first time creates an independent taxpayer advocacy organization within the agency. 
  • 2017: President Donald Trump signs a $1.5 trillion tax reform bill, the largest adjustment to the tax system in decades. Among the changes were a 14% reduction in the corporate tax rate and the elimination of the personal exemption and expansion of the child tax credit from Form 1040 (for individuals and married couples). 

Why Was the U.S. Income Tax Created? 

The U.S. income tax system was born out of necessity. In 1861, during the Civil War, Congress passed the Revenue Act to generate funds for the Union war effort, marking the first time Americans were taxed directly on their income. Though this early tax was temporary, it laid the groundwork for future legislation. 

How Has Tax Filing Has Changed Over the Years? 

Tax filing has shifted from a manual, paper-based process to a fast, mostly digital experience. In the early days of income tax, taxpayers filled out paper forms like the now-famous Form 1040 by hand and mailed them to the IRS. Over time, filing requirements and deadlines evolved, with Tax Day eventually landing on April 15. 

The rise of digital technology marked a major turning point. Today, , making the process faster and more accessible. E-filing software, digital W-2s, and online tax tools have simplified what was once a paper-heavy and time-consuming task. 

Who Needs to Pay Federal Income Taxes Today? 

Today, most working Americans are required to file a federal income tax return if they earn above a certain threshold, which varies depending on factors like: 

  • Age 
  • Filing status 
  • Income type 

Currently single filers under age 65 must file if they earn more than $13,850. Self-employed individuals need to file if they earn over $400. Taxable income can include: 

  • Wages 
  • Freelance earnings 
  • Investment returns 

Because tax law is complex and ever-changing, many individuals and businesses turn to accountants to ensure compliance, maximize deductions, and reduce the risk of costly errors, making the role of accounting professionals more important than ever. 

Online Accounting Degrees to Advance Your Career 

Is it your passion to tackle taxes and other financial concerns as a career? Countless busy, frustrated, and confused American taxpayers are anxious to let a professional handle their annual income tax filing and other financial matters on their behalf. The University of Texas Permian Basin offers AACSB-accredited accounting degree programs to match your professional ambitions and education level—all available through an online classroom you can access from anywhere in the world at any time of day. Our programs include: 

Online Bachelor of Business Administration in Accounting 

Generally, you must earn at least a bachelor’s degree before working as an accountant. UT Permian Basin’s BBA in accounting program is designed to help you build the qualifications for accounting and related professional positions. This degree will equip you to take on accounting roles in governmental, private, public, and non-profit sectors. 

If you’ve already completed a bachelor’s degree and want to explore accounting at a more advanced level, you have two program choices: 

Online Master of Business Administration With Accounting Track 

Develop broader business acumen as you expand your expertise in traditional and modern accounting principles, strategic thinking, and decision-making with our online MBA in accounting. 

  • Choose our CPA track if you plan to seek CPA certification. 
  • Opt for our non-CPA track if you prefer broad accounting studies. 
  • Finish your degree in as little as four semesters. 

Online Master of Professional Accountancy 

In addition to honing your mastery of historical and current accounting practices and decision-making and strategic thinking skills in a business context, the curriculum of our Master of Professional Accountancy prepares you to sit for the Texas CPA exam. 

  • Check Texas state board requirements here. 
  • Finish your degree in as little as one year. 

The U.S. Bureau of Labor Statistics reports that some employers prefer to hire job candidates who have completed an accounting master’s degree! 

Benefits of Studying Accounting Online at UT Permian Basin 

UTPB’s online accounting degree programs offer a level of convenience that campus-based programs can’t: 

  • You don’t need to live in Texas or even in the United States to apply to a program and complete your degree. 
  • You’ll study the same rigorous curriculum under the guidance of the same PhD-level professors and field-experienced business professionals. 
  • You’ll get a top-quality education, wherever “here” may be for you. 

Ready to get started? Apply today! 

Sources: 
https://guides.loc.gov/this-month-in-business-history/april/tax-day
https://www.irs.gov/irs-history-timeline
https://money.cnn.com/2017/12/15/news/economy/gop-tax-plan-details/index.html

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