It's that time of year when you report your earnings to the government. Don't forget to fill out the necessary paperwork and get the most out of your deductions!
Usually taking place on April 15th every year, Tax Day is the date chosen by the United States Federal Government as the deadline for filing state and federal income tax returns. This is a date that affects only the United States, as other countries may handle their tax declarations in a different manner or timeline. In the years that this day falls on a Friday or the weekend, then the deadlines are moved forward and taxes are not due until the following Monday (or due Tuesday if it’s the weekend.) Sometimes, this day can come into conflict with national holidays (at a federal and state level.) so it is also pushed forward as an exception.
History of Tax Day
Tax Day is that day of the year in which taxpayers across the U.S. calculate the amount of money they owe to the federal government. Every year, the taxpayer’s employer withholds a portion of that person’s paycheck, which will be used to pay income taxes. The taxpayer then has to file a report with the IRS (Internal Revenue Service) or their corresponding tax agency, which provides the information needed by these entities to calculate the actual income tax owed by the individual person. On some occasions, it can happen that the taxpayer paid more than what they actually owed the government, then they are eligible for a tax refund for the previous year. For those who are self-employed, they get a refund if they overpaid their estimation of quarterly taxes. If they are due for a refund, the taxpayer can expect a check in the mail within a couple of weeks of filing the tax report.
When did the U.S. start to implement taxes?
One of the earliest mentions of taxes was during the American Civil War, when the Revenue Act of 1861 was implemented in order to help fund it, which in turn established the federal income tax but it was quickly declared unconstitutional. Other tax laws were enacted by the Revenue Act of 1862 and the 1894 Tariff Act —which regulated taxes on things such as rents from real estate, and interest income from other properties—, but it wasn’t until the Sixteenth Amendment to the U.S. Constitution came into effect and Congress was given the power to impose taxes. In 1913, a new Revenue Act was enacted which established a tax percentage on the net personal income. This percentage varied over the years (rising exponentially when crises or wars happened to finance them,) evolving into the modern tax income as it is today.
How to celebrate Tax Day
Tax Day isn’t actually a public holiday, nor can it really be considered a celebration since probably most of the American population sees taxes as a boring and tedious task that they have to do every year. It can also be a day that is dreaded by those who are not tax or financial-savvy, so the best way to celebrate this day is to get it over with quickly and efficiently. It is important that the paperwork (even when requesting an extension) is properly completed and filed with the IRS. The good news is that, if the tax filing is done correctly, then people can expect a refund!