Sixteenth Amendment

The Sixteenth Amendment is an amendment to the US Constitution that allows Congress to tax income.

The Constitution of the United States is the document that serves as the  fundamental law of the country. An amendment is a change to something. An amendment to the Constitution is any text added to the original document since its ratification in 1788. The Constitution has been amended 27 times in American history.

The Sixteenth Amendment says:

“The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”

In short, the Sixteenth Amendment allows Congress to enact a federal (national) income tax, which it did soon after the amendment’s ratification. The federal income tax is still used today to fund the national government.

While Congress has always had the power to enact taxes, the Constitution’s wording limited what kinds of taxes it could create. In particular, Article I, Section 9, reads in part:

“No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.”

This meant that any direct tax must be taken proportionally, so that states were required to pay a tax based on the size of their population. In practice, this means a proportional federal income tax would be higher in a poor state with a large population than it would be in a rich state with a lower population. Thankfully, Congress did not want to enact such an unfair tax.

But a federal government needs regular funds to run the country. The Sixteenth Amendment was Congress’s solution to the problem. The amendment outright states that Congress has the power to collect a federal income tax.

Before 1864, Congress mostly funded the federal government through indirect taxes, such as tariffs and consumption taxes. However, these taxes affected the poor more heavily, because the wealthy generated most of their income through untaxed investments. So, Congress passed a nonproportional federal income tax in 1864, intending to tax the rich.

In 1895, however, the Supreme Court ruled that the 1864 income tax was unconstitutional, saying that the income tax was actually a direct tax and so must be proportional.

The situation stayed that way until 1909, when Congress passed the Sixteenth Amendment on July 2. It took four years to ratify it (on February 3, 1913), but since then the United States has had a nonproportional federal income tax to support the federal government.

While it might be difficult to find an American citizen who is happy to pay income tax, the tax is an important source of money for important programs and services that benefit the entire nation, such as Social Security, health programs like Medicare, and national defense. Thanks to the Sixteenth Amendment, money collected through the federal income tax has allowed the United States government to better support its citizens in many ways.

Passing the Sixteenth Amendment dramatically increased the federal government’s revenue, and today the income tax is still a large percentage of the US national budget.

The Sixteenth Amendment is very unpopular with most Americans, as nobody enjoys having to pay taxes.

You want to repeal the Second Amendment? Talk to me about the Sixteenth Amendment first.

— Chancellor of the Exchequer (@coachbugs) March 1, 2018

All I want for Christmas is the repeal of the Sixteenth Amendment.

— Brian McLaughlin (@BrianMcLaughl14) November 28, 2020

• Constitution of the United States
• amendment
• Congress
• federal
• taxation
• income tax
• direct tax

The Sixteenth Amendment allows Congress to enact a federal ______.

A. sales tax
B. income tax
C. estate tax
D. property tax