The 16th Amendment paved the way for capital gains taxes

The US officially adopted an income tax in 1913

The US first levied income taxes during the Civil War, but modern income taxes became an American fixture in 1913. Two years earlier, Congress passed the 16th Amendment to give the government the right to tax individuals' and businesses' income. The US still technically levies the same federal income tax now as it did then—though it's evolved.

Before the 16th Amendment, US tax law required direct taxes to be directly apportioned to a state's population

Due to these requirements, the federal government could not impose many direct taxes. Direct taxes include property and income taxes, whereas indirect taxes include duties and excises.

Capital gains taxes were first levied in the US in 1913

However, up until 1921, they were treated the same as ordinary income. Ever since then, rates have swung up and down.

How the federal income tax affected Prohibition

In the early 1900s, 30% to 40% of government tax revenue came from liquor, wine, and beer, a reliance that made Prohibition seem like a fiscal impossibility. But the passage of the federal income tax in 1913 changed the calculus, which helped allow the government to ban alcohol production and sales.

Why do long-term capital gains get taxed at preferential rates?

The 1920s defined capital gains as “unearned” taxable income—as opposed to “earned” income from jobs—and set into practice preferential tax rates for long-term capital gains that are hotly debated to this day. This historical review explores how voices in favor of preferential rates were arguing on behalf of greater market liquidity and incentive for investment activity. Learn more about the real history of capital gains tax rates here.

Revenue from tariffs goes to the US Treasury’s general fund

That's also where federal income taxes go. Revenue from tariffs can be spent on almost anything the government needs, such as funding programs like Medicare or the military.

The Tariff Act of 1789 was one of America's first acts

One of the first acts ever passed by the United States Congress instituted tariffs on foreign goods. The bill was sponsored by then-Congressman James Madison and signed into law by President George Washington. The goods the first Congress felt necessary to tax included Jamaican rum, playing cards, and—of course—British tea.

US Tariff revenue rose to $264B in 2025—More than double that of recent years

In April 2025, President Donald Trump announced tariffs on countries across the globe, raising them to unprecedented levels in modern American history. The increase in tariff rates led to a significant rise in tariff revenue.

If the estate tax is repealed, more expensive alternatives might come in its place

The federal estate tax has been up for political debate for decades. Many want to get rid of it altogether. If repealed other tax options, like capital gains taxes, could have people paying more in taxes than before.

The Constitution gives Congress sweeping control over the federal budget

Article I, Section 8's Spending Clause authorizes Congress to tax, pay debts, and promote the "common Defence and general Welfare," making it one of Congress's most powerful tools—and the constitutional foundation of federal budget control.

The 15th Amendment granted Black men the right to vote nationwide

Ratified in 1870, the 15th Amendment prohibited federal and state governments from denying the right to vote based on race, color, or previous condition of servitude—enfranchising millions of Black men.

In 2019, Congress passed the Secure Act to reform key aspects of the US tax code

Key Secure Act provisions included raising the age at which mandatory distributions take effect (to increase saving), allowing larger catch-up contributions for older individuals, and allowing employers to directly match contributions in a Roth 401(k).

The Bill of Rights originally proposed 12 amendments, not 10

Congress proposed 12 amendments in 1789, not 10. Of the two amendments not ratified, the one on congressional pay raises remained dormant for 203 years before finally becoming the 27th Amendment in 1992.

The 21st Amendment was the only amendment to repeal another

The 1933 constitutional amendment rolled back 1920's 18th Amendment, better known as Prohibition, which outlawed "the manufacture, sale or transportation of intoxicating liquors."

The Civil War permanently strengthened federal power

The Civil War expanded federal power through emancipation, national military mobilization, and postwar civil rights laws, permanently strengthening the national government and shifting the balance of authority away from the states.

Tax policy can have a direct impact on the national debt

Past presidents' changes to tax codes have inflated the deficit. An expert on the topic explains the interplay between policy and the national budget while debunking 10 tax-related myths in this podcast.

A boom hit after WWI, with consumerism usurping frugality as an American value

When American soldiers returned home after WWI in the 1920s, they found a country ready to spend money, make a home, and indulge in creature comforts after wartime rationing. This uptick in US wealth and production led to job opportunities for advertising experts.

JP Morgan Jr. once angered the nation with his zero-dollar tax bill

In the aftermath of the Great Depression, Congress learned that Morgan and his banking partners had avoided paying any federal income tax in 1931 and 1932. By claiming their losses in the stock market, they seemingly erased what they owed.

The Seventh Amendment guarantees the right to a jury trial in federal civil cases

Ratified in 1791, this amendment applies to cases where more than $20 is at stake—an amount that has never been adjusted for inflation.

The New York Stock Exchange wouldn't have been made if not for municipal bond sales

The Funding Act of 1790 nationalized and consolidated the debt held by the 13 colonies to be sold off in the form of bonds.

US states have reported over $25B in tax revenue from recreational cannabis sales and medical marijuana

Colorado and Washington became the first states to allow the sale of cannabis products in 2014. Since then, many more states have legalized marijuana in some capacity—and it's been a boon for state budgets. California now regularly collects more than $1B in marijuana tax revenue each year, for instance.

How America became a nation of gamblers

For thousands of years, humans have liked to gamble. What started as dice games and betting on chariot races became a way for states to generate revenue here in America. This article explores how states have been using gambling to pay for infrastructure and capital projects–and the cost it’s had on the citizens.

The 1956 Federal-Aid Highway Act spent $25B to build 41,000 miles of freeway

Sold to Congress as a national defense measure, the Interstate Highway Act committed the federal government to covering 90 cents of every dollar spent on a 41,000-mile freeway network, a subsidy that reshaped American cities and supercharged car dependency.

A rising number of Social Security beneficiaries are taxed on their Social Security income

That’s because while Social Security benefits increase with wages and inflation, the income limits for taxing those benefits stay the same and don’t adjust over time.

US inflation can generally be split into to two periods—before and after the Federal Reserve

A central bank itself does not mean significant inflation will occur, but economists generally point to factors like two world wars and the printing of money to finance the US federal deficit as primary drivers of price increases.

Calculate how much of your tax dollars go to each federal program based on your income, filing status, and number of children

The US Constitution is widely regarded as the longest-standing written national constitution still in force—see how it has influenced rights worldwide.

The power and influence of the American presidency have expanded significantly over time—far beyond what the founders envisioned.

Jimmy Carter signed a 1978 bill that legalized home brewing, a move credited with kick-starting the craft beer industry.

While the first exchange-traded fund (a 'basket' of different assets that can be bought and sold on a stock exchange) in the US only launched in 1993, the global ETF market has grown to more than $10T in the short time since.

After the Boston Tea Party, colonists switched to coffee, which became the main morning drink for revolutionaries.

US consumers collectively owe more than $1T to credit card companies—almost as much as they owe in auto loans.

See a ranking of the best (and worst) Federal Reserve Chairs since 1914 out of the 16 men and women who have held the office since.

At the beginning of the 20th century, a group of young men ate standard American food—replete with food additives like borax and formaldehyde—as part of government research to better understand food safety.

The American Society of Civil Engineers' infrastructure report card gave the US a C in 2025, its highest grade since the project launched in 1998.

Mark Twain spent decades feuding with the US Postal Service, convinced its costs and regulations were bureaucratic overreach.

Dozens of S&P 500 stocks, including Coca-Cola and Walmart—known as the dividend aristocrats—have increased dividends every year for 25 years

Art theft is the third-largest source of criminal revenues worldwide, thanks in part to the subjective nature of valuing a work of art.

The word 'jazz' evolved from 'jasm,' 19th-century American slang for 'energy'

'Grand Canyon of the Yellowstone,' a work by American painter Thomas Moran, inspired Congress to establish Yellowstone National Park.

The story of Dollree Mapp, whose legal challenge over her 1957 conviction for possessing "obscene material" led to a major strengthening of the Fourth Amendment

US housing costs have risen by roughly 175% between 1991 and 2026—but a growing number of Gen Zers are becoming homeowners anyway. In 2025, 4% of homebuyers were Gen Z, up from 3% the year before.

Long before Major League Baseball began allowing instant replay for balls and strikes, an umpire reluctantly used the technology to determine whether a hit was a home run, a move that inadvertently ushered in a new era for the sport.

View the ten deadliest tornadoes in US history.

Some coin denominations have ridges etched on their sides, partly to prevent counterfeiting, in a practice called 'reeding.'

In 1939, baseball star Lou Gehrig delivered his inspirational 'Luckiest Man' speech after retiring due to the health condition that now bears his name.

English mathematician Ada Lovelace wrote the first computer algorithm a century before computers existed and hypothesized that computing devices would one day be able to compose music—foreseeing the generative AI systems of today.

Gerrymandering works through two techniques: cracking opposing voters across districts to dilute their power, and packing them into a few to waste their votes in lopsided majorities.

The most expensive ad of all time was for Chanel No. 5 perfume and cost roughly $33M to produce in 2004—about $57M in today's dollars.

Fireworks make a loud booming sound after exploding due to air expanding faster than the speed of sound.