What does the 16th Amendment say?
Asked by: Prof. Yasmeen Yost PhD | Last update: January 28, 2026Score: 4.9/5 (11 votes)
The 16th Amendment to the U.S. Constitution, ratified in 1913, grants Congress the explicit power to levy and collect taxes on incomes "from whatever source derived," without needing to distribute the tax burden proportionally (apportion) among the states based on population. This amendment established the federal income tax, allowing for a graduated tax system, fundamentally changing federal revenue collection.
What is the 16th Amendment in simple terms?
The 16th Amendment (1913) simply gives Congress the power to collect income taxes from any source, without needing to divide the tax among the states based on population, making the modern, nationwide federal income tax possible. It effectively reversed a Supreme Court ruling that made such a tax unconstitutional, allowing the government to tax what people earn, not just property.
Is it unconstitutional to pay federal income tax?
Furthermore, the U.S. Supreme Court upheld the constitutionality of the income tax laws enacted subsequent to ratification of the Sixteenth Amendment in Brushaber v. Union Pacific R.R., 240 U.S. 1 (1916). Since that time, the courts have consistently upheld the constitutionality of the federal income tax.
Can you legally refuse to pay taxes?
No, you generally cannot legally choose not to pay taxes if you meet the filing requirements, as the obligation to pay is mandatory under U.S. law, but you can legally reduce your tax burden through deductions, credits, and living below the filing threshold; however, intentionally evading taxes is a crime with severe penalties, including fines and imprisonment, while making frivolous legal arguments against paying taxes is also prosecuted.
Which States rejected the 16th Amendment?
The amendment was rejected by Rhode Island, April 29, 1910; Utah, March 9, 1911; Con- necticut, June 28, 1911; and Florida, May 31, 1913. Pennsylvania and Virginia did not complete action.
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Can you opt out of paying taxes?
No, you cannot legally opt out of paying all taxes in the U.S., as it's a legal requirement, but you can reduce your tax liability through legal deductions, credits, and exemptions, or become exempt from withholding (not paying) if you meet strict IRS criteria like earning below a certain threshold or claiming an exemption on your W-4. However, intentionally evading taxes is illegal and carries severe penalties, while legal methods involve minimizing what you owe within the law, such as claiming exemptions for specific religious groups for Social Security or filing for tax-exempt status as an organization.
Is the 16th Amendment still relevant today?
The 16th Amendment is still highly relevant today as it forms the basis of the federal income tax system. Without the amendment, Congress would not have the power to levy income taxes on individuals and corporations. The federal government would have minimal power to raise revenue to fund its operations and programs.
What is the $600 rule in the IRS?
The IRS $600 rule refers to the reporting threshold for third-party payment apps (like PayPal, Venmo, Cash App) for income from goods/services, where they send Form 1099-K to you and the IRS for payments over $600 in a year. While the American Rescue Plan initially set this lower threshold for 2022 and beyond, the IRS delayed implementation, keeping the old rule ($20,000 and 200+ transactions) for 2022 and 2023, then phasing in a $5,000 threshold for 2024, before recent legislation reverted the federal threshold back to the old $20,000 and 200+ transactions for 2023 and future years (as of late 2025/early 2026), aiming to reduce confusion.
What is the IRS one time forgiveness?
The program essentially gives taxpayers who have a history of compliance a one-time pass on penalties that may have accrued due to an oversight or unforeseen circumstance, and the relief primarily applies to three types of penalties: failure-to-file, failure-to-pay, and failure-to-deposit penalties.
Can a US citizen not pay taxes?
No U.S. citizen is exempt from paying taxes if they owe them to either the federal government or to their state. Their incomes may be exempt from taxation, however, so they don't owe anything. They may be exempt from filing because they don't owe any tax due to other tax provisions.
What is the 16th Amendment for Trump?
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.
What would happen if federal income tax was abolished?
Under this estimate, we assume that if income taxes were eliminated for those making up to $150,000, taxes phased back in gradually up to $200,000 of income, and the rest of the tax code were to remain unchanged then revenue would fall by roughly $10 trillion – or 2.7 percent of GDP – over a decade.
What president started income tax?
President Abraham Lincoln started the first U.S. income tax in 1861 to fund the Civil War, but it was temporary; the modern, permanent income tax system was established under President Woodrow Wilson with the ratification of the 16th Amendment in 1913, which gave Congress the power to levy income taxes without apportionment.
Do we really have to pay federal income tax?
The tax law is found in Title 26 of the United States Code. Section 6012 of the Code makes clear that only individuals whose income falls below a specified level do not have to file returns. While our tax system is based on self-assessment and reporting, compliance with tax laws is mandatory.
What are the drawbacks of the 16th Amendment?
There have been assertions that the Sixteenth Amendment was not properly ratified, the tax law was unconstitutional, the tax law did not apply to certain types of income, the tax law only applied to certain individuals, and the tax law violated one or more constitutional rights.
What income is not taxed?
Inheritances, gifts, cash rebates, alimony payments (for divorce decrees finalized after 2018), child support payments, most healthcare benefits, welfare payments, and money that is reimbursed from qualifying adoptions are deemed nontaxable by the IRS.
What is the IRS 7 year rule?
The IRS 7-year rule generally refers to the extended time you need to keep tax records if you file a claim for a loss from worthless securities or a bad debt deduction, giving you up to 7 years from the due date of the return to claim a refund or credit for those specific issues. While the standard record retention is usually 3 years, this 7-year period ensures you have documentation for these specific, potentially complex, financial losses.
Does the IRS forgive tax debt after 10 years?
Yes, IRS debt generally goes away after 10 years from the assessment date, known as the Collection Statute Expiration Date (CSED), but this clock can pause or extend due to various actions like installment agreements, bankruptcy, or court judgments, meaning it doesn't always disappear automatically and can last longer. Key exceptions include fraud, no tax return filed, and specific extensions that stop the clock (tolling), allowing collection indefinitely in some cases.
What is the 6 year rule for the IRS?
The IRS "6-year rule" refers to two main concepts: an extended statute of limitations for assessing tax when significant income (over 25%) is omitted or related to foreign assets, giving the IRS six years instead of the usual three; and a compliance guideline that generally requires delinquent taxpayers to file the last six years of unfiled returns to be considered compliant, though exceptions exist.
How much money can you receive without reporting to the IRS?
Reporting cash payments
A person must file Form 8300 if they receive cash of more than $10,000 from the same payer or agent: In one lump sum. In two or more related payments within 24 hours. For example, a 24-hour period is 11 a.m. Tuesday to 11 a.m. Wednesday.
What is the 20k rule?
The OBBB retroactively reinstated the reporting threshold in effect prior to the passage of the American Rescue Plan Act of 2021 (ARPA) so that third party settlement organizations are not required to file Forms 1099-K unless the gross amount of reportable payment transactions to a payee exceeds $20,000 and the number ...
Will Zelle be taxed in 2025?
Does Zelle Report Payments to the IRS: Form 1099-K Details. IRS Form 1099-K reports payments received for goods or services during the tax year from credit, debit, or stored value cards and TPSOs. The 2025 reporting threshold is $2,500 or more, which will be reduced to $600 in 2026.
Can you stop paying federal taxes?
No, you cannot legally stop paying federal taxes, as it's a legal requirement, but you can reduce your liability or manage owed taxes through legal means like adjusting withholding (W-4), setting up payment plans with the IRS, offers in compromise, or potentially bankruptcy for certain older debts. The IRS imposes significant penalties for non-payment, including fines, interest, liens, and asset levies, and considers frivolous arguments against paying to be a crime.
Who opposed the 16th Amendment?
Opposition to the Sixteenth Amendment was led by establishment Republicans because of their close ties to wealthy industrialists, although not even they were uniformly opposed to the general idea of a permanent income tax.
Can you refuse to pay taxes in protest?
Federal Income Tax Laws are Voluntary A primary argument raised by protestors, for noncompliance with federal income tax laws, is that the laws are voluntary. Protestors maintain that both the filing of a federal income tax return and the payment of federal income taxes are voluntary.