Amendment XVI (the Sixteenth Amendment) of the United States Constitution, authorizing income taxes in their present form, was ratified on February 3, 1913. It states:

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.

Interpretation and history

The Income Tax Act of 1894 attempted to impose a federal tax of 2% on incomes over $4,000. Derided by its opponents as "communistic", it was challenged in federal court. In the case of Pollock v. Farmers' Loan & Trust Co. (1895), the Supreme Court declared it to be an unconstitutional "direct tax", forbidden by Article I of the Constitution unless apportioned by population. Such apportionment was impractical for income taxes, since the rates would have to be set differently in different states depending on their population and total incomes. In response, this amendment was passed by Congress (and ratified by the necessary fraction of the states in 1913) in order to make federal income taxes constitutional.

In Brushaber v. Union Pacific Railroad (1916), the Supreme Court ruled that the amendment created a narrow exception, into which only taxes on income from all sources could fit. All other taxes must still pass the "direct taxes must be apportioned" test of Article I. It also ruled that the Amendment was not retroactive.

Some Americans who object to income taxes claim that the Sixteenth Amendment was never properly ratified. The best-known proponent of this claim is Bill Benson, author of the book The Law That Never Was. Federal courts have rejected appeals based on claims of non-ratification, and some now consider them "frivolous" suits that are subject to sanction.

A strong libertarian viewpoint proposes the existence of a natural right to enjoy all the fruits of one's own labor (previously protected, they claim, by the Ninth Amendment). Taxation would be an infringement on that right, and this amendment was a major expansion of the taxing power of the federal government.

External links

• National Archives: 16th Amendment (http://www.archives.gov/national_archives_experience/charters/constitution_amendments_11-27.html#16)
• "The Law That Never Was" (http://www.thelawthatneverwas.com/) — Bill Benson's website disputing its ratification
• Frauds and Scams site (http://www.fraudsandscams.com/Benson/miller.htm) describing failure of Benson-inspired arguments in court
• Brushaber Decision (http://caselaw.lp.findlaw.com/scripts/getcase.pl?navby=search&court=US&case=/us/240/1.html) Supreme Court opinion on the apportionment clause of the Constitution.
• Stanton Decision (http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=240&invol=103) no new power of taxation
• What Is Taxable Income? (http://www.taxableincome.net/report/index.html) from whatever source derived

United States Constitution

Main body

Preamble | Article I | Article II | Article III | Article IV | Article V | Article VI | Article VII

Amendments

Bill of Rights: I | II | III | IV | V | VI | VII | VIII | IX | X

Other amendments: XI | XII | XIII | XIV | XV | XVI | XVII | XVIII | XIX | XX | XXI | XXII | XXIII | XXIV | XXV | XXVI | XXVII

History of the Constitution

Federalist Papers | Proposed amendments | Signatures | Unsuccessful amendments

Interpretation of the Constitution

Congressional power of enforcement | Dormant Commerce Clause | Separation of powers | Preemption | Incorporation of the Bill of Rights

Specific clauses in the Constitution

Commerce Clause | Due Process Clause | Equal Protection Clause | Full Faith and Credit Clause | Supremacy Clause

it:Costituzione degli Stati Uniti/XVI emendamento