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Random Facts - The world's largest financial institution is out to get you.
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Wednesday, April 20, 2016
The Internal Revenue Service (IRS) is the world's largest financial institution which wields tremendous power. In May 2015 it was revealed that the IRS had targeted conservative nonprofit groups for increased scrutiny surrounding their tax behavior during President Barrack Obama's first term. However, President Obama did not condone the acts and was outraged by the report.
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Today's Random Fact:
Franklin Roosevelt used the IRS to harass newspaper publishers who were opposed to his plans for the New Deal. The former president also used the IRS on political rivals and prominent Republicans, including an IRS audit of illegal campaign contributions made by a government contractor to congressman and future president Lyndon B. Johnson.
During his presidency, Richard Nixon encouraged a secret IRS program called the Special Services Staff, which investigated his political opponents as well as harassing them with audits. More than 10,000 individuals and groups were targeted between 1969 and 1973.
Previous to 1862, the government only collected sales tax on certain items such as alcohol and tobacco. President Lincoln created the IRS and enacted a 3 percent income tax on those who made between $600 and $10,000 to assist in covering Civil War costs. This would be repealed 10 years later.
The income tax system employed by the IRS that we know today would not be put into place until 1913 with the addition of the 16th amendment to the U.S. Constitution, which reads, "Congress shall have power to lay and collect taxes on incomes, from whatever source derived..."
When the income tax was fully established in 1913, the tax rate was 1 percent. Few paid income tax to the IRS, as it was required only if you made $3,000 or more per year. That year only 1 out of 271 Americans had to pay income tax.
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