Sixteenth Amendment to the United States ConstitutionAmendment XVI
(the Sixteenth Amendment
) of the United States Constitution
, authorizing a graduated income tax
, was ratified on February 3
. 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
Congress had previously attempted a federal income tax
which was declared unconstitutional in 1895 as a "direct tax", forbidden by Article I of the Constitution unless apportioned by population. (Such apportionment is
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 in order to make federal income taxes constitutional.
There is some dispute as to whether proper procedure was followed in the ratification of this amendment.