HISTORY OF TAX DAY
This year, in an unprecedented move not seen since last year’s unprecedented move, the Internal Revenue Service has extended the deadline for Federal Income Tax filing for individual tax filers. This year, instead of being due today, April 15, the new deadline for individual tax filers is April 18, but not due to the Coronavirus pandemic!
For those keeping track, and all you accountants do: The April 15th deadline for individual tax returns was extended to July 15 in 2020 and May 15 in 2021.
April 15 this year is a different holiday that supersedes Tax Day. What could delay Tax Day? The Internal Revenue Service offices in the District of Columbia (Washington, D.C.) will be closed on Friday, April 15, to observe their local Emancipation Day, when slavery was abolished in the District. It was originally signed into law by Abraham Lincoln on April 16, 1862, nine months before the national Emancipation Proclamation.
The Washington D.C. public holiday technically falls on Saturday, April 16, but is observed by the government on the closest weekday when it falls on a weekend.
Congress initially set the filing deadline in March, but it revised the Internal Revenue Code in 1954, moving the deadline to April 15, where it remains.
But wait, if you live in either Massachusetts or Maine, you get an additional day to report your taxes. Patriots’ Day is observed on the third Monday of April in these two New England States. This year that falls on April 18. Because of that holiday, residents of those states have until April 19 to file. April 18 this year is also the running of the Boston Marathon.
Beware the 15th!
It turns out that the 15th of nearly every month is a tax due date — beware the Ides!
- Partnerships are due March 15.
- Corporations and individual taxes are (usually) due April 15.
- Certain foreign taxpayers have their returns due June 15… with the extension for all of those six months later.
- Quarterly estimated taxes are due in April, June, September, and December for corporations; April, June, September, and January for individuals; and states play by their own rules and have the same due dates at the beginning of a month.
- Trusts and Nonprofits have their own dates.
The Joy of Tax Day
Tax Day is the anniversary of the celebration for the joy we feel when we receive a tax refund — until we realize it was our own money in the first place. The government has been “borrowing” it from us for the better part of a year and paying us no interest for the privilege. The holiday is celebrated with the mention of tax credits, exemptions, deductions, write-offs, and dependents… some of which may be the same.
Ancient Tax Day
Back during the time of Jesus, this season was referred to as
“render unto Caesar the things that are Caesar’s.”
…suggesting that the image (eikon) on the face of the coin indicated to whom the tax was due, in contrast to man, who is made in the image of God.
History of Tax Day
In America, the Federal Income Tax was first instituted as part of the Revenue Act of 1861 to help fund the Civil War. But it was later repealed, re-adopted, and ultimately found unconstitutional in 1895 because it violated the rule that direct taxes be apportioned among the states. However, it differed from today’s Income Tax in that back then, it was based on assessments, not voluntary tax returns.
In 1913, the 16th Amendment to the U.S. Constitution gave Congress the authority to tax all income without regard to the apportionment requirement with a filing deadline of March 1. This was changed to March 15 in 1918 and then to April 14 in 1955.
Modern Tax Day
For Tax Accountants, this is called the “busy season,” as they put in nights and weekends to finish tax returns. If they’re corporate tax accountants, they do it again in October.
Tax Day Terminology
Here are some helpful terms as you prepare your tax forms:
- Extension: get out of jail free pass for not filing by the deadline, but only for a limited time. You can file this year on October 15, but you have to pay by May 17 to avoid penalties.
- Coffee: what tax accountants convert into tax returns
- Starbucks: a place you cannot deduct as a workspace
- Dependent: not your dog
- Accrual: the kind of world it is out there
At this time, two things are inevitable: death and taxes. The latter, though, is the gift that keeps on giving.
Bill Petro, your friendly neighborhood historian