Monitoring the event of income tax law utilizing a shoebox with agricultural income

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Completing farm taxes continues to be a chore. Pixabay photo.

The closet shelves, which also held dad’s favorite candy and children’s gifts that mom thought was too good to be used during off-tax times, were searched for paper receipts.

My father’s memory and his mother’s patience were tested to document a full year of financial information. As the paperwork continued, Father counted on the day the tax system would be created in remote and non-contact Washington, DC

My parents were born before federal income tax officially became the law of the country. The first U.S. income tax was introduced to aid the Union during the Civil War, but wasn’t incorporated into law until 1913. The property tax rate (before lawmakers were asked by lobbyists to work out deductions) at this point was 1% of income up to $ 20,000 and 2% of income up to $ 50,000. The rates increased by 1% for each higher income bracket.

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Even after World War I, few farmers achieved a rise in commodity prices above the 1% income tax bracket.

Non-war federal income taxes were not introduced until 1894, and the law met with fierce opposition. In a decision that is largely forgotten, the US Supreme Court ruled in 1895 by 5-4 votes that the tax was unconstitutional.

Congress went on to rewrite the law to pass the Supreme Court draft. States soon followed federal leadership.

North Dakota first collected state income taxes in 1919, while Minnesota waited until 1933 to replenish its coffers during the Great Depression. Iowa followed a year later, while South Dakota never got around to levying a state income tax.

Minnesota went one step further than many other states in introducing a personal wealth tax. The tax officials authorized each farm to be visited to assess the value of machines, cattle, pigs, sheep and poultry. Although attempted, farmers and other payers found it difficult to hide these assets from appraisers. Because of this, reviewers were only slightly more welcome than a bad cold.

Fortunately, Minnesota personal wealth tax ended in the early 1960s when successful Republican gubernatorial candidate Harold LeVander promised to replace it with a statewide sales tax.

The 3% tax was levied on goods from 1967 and rose to 6.8% when it was last increased in 2009. North Dakota, South Dakota, and Iowa introduced statewide sales taxes in the 1930s.

Mother worked late into the night getting the numbers right. Her son – although he was good at adding and subtracting – was rarely asked for help. He could handle figuring out how much soybean meal had to be added to get the protein to the right percentage, but fell hopelessly behind in school when algebra and what was called new math were added to the equation.

When asked why it was necessary to master new math when only the old one was required, the instructor insisted that we should do it. Some of us resisted and refused to do homework.

The punishment – 500 lines of writing that said, “I’ll hand in my math homework on time – seemed less stressful than hopelessly lost in the algebra swamp. A price was later paid for my persistent refusal. A college math course was required. When the professor saw that I was hopelessly lost in it, he told me to take the army math class. Almost everyone should be able to pass it. I did, but hardly.

To avoid paying a professional preparer, I tried paying my own taxes once. Despite assurances that this would be easy, efforts failed. Mother wouldn’t have been shocked. What is amazing is that she achieved what I couldn’t despite having a shoebox system.

Mychal Wilmes is the retired editor-in-chief of Agri News. He lives in West Concord, Minnesota with his wife, Kathy.