Revenue Act of 1942

The United States Revenue Act of 1942, Pub. L. 753, Ch. 619, 56 Stat. 798 (Oct. 21, 1942), increased individual income tax rates, increased corporate tax rates (top rate rose from 31% to 40%), and reduced the personal exemption amount from $1,500 to $1,200 (married couples). The exemption amount for each dependent was reduced from $400 to $350.

A 5% Victory tax on all individual incomes over $624 was created, with postwar credit.

The 35-60% graduated rate schedule for excess profits tax was replaced with a flat 90% rate.

The Act also created deductions for medical expenses.^[1]

Expenses for the production of income

Section 121 of the Revenue Act of 1942 enacted section 23(a)(2) of the Internal Revenue Code of 1939. That provision, effective retroactively for tax years that began after December 31, 1938, allowed a deduction, for U.S. federal income tax purposes, for expenses incurred in investment activities (activities for the production of income), even if such activities are not conducted in connection with a trade or business.^[2] The current version of section 23(a)(2) in section 212 of the Internal Revenue Code of 1986.

Tax on corporations

Normal tax

A normal tax was levied on the net income of corporations as shown in the following table:

Revenue Act of 1942 Normal Tax on Corporations 56 Stat. 805 ^[3]
Net Income (dollars)	Rate (percent)
0	24
25,000	31

Surtax on corporations

A surtax was levied on the corporation surtax net income (net income less allowances and exemptions) of corporations as shown in the following table:

Revenue Act of 1942 Surtax on Corporations 56 Stat. 806 ^[4]
Corporation Surtax Net Income (dollars)	Rate (percent)
0	10
25,000	22
50,000	16

Tax on individuals

A normal tax and a surtax were levied against the net income of individuals as shown in the following table:

Revenue Act of 1942 Normal Tax and Surtax on Individuals 56 Stat. 802 ^[5]
Net Income (dollars)	Normal Rate (percent)	Surtax Rate (percent)	Combined Rate (percent)
0	6	13	19
2,000	6	16	22
4,000	6	20	26
6,000	6	24	30
8,000	6	28	34
10,000	6	32	38
12,000	6	36	42
14,000	6	40	46
16,000	6	43	49
18,000	6	46	52
20,000	6	49	55
22,000	6	52	58
26,000	6	55	61
32,000	6	58	64
38,000	6	61	67
44,000	6	63	69
50,000	6	66	72
60,000	6	69	75
70,000	6	72	79
80,000	6	75	82
90,000	6	77	84
100,000	6	79	85
150,000	6	81	87
200,000	6	82	88

There was an exemption of $500 for single filers, $1,200 for married couples and heads of family, and $350 for each dependent under 18.

Notes

↑ "Historical Highlights of the IRS," Internal Revenue Service, U.S. Dep't of the Treasury, at .
↑ See generally Bingham's Trust v. Commissioner, 325 U.S. 365, 65 S. Ct. 1232, 45-2 U.S. Tax Cas. (CCH) paragr. 9327 (1945).
↑ Facsimile
↑ Facsimile
↑ Facsimile

Tax Acts of the United States

Internal Revenue	1861 1862 1864 1913 1916 1917 1918 1921 1924 1926 1928 1932 1934 1935 1936 1940 1940 (2nd) 1941 1942 1943 1943 1944 1945 1948 1950 1950 1951 1954 1954 Code 1962 1964 1968 1969 1971 1975 1976 1977 1978 1981 1982 Gas Tax 1984 COBRA 1986 1986 Code 1990 1993 1996 1997 1998 2001 2002 2003 2004 2005 2006 2008 Crisis 2009 2010 2012

Tariffs	1789: Hamilton I 1790: Hamilton II 1792: Hamilton III 1816: Dallas 1824: Sectional 1828: "Abominations" 1832 1833: Compromise 1842: Black 1846: Walker 1857 1861: Morrill 1872 1875 1883: Mongrel 1890: McKinley 1894: Wilson–Gorman 1897: Dingley 1909: Payne–Aldrich 1913: Underwood 1921: Emergency 1922: Fordney–McCumber 1930: Smoot–Hawley 1934: Reciprocal 1948: GATT 1962 1974/75 1979 1984 1988 1988: Canada FT 1993: NAFTA 1994: WTO 2002: Steel

Social Security (United States)

Key articles	History of Social Security Social Security Administration Social Security number

Assistance programs	Disability Determination Services Retirement Insurance Benefits Social Security Disability Insurance Supplemental Security Income Temporary Assistance for Needy Families Ticket to Work Unemployment benefits

Health care	Medicaid Medicare SCHIP

Law	Disability fraud FICA Revenue Act of 1942 Social Security Act Social Security Amendments of 1965 Social Security Death Index Social Security Trust Fund Windfall Elimination Provision

Other	Legacy debt Numident Office of the Chief Actuary Primary Insurance Amount Social Security debate (United States) Social Security Wage Base Years of coverage

This article is issued from Wikipedia - version of the 12/29/2015. The text is available under the Creative Commons Attribution/Share Alike but additional terms may apply for the media files.