Constitutional and Legislative Tax Sources

Constitution and Taxes | Legislative Tax Sources

Constitutional and Legislative Sources

Civil war saw first income tax

Pollock V Farmer’s Loan and Trust ruled that income tax was illegal

Primary Sources

–          Statutory Sources

–          Constitution

–          Treaties

–          Internal Revenue Code


–          States that all taxes imposed by congress must be uniform

–          16th amendment made income tax legal

Tax Treaties

–          Eliminates double taxation

–          NAFTA

–          GATT

–          How to treat the business and investment income of visiting taxpayer

–          When a visitor is subject to a country’s tax laws

–          Prevent double taxation

–          Computation of tax in host country

–          How to withhold taxes

–          What tax must be disclosed by payer


Legislation Process

Begins in House of Reps

Changes considered by Ways and Means Committee

Sent to full House for Vote

Bill sent to Senate and referred to Finance Committee

When approved it is sent to full senate

Sent to Joint Conference Committee to resolve differences

Voted on by both houses

Signed by president

Incorporated into Revenue Code


Each committee produced committee report to explain elements for the proposals

–          Good for research


Internal Revenue Code

-since 1913


–          Subtitles (A through K)

  • Chapters (Numbers)
    • Sub-chapters (letters)
      • Parts
        • Sections
          • Subsections


Constitution and Taxes | Legislative Tax Sources

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