The federal government allows each person who files taxes to take a tax deduction called a "personal exemption." When the United States Congress created tax rules in 1954, they thought a certain amount of money should not be taxed so that a person could spend that money on food, housing, and other basic needs. In 2015, the personal exemption for one person was $4,000. Most people can take another exemption for their spouse, and another for each child in their home.