Income tax in the United States to file tax returns for federal and many state and local returns. Tax as determined by the taxpayer may be adjusted by the taxing jurisdiction. A tax is imposed on net taxable income in the United States by the federal, most state, and some local governments. Income tax is imposed on individuals, corporations, estates, and trusts. The definition of net taxable income for most sub-federal jurisdictions mostly follows the federal definition. The rate of tax at the federal level is graduated; that is, the tax rates on higher amounts of income are higher than on lower amounts. Some states and
Legal history of income tax in the United States (1916), the 1913 Act was ruled to be constitutional. A separate excise tax was also imposed on corporations. Subsequent legal actions were concerned with what should be counted as "income" under the 1913 Act. In "Eisner v. Macomber" (1920), the Supreme Court ruled that proportionate stock dividends were not taxable as income, on the grounds that the dividend income was not "severable" from the capital holding from which it was derived. Later decisions, however, have tended to limit this view of "severability," and to uphold the federal statutes as exertions of the power of Congress to tax. The first attempt