'When we got the income tax in 1913, the top rate was 7 percent. By 1980, the top rate was 70 percent.
During the Oct. 18, 2011, Republican presidential debate in Las Vegas, Rep. Michele Bachmann, R-Minn., said, 'When we got the income tax in 1913, the top rate was 7 percent. By 1980, the top rate was 70 percent.' Is she correct? We turned to the website of the Tax Foundation, which has a document that lists every tax bracket since the imposition of the federal income tax in 1913. It turns out Bachmann is right. In 1913, the federal tax code levied income taxes ranging from 1 percent to 7 percent, with the top rate of 7 percent levied on incomes of $500,000 and above (or the current equivalent of $11,332,304). At that time, there were no distinctions in filing status, such as individuals or married filing jointly. By 1980 -- just before Ronald Reagan ascended to the presidency -- the top rate was 70 percent for all filing categories. The top rate kicked in at $108,300 for individuals and $215,400 for married couples filing jointly, or $294,907 and $586,546, respectively, in today's money. For comparison's sake, the top rate today for all categories is 35 percent. And the top rate was actually higher before the 1980 level of 70 percent that Bachmann cited. For every year between1944 to 1963, the top tax rate exceeded 90 percent.
Our ruling Bachmann has accurately presented the historical tax rates for the two years she cited. We rate her statement True.