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Two reasons. Before Pay As You Go (or withholding as we now know it) at the end of each year every taxpayer had to scrape together all of the taxes owed. This could be a huge sum, and not everyone was disciplined enough to save throughout the year. The second reason was World War 2. WW2 created huge problem with funding the war, and as a result war bonds were being issued and pushed to cover the gap between when the country needed the money and when it actually received it. Basic cash flow.

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Q: Why was pay-as-you-go withholding taxes needed in 1943?
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What is PAYG tax?

Although PAYG (Pay As You Go) is called a "withholding tax," it is not a tax but a procedure for withholding projected income tax liabilities as money is earned. Under that plan, the taxpayer prepays taxes in installments, usually paycheck-by-paycheck. In the U.S., prepaying federal income taxes began in 1943, when tax legislation created the first federal requirements for the payroll withholding "tax" and for estimated tax payments. The term is the common one in Australia for the employers responsibility to employees.Pay As You Go (PAYG) withholding is a legal requirement to withhold amounts for income tax purposes. If you have employees, you're required to withhold tax from payments you make to them. You may have to withhold tax from payments to other workers, such as contract workers. As a new employer, you must register with the Tax Office before you withhold from payments to your employees. You may also need to withhold an amount from payments to other businesses if they don't quote their ABN to you on an invoice or other document if required.


If you do not owe any taxes do you have to file?

Yes.Do you think the IRS should just presume that everybody who doesn't file doesn't owe any taxes?26USC6012 requires anyone having more than a certain amount of income to file a tax return. 26USC7203 makes willful failure to file a return a crime punishable by up to a year in jail and/or a $25,000 fine. Neither of these laws carry any requirement that you owe money. It is extremely rare, but people have been successfully criminally prosecuted for failure to file even though they might owe no money. See Spies v. United States, 317 U.S. 492, 496 (1943); United States v. Wade, 585 F.2d 573, 574 (5th Cir. 1978).Is the typical guy whose only source of income is a W-2 on which he had way too much tax withheld going to get prosecuted? No. Maybe if he gets arrested for something else like drugs, a tax charge might be piled onto his case. Or if he sends threatening letters to the IRS commissioner, they might take revenge. But not typically.People who have never had any income other than a W-2 forget one fact: The IRS does not know whether you owe any money until you file your taxes. A lot of people have income from other sources that does not get reported on a W-2. They owe income tax on that, too. And the IRS does not know that you have dependents or have deductions or whatever unless you file a tax return. They need that statement, sworn under penalty of perjury, of your income, deductions, exemptions, credits, and so on to properly calculate whether you owe taxes. If you don't send it to them, they will make certain worst-case assumptions about you and could even pursue you for taxes you don't owe.And if you don't file, the statute of limitations never starts running. That mean that the IRS can hound you over whether you owed taxes forever.There are also certain elections that need to be made on or before the filing date. Failure to make these elections in a timely manner means you forfeit the opportunity. For example, you can take a return of your current year IRA contribution or recharacterize a contribution up until October 15 of the next year, but only if you file your return (or an extension) on time, even if you don't owe money.Now many people will point to the fact that the civil penalty (as opposed to the rare criminal penalty) for filing late is based on the amount of money you owe. If you don't owe any money, the penalty is $0. (Note: some states impose penalties that may not be based on the amount you owe.) They then extrapolate that to mean you are not required to file and nothing will happen if you don't. These people do not know the big picture.And I don't know how many times I've seen people say "I always get a refund" but this year they don't. And they don't realize it because they haven't filled out their taxes. Or they make a mistake on their taxes and the IRS catches them. They end up paying thousands of dollars in needless failure to file penalties because they didn't file on time.


Do you have to file your taxes if you don't owe the IRS money?

Yes.Do you think the IRS should just presume that everybody who doesn't file doesn't owe any taxes?26USC6012 requires anyone having more than a certain amount of income to file a tax return. 26USC7203 makes willful failure to file a return a crime punishable by up to a year in jail and/or a $25,000 fine. Neither of these laws carry any requirement that you owe money. It is extremely rare, but people have been successfully criminally prosecuted for failure to file even though they might owe no money. See Spies v. United States, 317 U.S. 492, 496 (1943); United States v. Wade, 585 F.2d 573, 574 (5th Cir. 1978).Is the typical guy whose only source of income is a W-2 on which he had way too much tax withheld going to get prosecuted? No. Maybe if he gets arrested for something else like drugs, a tax charge might be piled onto his case. Or if he sends threatening letters to the IRS commissioner, they might take revenge. But not typically.People who have never had any income other than a W-2 forget one fact: The IRS does not know whether you owe any money until you file your taxes. A lot of people have income from other sources that does not get reported on a W-2. They owe income tax on that, too. And the IRS does not know that you have dependents or have deductions or whatever unless you file a tax return. They need that statement, sworn under penalty of perjury, of your income, deductions, exemptions, credits, and so on to properly calculate whether you owe taxes. If you don't send it to them, they will make certain worst-case assumptions about you and could even pursue you for taxes you don't owe.And if you don't file, the statute of limitations never starts running. That mean that the IRS can hound you over whether you owed taxes forever.There are also certain elections that need to be made on or before the filing date. Failure to make these elections in a timely manner means you forfeit the opportunity. For example, you can take a return of your current year IRA contribution or recharacterize a contribution up until October 15 of the next year, but only if you file your return (or an extension) on time, even if you don't owe money.Now many people will point to the fact that the civil penalty (as opposed to the rare criminal penalty) for filing late is based on the amount of money you owe. If you don't owe any money, the penalty is $0. (Note: some states impose penalties that may not be based on the amount you owe.) They then extrapolate that to mean you are not required to file and nothing will happen if you don't. These people do not know the big picture.And I don't know how many times I've seen people say "I always get a refund" but this year they don't. And they don't realize it because they haven't filled out their taxes. Or they make a mistake on their taxes and the IRS catches them. They end up paying thousands of dollars in needless failure to file penalties because they didn't file on time.


Do you have to file taxes even if you getting refund?

Yes.Do you think the IRS should just presume that everybody who doesn't file doesn't owe any taxes?26USC6012 requires anyone having more than a certain amount of income to file a tax return. 26USC7203 makes willful failure to file a return a crime punishable by up to a year in jail and/or a $25,000 fine. Neither of these laws carry any requirement that you owe money. It is extremely rare, but people have been successfully criminally prosecuted for failure to file even though they might owe no money. See Spies v. United States, 317 U.S. 492, 496 (1943); United States v. Wade, 585 F.2d 573, 574 (5th Cir. 1978).Is the typical guy whose only source of income is a W-2 on which he had way too much tax withheld going to get prosecuted? No. Maybe if he gets arrested for something else like drugs, a tax charge might be piled onto his case. Or if he sends threatening letters to the IRS commissioner, they might take revenge. But not typically.People who have never had any income other than a W-2 forget one fact: The IRS does not know whether you owe any money until you file your taxes. A lot of people have income from other sources that does not get reported on a W-2. They owe income tax on that, too. And the IRS does not know that you have dependents or have deductions or whatever unless you file a tax return. They need that statement, sworn under penalty of perjury, of your income, deductions, exemptions, credits, and so on to properly calculate whether you owe taxes. If you don't send it to them, they will make certain worst-case assumptions about you and could even pursue you for taxes you don't owe.And if you don't file, the statute of limitations never starts running. That mean that the IRS can hound you over whether you owed taxes forever.There are also certain elections that need to be made on or before the filing date. Failure to make these elections in a timely manner means you forfeit the opportunity. For example, you can take a return of your current year IRA contribution or recharacterize a contribution up until October 15 of the next year, but only if you file your return (or an extension) on time, even if you don't owe money.Now many people will point to the fact that the civil penalty (as opposed to the rare criminal penalty) for filing late is based on the amount of money you owe. If you don't owe any money, the penalty is $0. (Note: some states impose penalties that may not be based on the amount you owe.) They then extrapolate that to mean you are not required to file and nothing will happen if you don't. These people do not know the big picture.And I don't know how many times I've seen people say "I always get a refund" but this year they don't. And they don't realize it because they haven't filled out their taxes. Or they make a mistake on their taxes and the IRS catches them. They end up paying thousands of dollars in needless failure to file penalties because they didn't file on time.


When did health insurance expenses become tax deductible for businesses in the US?

It was an officially recognized practice beginning in 1943 during the War effort. Companies were finding it difficult to attract enough workers because of the limitations on wages imposed on them by the government. The companies began offering to pay health insurance expenses for their employees as a way to attract more employees since they couldn't increase their wages. In 1943 the IRS recognized this. In 1954 Congress codified this practice into the tax code. Portions of contributions that may be more more of a discussion or opinion in nature have been moved to the discussion page.

Related questions

What is PAYG tax?

Although PAYG (Pay As You Go) is called a "withholding tax," it is not a tax but a procedure for withholding projected income tax liabilities as money is earned. Under that plan, the taxpayer prepays taxes in installments, usually paycheck-by-paycheck. In the U.S., prepaying federal income taxes began in 1943, when tax legislation created the first federal requirements for the payroll withholding "tax" and for estimated tax payments. The term is the common one in Australia for the employers responsibility to employees.Pay As You Go (PAYG) withholding is a legal requirement to withhold amounts for income tax purposes. If you have employees, you're required to withhold tax from payments you make to them. You may have to withhold tax from payments to other workers, such as contract workers. As a new employer, you must register with the Tax Office before you withhold from payments to your employees. You may also need to withhold an amount from payments to other businesses if they don't quote their ABN to you on an invoice or other document if required.


Uncirculated coin 1943 with no mint mark worth?

A denomination is needed.


How much is a 1943 silver coin worth?

A denomination is needed, post new question


How much is an E Pluribus Unum 1943 coin worth?

All US coins dated 1943 have the motto E PLURIBUS UNUM more information is needed.


Why was the penny different in 1943?

Copper was needed for the war in 1943 so they used steel instead and plated it in zinc so it wouldn't wear and tarnish so quickly, giving it the silvery colour.


What is different about the 1943 pennies?

Copper was needed for the war so in 1943 pennies were made of zinc coated steel. In circulated condition they are worth 3-25 cents. In uncirculated they are worth about 10-25 dollars.


What is the nickname for 1943 pennies?

Steelies. Short for "steel cents." Copper was needed for the war, so pennies were cast out of steel.


Are any US coins made of iron?

No, but the 1943 Lincoln cent was made of steel, as copper was needed for the war effort.


What is french coin from 1943 worth?

More information is needed. Please post a new question with the coin's denomination and condition, to help ID it.


What is a 1943 Silver Wheat Penny?

The 1943 silver wheat penny is made of steel coated with zinc. During World War 2, every bit of copper was needed to make shell casings. Therefore the penny was made out of steel during 1943 so all sources of copper could be used for the shell casings.


Why did people leave Imber the forbidden place?

Because the army needed a training ground in 1943 to train for WW2. Noone ever came back.


What are the release dates for Glamour Girls of 1943 - 1943?

Glamour Girls of 1943 - 1943 was released on: USA: 2 September 1943