What’s the history behind the federal income tax?

The federal income tax system, as we know it today, began in 1913 — the same year the Federal Reserve was created and Federal Reserve Notes were introduced as a proprietary form of currency.

Here’s what most people don’t know:

• Before 1913, there was no federal income tax for everyday Americans.

• When the Federal Reserve Act was passed, it included Section 16.1, now codified as Title 12 U.S.C. 411, which clearly states that Federal Reserve Notes are redeemable in lawful money on demand.

• From the very beginning, it was openly disclosed that Federal Reserve Notes are the only form of taxable currency. If you accept them and fail to redeem them for lawful money, you are voluntarily opting into the income tax system.

The federal income tax was never mandatory for those who follow the proper procedure under Title 12 U.S.C. 411. Instead, it’s a voluntary service fee imposed on people who choose to use the Federal Reserve’s private currency without redeeming it as instructed.

So why does paying taxes feel like a punishment?

Because it is — you’re essentially being penalized for failing to follow your legal right and responsibility to redeem your currency as lawful money. The 12-411 process exists to restore that remedy and allow Americans to legally eliminate their federal income tax obligations.