We have previously encountered Senator Nelson Aldrich in the context of the [formation of the Federal Reserve in 1913](https://www.youtube.com/watch?v=vEFlPwA8uEE):
Well, it turns out he played a pivotal role in another significant piece of legislation.
The 16th Amendment...
The 16th Amendment states that:
**"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."**
Now an income tax amendment to the Constitution was first proposed by Senator Norris Brown of Nebraska.
He submitted two proposals, Senate Resolutions Nos. 25 and 39.
However, the amendment proposal finally accepted was Senate Joint Resolution No. 40, introduced by Senator Nelson W. Aldrich of Rhode Island, the Senate majority leader and Finance Committee Chairman.
Clearly, as we have seen in the Federal Reserve story, Aldrich was a man of significance with some pretty powerful friends. The 16th Amendment became part of the Constitution on February 25, 1913. This is the same year in which the Federal Reserve Act was passed, on December 23rd 1913.
The Sixteenth Amendment exempted income taxes from the constitutional requirements regarding **direct taxes**, after income taxes on rents, dividends, and interests were considered direct taxes and ruled to be illegal.
Some would say that Federal income tax on labour has been unlawfully imposed on the American people and kept in place for over a century, contrary to various rulings by the U.S. Supreme Court.
But why? And where does the money go?
**Well, it exists such that successive federal governments can continue to pay the interest on money which, since 1913, they have been obligated to keep borrowing from central bankers, and which the government previously could print independently.**
Now of course: the Federal Reserve *is* the Independent Agency that controls the money supply. Don't just take my word for i...
As the new EU crypto law comes into effect following the implementation of ‘Fifth Anti-Money Laundering Directive’ (AMLD5), the sector will receive a much-awaited push in the region. As per the new re...
Jeff Vandroux is an attorney, CPA, bodybuilder, BTCPayServer Contributor, and the founder of Keykeeper IRA. I came to know Jeff via his discussion with Marty Bent on the Tales from the Crypt Podcast. ...