It’s real, but you have to remember there were tons of exemptions, write offs and loopholes back then. It was crazy. Accountants were critical if you made any real money.
At a 92% tax rate people were investing in anything you could deduct. If the investment paid anything you were ahead. The deal was fewer deductions for lower rates. Of course we all new that eventually meant no deductions and higher rates again.
yes, you arre right. You could deduct credit card interest for example.
Exactly.
I remember my father was able to deduct a certain percentage of his income from state sales tax. It was a formula based on the percent in your state.
Also slightly before I graduated college they had adjusted average income. So new employees who made decent money got to average it against previous years when they made little. It got taken away if your filing status had been “student.” the year(s) before.
Lots and lots more that have been eliminated.
For decades, high income tax rates were ameliorated by exemptions, allowances, credits, and such. Although nominal tax rates were high, the average effective tax rate was considerably lower.