Revenue Act of 1940

The Revenue Act of 1940 temporarily and permanently increased individual income tax rates, temporarily and permanently increased corporate tax rates (top rate rose from 19% to 33%), and temporarily increased most excise tax rates to 30-50%.

The personal exemption fell from $2,500 to $2,000 (married couples).

Tax on corporations

Normal tax

A Normal Tax was levied on the net income of corporations as shown in the following table.

Revenue Act of 1940 Tax on Corporations 53 Stat. 863 [1]
Net Income (dollars)	Rate (percent)
0	19
25,000	33

Tax on individuals

A normal tax and a surtax were levied against the net income of individuals as shown in the following table.

Revenue Act of 1940 Normal Tax and Surtax on Individuals 53 Stat. 5 [2]
Net Income (dollars)	Normal Rate (percent)	Surtax Rate (percent)	Combined Rate (percent)
0	4	0	4
4,000	4	4	8
6,000	4	6	10
8,000	4	8	12
10,000	4	10	14
12,000	4	12	16
14,000	4	15	19
16,000	4	18	22
18,000	4	21	25
20,000	4	24	28
22,000	4	27	31
26,000	4	30	34
32,000	4	33	37
38,000	4	36	40
44,000	4	40	44
50,000	4	44	48
60,000	4	47	51
70,000	4	50	54
80,000	4	53	57
90,000	4	56	60
100,000	4	58	62
150,000	4	60	64
200,000	4	62	66
250,000	4	64	68
300,000	4	66	70
400,000	4	68	72
500,000	4	70	74
750,000	4	72	76
1,000,000	4	73	77
2,000,000	4	74	78
5,000,000	4	75	79

• Exemption of $800 for single filers and $2,000 for married couples and heads of family. A $400 exemption for each dependent under 18.

References

1. Facsimile
2. Facsimile