Internal Revenue Act Law and Legal Definition
Internal Revenue Act of 1954 is a federal law that made a comprehensive revision of the federal income tax system since its origin in 1913.
The Internal Revenue Act, 1954 formally placed the income tax at the core of the federal tax system. The Act included a multitude of provisions to adjust tax burden according to ability-to-pay principle and the most obvious application of the principle is the graduated rate structure. The 1954 code fundamentally altered income tax organization and for the first time addressed many of the deficiencies that had plagued the income tax for years. It remained the standard for more than thirty years, until a new code was adopted as part of the Tax Reform Act of 1986, and many of the features introduced in 1954 survive to this day.