Passed by Congress May 13, 1912, and ratified April 8, 1913, the 17th amendment modified Article I, section 3, of the Constitution by allowing voters to cast direct votes for U.S. Senators. Prior to its passage, Senators were chosen by state legislatures. Each state legislature would elect two senators to 6-year terms.

The Seventeenth Amendment (Amendment XVII) to the United States Constitution established the direct election of United States senators in each state. The amendment supersedes Article I, §3, Clauses 1 and 2 of the Constitution, under which senators were elected by state legislatures.

Senator William Borah of Idaho, himself a product of a state-based system of direct election, strongly supported the measure. In fact, by 1912, as many as 29 states elected U.S. senators either as nominees of their party’s primary or in a general election.

According to Article I, Section 3 of the Constitution, “The Senate of the United States shall be composed of two Senators from each state, chosen by the legislature thereof for six Years.” The framers believed that in electing senators, state legislatures would cement their ties with the national government.

The rise of the People’s Party, commonly referred to as the Populist Party, added motivation for making the Senate more directly accountable to the people. During the 1890s, the House of Representatives passed several resolutions proposing a constitutional amendment for the direct election of senators.

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The constitutional transformation began with the 16th Amendment, which allowed Congress to institute a real income tax for the first time, and the 17th Amendment, which provided for direct election of senators. These two changes gave the federal government a more national character and fueled its vast expansion.

The 16th Amendment allows for the collection on income taxes for all citizens by the federal government. The 17th Amendment states that the Senators must be elected by majority vote.

Those who don’t pay often face civil penalties. When Americans fail to pay their federal income taxes without “reasonable cause,” they may be charged a late penalty of 0.5% of the taxes owed for every month or part of the month the tax remains unpaid, up to 25% of the total amount, according to the IRS.

If you want to avoid paying taxes, you’ll need to make your tax deductions equal to or greater than your income. For example, using the case where the IRS interactive tax assistant calculated a standard tax deduction of $24,400 if you and your spouse earned $24,000 that tax year, you will pay nothing in taxes.

These tips can help you reduce taxes on your income

1. Invest in Municipal Bonds.
2. Take Long-Term Capital Gains.
3. Start a Business.
4. Max Out Retirement Accounts and Employee Benefits.
5. Use an HSA.
6. Claim Tax Credits.
7. The Bottom Line.

Most of the income that billionaire investors report on their taxes is “unearned” — namely dividends (when they own shares in a company that gives a portion of its profits to shareholders) and capital gains (when they sell an asset for more than they paid for it). For long-term capital gains, it can be as low as zero.

The richest 1% pay an effective federal income tax rate of 24.7%. That is a little more than the 19.3% rate paid by someone making an average of $75,000. And 1 out of 5 millionaires pays a lower rate than someone making $50,000 to $100,000.

The rich generally pay more of their incomes in taxes than the rest of us. The top fifth of households got 54% of all income and paid 69% of federal taxes; the top 1% got 16% of the income and paid 25% of all federal taxes, according to the CBO.

The top 1 percent paid a greater share of individual income taxes (38.5 percent) than the bottom 90 percent combined (29.9 percent). The top 1 percent of taxpayers paid a 26.8 percent average individual income tax rate, which is more than six times higher than taxpayers in the bottom 50 percent (4.0 percent).

According to their research, they concluded that in 2018, the top 0.1% — the billionaires of America — paid an average effective tax rate of 23%, which factors in all federal, state and local taxes. The bottom 50% of U.S. households, however, paid a higher rate of 24.2% toward income tax.

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Living in the world’s lowest income tax countries

• United Arab Emirates. Income tax: 0% Price of a can of Coke: US$0.83.
• Western Sahara. Tax rate: 0%
• Bermuda. Tax rate: 0%
• Somalia. Tax rate: 0%
• The Bahamas. Income tax: 0%
• Monaco. Tax rate: 0%
• Andorra. Tax rate: 10%
• Belize. Tax rate: 25%

All foreigners officially residing in Monaco and people with the Monegasque nationality can benefit from this zero personal income tax regime. The Principality of Monaco doesn’t levy capital gains tax nor wealth tax. Inheritance tax and gift tax are payable, but only with regard to assets situated in Monaco.