The withholding system of payroll deductions was another wartime development.
To help pay for the war, the government increased corporate and personal income taxes. The federal income tax entered the lives of many Americans. In 1939 fewer than 8 million people filed individual income tax returns. In 1945 nearly 50 million filed. The withholding system of payroll deductions was another wartime development. The government also borrowed money by selling "war bonds" to the public. With consumer goods in short supply, Americans put much of their money into bonds and savings accounts.