This lawsuit could disrupt the U.S. tax system. Key facts are in dispute.

Washington Post via MSN ^ | Nov 27, 2023 | Ann Marimow, Julie Weil

[where's_the_Outrage?]

The fate of an obscure provision of President Donald Trump’s 2017 tax package, which will be reviewed by the Supreme Court next week, has many experts panicked over the potential to destabilize the nation’s tax system. In addition, some say the outcome could preemptively block Congress from creating a wealth tax.

But the case has also exposed questions about the accuracy of the personal story a Washington State couple presented to the court in making their constitutional challenge to the tax, a one-time levy on offshore earnings.

Charles and Kathleen Moore appear to have closer ties to the company central to the case than they disclosed in court filings. Among other things, Charles Moore served on its board for five years and made a significant cash contribution to the company, records show. Legal advocacy groups often rely on individuals to humanize their efforts in court, and it is not the first time that those on the other side have pointed to inconsistencies between what the justices are told in filings and the realities outside the courtroom.

Legal advocacy groups often rely on individuals to humanize their efforts in court, and it is not the first time that those on the other side have pointed to inconsistencies between what the justices are told in filings and the realities outside the courtroom.

This time, however, questions about the legal basis for the couple’s challenge to the tax have been raised before the justices are scheduled to hear oral argument on Dec. 5. Advocates who oppose their challenge have asked the Supreme Court to ditch the case and urged the couple’s attorneys, who come from an anti-regulatory advocacy group, to correct what they say are omissions and misstatements in the record.

[where's_the_Outrage?]

has many experts panicked over the potential to destabilize the nation’s tax system.

Excellent justification for ruling in favor of Moore.

Given that we have to pay income tax, the tax needs to be on realized income, not some marker of what something is worth at a given time. If later the item tanks there will not be any refund from the IRS.

[E. Pluribus Unum]

“If you strike down the mandatory repatriation tax because there’s no realization requirement, that is going to be a very powerful tool for taxpayers to challenge all sorts of laws in all sorts of contexts.”

What's the downside?

[Paladin2]

Income should be adjusted for inflation over the holding period.

[Lockbox]

The Moores argue they never earned any money from their investment and sued the federal government seeking a refund. The District Court dismissed their case, and the U.S. Court of Appeals for the 9th Circuit upheld that decision, saying the tax was within Congress’s power and permitted under the Sixteenth Amendment regardless of whether the Moores took in, or “realized,” any income.

The appeals court quoted an earlier Supreme Court opinion to say that a taxpayer is not entitled to “‘escape taxation because he did not actually receive the money.”

it appears to me that no profit was created which is the necessary requirement for income tax, while the IRS is using the “I’m the Taxman “ (The Beatles) argument .

and what type of group advocates more taxes… 🤔🤔🤔🤔🤔🤔🤔 is this another form of lawfare? Government argues in legal filings and also sends their government funded goons to champion their side also as “advocates”?

[Lockbox]

Elizabeth Warren Net Worth 2023 $73 Million

Be careful what you ask for Liz….

https://caknowledge.com/elizabeth-warren-net-worth-forbes/

[E. Pluribus Unum]

In addition, some say the outcome could preemptively block Congress from creating a wealth tax.

Wealth Tax = "I see you have some assets there. Give me some of it."

[rlmorel]

Destabilize the tax system? It is already hugely destabilized since there is no budget to guide what the tax revenues should be used for, and it has turned into an open slush fund with zero accountability.

Entities and people just stick their hands in and scoop out what they desire. Except you and me, of course. We don’t get that access.

Insanity.

[Red Badger]

Wealth Tax = “I see you have some assets there. Give me some of it.”...........”Or I’ll take ALL OF IT!”..........................

[Mouton]

You mean nice bank balance you have there. Pity something (like seizure) should happen to it.
This place should take note that a revolution against a totalitarian government mostly over taxes happened here.

[Alberta's Child]

Advocates who oppose their challenge have asked the Supreme Court to ditch the case and urged the couple’s attorneys, who come from an anti-regulatory advocacy group, to correct what they say are omissions and misstatements in the record.

Any omissions or “misstatements” by the plaintiffs in the case can be addressed by the defendants and/or through amicus briefs filed by these advocacy groups.

And I don’t even think all the facts they’ve presented here are even relevant to the case. If the case is based on the legality of taxing unrealized “income,” then it doesn’t matter of these people held any leadership positions in the foreign company.

[Jim Noble]

This lawsuit could disrupt the U.S. tax system

Bummer.

I'm very worried.

[aMorePerfectUnion]

“ An unusual political coalition has come together to defend the offshore-earnings tax, from the Biden administration to conservatives including former House Speaker Paul D. Ryan. Not because they favor a wealth tax, but because they worry a ruling against one little-known provision could undermine vast swaths of existing taxes on investments, partnerships and foreign income, which together raise billions or even trillions in revenue.

“A lot of the tax code would be unconstitutional if that thing prevailed,” Ryan said about the case at a recent Brookings Institution event. “I’m not for a wealth tax, but I think if you use this as the argument to spike a wealth tax, you’re going to basically get rid of, I don’t know, a third of the tax code.”

Ryan is against this case and for as many taxes as can be extracted.

Worth noting Ryan is supporting DeSantis.

[unixfox]

Destabilize the tax system?

It’s time to burn the son-of-a-bitch down. A flat/fair tax that is actually FAIR. But then, what would Congress do to manipulate the masses?

[Susquehanna Patriot]

What’s the downside?

For the left .... a return to a feral givernment of limited powers.

The legislators a.k.a. Supreme Court justices (Roberts, ACB, and Kave-in-naught) would never go for it.

[Susquehanna Patriot]

“...but I think if you use this as the argument to spike a wealth tax, you’re going to basically get rid of, I don’t know, a third of the tax code.” - Paul Ryno

Does Ryno have an opinion about all the taxes the FJB multimillionaires w shell companies galore ... failed to report and pay? Maybe we can make up for the lost revenue over there? We have 81,000 new agents waiting to be released.

[kvanbrunt2]

“The day after a ruling for the Moores, taxpayers and their tax advisers are going to be filing lawsuits saying various provisions of the tax code are unconstitutional, and they’re going to refuse to pay their taxes.” Thank God to be rid of the most corrupt and unlawful communist theft of wealth and a destroyer of families. The only part of the code which is constitutional (16th amendment) is a tax on income. that is source and then the derivation of gains made from that source. Wages are not income they are an exchange for time. All direct taxes on wages must be apportioned. therefor becoming a head tax. Glenshaw Glass is the case that made anything that moves an appurtenance to wealth and there fore income. Completely redefining the term income.

[Sequoyah101]

FIVE paragraphs and not yet one word of the argument or question at hand? Forget it.

[curious7]

Look up the Lloyd Long tax case in the early 90s - in TN IIRC.

[zeugma]

Income should be adjusted for inflation over the holding period.

Though I do not believe income should be taxed at all, this would help. The government causes inflation. They should not profit from it.

[Flying Circus]

“a taxpayer is not entitled to “‘escape taxation because he did not actually receive the money.”

I certainly don’t like the sound of that. It seems like a decision to hit the poor and middle class hardest. “You didn’t make any money, but we are going to tax you on what you might have made if you did.” Talk about a regressive tax, I could see that logic leading to people paying more than they could actually make.