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Can the government impose an income tax when you never had income? That may seem like a trick question, but it’s exactly what happened to Charles and Kathleen Moore. In 2006, the Moores invested in a start‐up Indian company called KisanKraft, whose goal was to provide low‐cost, efficient tools to rural Indian farmers. The Moores believed in KisanKraft’s mission and retained their shares of KisanKraft for over a decade, never selling it for a profit. And KisanKraft reinvested all of its own profits in the company, never paying dividends. For that reason, the Moores never saw a dollar from their investment.
Yet in 2017, the Moores suddenly received a hefty federal tax bill for their ownership stake in KisanKraft. How could that be, if they never earned any money from their holdings? The reason is a provision of the 2017 Tax Cuts and Jobs Act called the Mandatory Repatriation Tax. For U.S. taxpayers who met a certain minimum threshold of ownership in certain foreign corporations, the Mandatory Repatriation Tax imposed a tax bill as if those taxpayers had earned a 2017 dividend from the corporation for profits going back years. Because the Moores owned roughly 13 percent of KisanKraft shares, they were taxed as if KisanKraft had paid them a 2017 dividend worth 13 percent of KisanKraft’s earnings since 2006. Even though that 2017 dividend was fictional, their tax bill was very real.
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But since the Sixteenth Amendment was enacted, the Supreme Court has consistently held that a tax only qualifies as an “income” tax if it is imposed on money that a taxpayer has actually “realized,” in tax law parlance. The Moores argued that since they never realized any income from their ownership stake in KisanKraft, the Mandatory Repatriation Tax cannot be an “income tax.” And there is no dispute that the Mandatory Repatriation Tax was not apportioned among the states on an equal per capita basis, so if it is not an income tax, it is unconstitutional.
But a federal district court and the Court of Appeals for the Ninth Circuit both rejected this argument, holding that the Mandatory Repatriation Tax is an income tax. Surprisingly, the Ninth Circuit explicitly held that realization of income is not a requirement for an income tax. Now the Moores have petitioned the Supreme Court to take their case, and the Cato Institute has filed an amicus brief supporting that petition.
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Absolutely. The Fed gov't. was supposed to be funded by import duties and tariffs ONLY. There would be no need for income tax. Additionally, import duties protect domestic producers of everything, so our domestic manufacturing would be completely protected from all of the cheap labor whorehouses in Asia.Go back to tariffs and eliminate income tax
We def don't need that. All that is, is an up-front sales tax. F' that. Europe can keep that BS.A flat VAT would be good
What about apportionment? That's in the Constitution and is the fairest tax of all.The Fed gov't. was supposed to be funded by import duties and tariffs ONLY.
I must have missed it. Whats was the FBI's response?IF only the law's were applied equally...
The 16th Amendment removed the apportionment requirement on direct taxes. If it didn't, everyone lible for the tax would pay the same amount. Ie: the tax would be apportioned amongst the People.The Moores argue the reparation tax is not on income and violates the 16th Amendment that requires direct federal taxes to be apportioned among the states.
And only direct taxes were to be apportioned. No other kind.Well, it's not a direct tax either, so we'll see. They are claiming a tax liability for a theoretical (unrealized) gain.
I agree. That was the real reason for the census back then. Each state had X amount of people. The total tax should be divided up among all people in the US. Each state has a share based on how many citizens are there.We def don't need that. All that is, is an up-front sales tax. F' that. Europe can keep that BS.
What about apportionment? That's in the Constitution and is the fairest tax of all.
If the People are all supposed to have equal Rights in the eyes of govt, then everyone paying an equal dollar amount is the ONLY way to go.
It's the only type of tax that can keep the govt in its britches, so to speak.
Simply put, govt and it's services need to be priced in the same manner as a gallon of milk is priced at the grocery store.
Ie: one price for all purchasers.
Eliminate much consumption, period.Go back to tariffs and eliminate income tax. A flat VAT would be good too and eliminate much of the conspicuous consumption.
It's the privilege of being able to work as a recipient of government benefit.So we all agree the income tax is not a direct tax so it obviously is an excise tax. Excise taxes can only be levied on privileged activities.
Where is the privilege of going to work?
If they allow that, it would open the door to being able to write off unrealized loses, too.To stay on topic though. Where is this company located? Is this a publicly traded company? Did they sell shares?
If the SC does it's job then they have to 1st determine if there was a profit or gain from the investment. The generally accepted version of the way it works is that you recognize that profit or gain at the time you sell your shares or stake in the investment. Until then you don't really have a profit. Can you imagine the government being allowed to collect taxes on all unrealized gains in real estate and the stock and bond markets? That would be insanity.
Per our governments Founding Documents, all of us are supposed to be equal in the eyes of gov. Which means we all have an equal liability to our government. Which means we should all be paying an equal amount in order to fund our government.I agree. That was the real reason for the census back then. Each state had X amount of people. The total tax should be divided up among all people in the US. Each state has a share based on how many citizens are there.
Earning a living is a right that can not be taxed. The courts have been clear and consistent on that. Officers of a corporation can be taxed because the corporation itself is a privilege granted by the Gov.It's the privilege of being able to work as a recipient of government benefit.
Edited to add: figure out how to make the benefit go away, and so do the taxes. lol
Problem is, most people have taken action that converted that Right into a privilege.Earning a living is a right that can not be taxed. The courts have been clear and consistent on that. Officers of a corporation can be taxed because the corporation itself is a privilege granted by the Gov.
And passed on to the end buyer as a POS tax of different name. All of it is f'ed up. If gov needs money, the taxes levied should be on the People themselves AND be apportioned. It's the only way to keep gov small and focused only on the most important stuff.I have no real issue with a POS tax on purchases; but a VAT tax is bad news. Items taxed all up and down the process.
Only a federal corporation.Earning a living is a right that can not be taxed. The courts have been clear and consistent on that. Officers of a corporation can be taxed because the corporation itself is a privilege granted by the Gov.
And that's what they treat you as.Only a federal corporation.
I know a lawyer in Boulder CO.
I hope SCOTUS takes up this case. I wonder if the case might shed light on the proper tax treatment for crypto staking rewards. Crypto staking rewards are earned as the underlying crypto and aren't realized as profit/income unless the crypto is sold. At least, that's how I see it.
In Moore v. United States, the Supreme Court will decide this year whether the Ninth Circuit was right in upholding as constitutional taxes on unrealized capital gains and wealth taxes. Ed Meese, Gary Lawson, and I have written an amicus brief filed by Philip Williamson urging the Supreme Court to overrule the Ninth Circuit on both points. Our brief presents the original public meaning of the Sixteenth Amendment and of the requirement that direct taxes be apportioned among the States. We urge the Supreme Court to ignore bad caselaw and to stick to the original public meaning of the constitutional text.
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The Ninth Circuit took a different, unprecedented view. The court of appeals concluded that realization is not a precondition for income, and so the Moores could be taxed on unrealized gains in wealth. That rationale is not limited to the Moores, or to the particular tax, which the court applied in their case. Rather, under the Ninth Circuit's analysis, investors might be taxed on their unrealized capital gains in their Vanguard funds or their stock portfolios. Moreover, homeowners might be taxed on their unrealized capital gains in their houses and land. The Ninth Circuit is the only federal court of appeals to so hold. The Supreme Court should reverse the Ninth Circuit and restore the original, commonsense meaning of the Sixteenth Amendment.
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Yep, because finding creative ways to defeat its Constitutional limits is what our gov does best.Unfortunately, just because something is unconstitutional doesn't mean it won't happen
A key issue in Moore v. United States is whether income has to be realized to be taxable. An amicus brief in the case was filed by Professors of linguistics who did a 1913 search of the use of the words "income" and "derived" from the Sixteenth Amendment and found that overwhelmingly Americans thought income has to be realized to be taxable. ...
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The United States should lose this case. Income literally has to "come in" before it is taxable both as the word was used in 1913 and based on its etymology.
First, the government and the Wall Street Journal are trying to persuade the Supreme Court to decide this case extremely narrowly after very publicly calling into question the ownership by private homeowners and stockholders of the unrealized gains on their assets thus limiting the ability of owners to borrow against those gains. This is completely unfair because word that this case was pending in the Supreme Court caused those assets to be less highly valued than would otherwise be the case. Justice should be done to all the millions of homeowners and owners of small amounts of stock who never knew that the federal government claimed a power to tax unrealized capital gains or to impose a direct wealth tax. The Supreme Court owes 330,000,000 Americans a clear affirmation of their right not to have unrealized capital gains or wealth directly taxed.
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What, you don't think Treasury could just print/digitize a flood of new fiat?If we could just get back to US Notes we could eliminate all this falderal...
They could, BUT it won't be at interest! That is the difference between the private Federal Reserve note and US Notes.What, you don't think Treasury could just print/digitize a flood of new fiat?
Wait until the MMT idiots convince Ma Yellin to mint a handful of Trillion-Dollar platinum coins, to be deposited in the "Treasury" as backing for whatever kind of paper, digital, or crypto money they're eager to flood their supporters with.
With many hands, a check. To print like drunken DemocRats, they need the cooperation of the Fed chair, and the banksters...AND it costs, as you say.They could, BUT it won't be at interest! That is the difference between the private Federal Reserve note and US Notes.
That's what JFK attempted to do backed by the National strategic silver stockpile (80M oz?).
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