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What if the push for wealth taxes crashes into constitutional barriers?
In this timely Bloomberg Tax analysis, Robert Mancuso explores why a revived wealth tax could face swift legal challenges, potentially fast-tracked to the Supreme Court. Key points include:
- Wealth taxes risk classification as “direct taxes” (requiring apportionment by population under Article I)
- Taxing unrealized gains may exceed the 16th Amendment’s scope on income
- Historical context: Many countries repealed wealth taxes due to high admin costs, litigation, and low revenue
- Precedent from Moore v. United States (2024): The Court upheld a one-time tax on foreign earnings but left unrealized gains limits open
- Current proposals: Sen. Wyden’s Billionaires Income Tax Act (mark-to-market for ultra-wealthy), plus state efforts in Washington and California
- Implications: Could stifle innovation, trigger capital flight, or redefine taxpayer obligations on “potential” vs. realized wealth
This piece delivers a sharp look at the legal landmines ahead for any wealth tax revival amid rising deficits and inequality debates.
Don’t miss this must-read breakdown—before the debates heat up. Click here to read the full article and arm yourself with the facts.
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Family Enterprise USA Action engages with legislators on Capitol Hill on behalf of family offices, successful families, and family-owned businesses. It is focused exclusively on the critical tax and economic policies that impact them. Since 1995, FEUSA Action has been the leading advocacy group working daily in Washington, D.C., to reduce and eliminate estate tax, gift tax, and generation skipping transfer tax while blocking increased income and capital gains taxes, the creation of a wealth tax, and other hostile policies that punish hardworking taxpayers and success in the U.S. It is a bipartisan 501.c4 organization.
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