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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- Historical context: Many countries repealed wealth taxes due to high admin costs, litigation, and low revenue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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The need for fact-based reporting of issues important to family owned businesses and protecting a lifetime of savings has never been greater. Now more than ever, successful families and family owned businesses are under fire. That's why Family Enterprise USA is passionately working to increase the awareness of issues important to family owned businesses built on hard work, while continuing to strengthen our presence on Capitol Hill. The issues we fight for or against with Congress in Washington DC include high income tax rates, possible elimination of valuation discounts, increase in capital gains tax, enactment of a wealth tax, and the continued burden of the gift tax, estate tax and generation skipping tax.
Family Enterprise USA promotes generationally owned family business creation, growth, viability, and sustainability by advocating for family businesses and their lifetime of savings with Congress in Washington DC. Since 2007, Family Enterprise USA has represented and celebrated all sizes, professions and industries of family-owned enterprises and multi-generational employers. It is a bi-partisan 501.c3 organization. Family foundations can donate.
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