Moore v. United States

In Moore v. United States, decided on June 20, 2024, the U.S. Supreme Court upheld the mandatory repatriation tax enacted under the Tax Cuts and Jobs Act of 2017. Charles and Kathleen Moore challenged the one-time tax on their share of accumulated earnings in a foreign corporation, arguing that the Sixteenth Amendment only permits taxation of realized income. The Court rejected that argument, holding that the tax fell within Congress's broad taxing power. The decision affirmed the Ninth Circuit and resolved a major constitutional question regarding taxation of unrealized gains.

The Supreme Court affirmed the Ninth Circuit in a 7-2 decision, holding that the mandatory repatriation tax is constitutional. Justice Kavanaugh wrote the majority opinion, Justice Barrett concurred, and Justice Thomas dissented, joined by Justice Gorsuch.

Whether the Sixteenth Amendment requires income to be realized before Congress may tax it, and whether the mandatory repatriation tax is an unconstitutional direct tax that must be apportioned among the states.

The ruling affirmed broad congressional power to tax certain unrealized income, leaving the door open for future federal wealth tax proposals. It was closely watched by tax law experts and policymakers as a major precedent on the scope of federal taxing authority.