Sunday, March 12, 2023

Biden’s Big Wealth Tax? Unconstitutional - WSJ

What is income, exactly? That question can be trickier than it sounds, since the IRS says income includes fringe benefits, plus “the fair market value of property or services you receive in bartering.” Yet it’s relatively easier to say what income isn’t. If you own a house, or a stock, or a trendy and pricey modernist painting, it isn’t income simply when the market value rises.

In a notable 1920 case, the Supreme Court considered a stockholder who received additional shares as a dividend. “We are brought irresistibly to the conclusion,” said the majority in Eisner v. Macomber, “that neither under the Sixteenth Amendment nor otherwise has Congress power to tax without apportionment a true stock dividend made lawfully and in good faith, or the accumulated profits behind it, as income of the stockholder.”


This will send the tax scholars, to run across the fields, their robes billowing behind them. All of them will agree that it is of course income. Otherwise, it would not be taxed.

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