Moore v. United States (2024)

Moore v. United States
Supreme Court of the United States
Argued December 5, 2023 Decided June 20, 2024
Full case name	Charles G. Moore, et ux. v. United States
Docket no.	22-800
Argument	Oral argument
Questions presented
Whether the Sixteenth Amendment authorizes Congress to tax unrealized sums without apportionment among the states.
Holding
The Mandatory Repatriation Tax (MRT) does not exceed Congress’s constitutional authority.
Court membership
Chief Justice John Roberts Associate Justices Clarence Thomas · Samuel Alito Sonia Sotomayor · Elena Kagan Neil Gorsuch · Brett Kavanaugh Amy Coney Barrett · Ketanji Brown Jackson
Case opinions
Majority	Kavanaugh, joined by Roberts, Sotomayor, Kagan, Jackson
Concurrence	Jackson
Concurrence	Barrett (in judgment), joined by Alito
Dissent	Thomas, joined by Gorsuch

Moore v. United States (Docket 22–800) was a United States Supreme Court case related to the ability of the federal government to tax unrealized gains as income. The Supreme Court upheld the Mandatory Repatriation Tax (MRT).

Background

Charles and Kathleen Moore invested $40,000 in an Indian business named KisanKraft in 2005, in exchange for 11% of the company's equity. KisanKraft is a controlled foreign corporation. The company has made a profit every year of its existence, and rather than distributing its earnings to shareholders, it has reinvested profits in the business. Prior to the passage of the Tax Cuts and Jobs Act in 2017, income tax on such earnings generally did not have to be paid until they were distributed to shareholders. The 2017 law changed the corporate and Subpart F tax regime to focus on domestic profits, and imposed a one-time mandatory repatriation tax on profits held overseas. The Moores paid the $14,729 in tax owed and challenged the law in the United States District Court for the Western District of Washington as violating the Sixteenth Amendment's requirement that income be realized before it can be taxed, as set forth in Eisner v. Macomber (1920).

The district court ruled for the government, and the United States Court of Appeals for the Ninth Circuit affirmed. An appeal to rehear the case en banc was denied.

Supreme Court

The Moores appealed the Ninth Circuit decision to the Supreme Court on February 21, 2023. The Supreme Court granted certiorari on June 26, 2023.

In the summer of 2023, Justice Samuel Alito was interviewed for The Wall Street Journal by David B. Rivkin, an attorney in this case. After publication, Senator Dick Durbin wrote to Chief Justice John Roberts, expressing his opinion that the court should "take appropriate steps" to ensure Alito's recusal from this case. In an order list released on September 8, 2023, Alito rejected Durbin's accusation that his verdict would be swayed by his contact with Rivkin, and he refused to recuse himself.

Oral argument before the Supreme Court took place on December 5, 2023. The ruling was handed down on June 20, 2024.

Ruling

Justice Kavanaugh, writing for the majority, ruled that the tax fell within the authority of Congress under the Constitution. Kavanaugh was joined by Chief Justice Roberts and Justices Kagan, Sotomayor, and Jackson. Justice Barrett wrote a concurring opinion, joined by Justice Alito. Justice Thomas dissented, joined by Justice Gorsuch.

External links

• Text of Moore v. United States, 601 U.S. ___ (2024) is available from: Oyez (oral argument audio)