If they adopt a wealth tax, we’ll be taxed on everything we own, every year, whether we sell it or keep it. This would mean that everything we own that goes up, even if it goes up because of inflation, is taxable income. OMG.
OMG is right.
From article:
"…the court’s new ethics code says, “A Justice should not be swayed by partisan interests, public clamor, or fear of criticism.”
I mean, the conservatives would say something along the lines of, Well, our job is not to figure out the fallout from Congress writing an unconstitutional rule. Our job is just to determine whether it’s unconstitutional."
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The government isn’t arguing anything in front of the Supreme Court to allow a proposed law. That isn’t how the courts work.
The plaintiffs in this case are challenging a provision in the 2017 tax code that taxes unrealized income from foreign investments. The tax was to offset the revenue lost from the big corporate tax breaks.
Like it or not, the 16th amendment is clear, “*Congress shall have power to lay and collect taxes on incomes”. A wealth tax would be unconstitutional.
I listened to government attorneys argue that unrealized gains are income. I listened all day to them. Here: https://www.youtube.com/watch?v=bvz4SqdJh7E
It is all very complicated. The government has long been forced to make decisions about when to tax “income” and also to decide “what is income?” There is a very good, short, easy read explainer linked to in the article Nick posted at the top. I’ll link it directly here. This short article helps put it in perspective.
Unrealized gains (especially due to inflation) is NOT income. If that were true, you’d have to earn income, pay tax on that income, then take what is left after taxes to pay the tax on the unrealized gains. That would be insane.
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(Unrealized— the paper profits on assets like stocks and bonds that the owner hasn’t yet sold.)
Exactly…
They already tax unrealized gains. When your property value goes up (reassessed) so do your property taxes. I’ve gotten two escrow adjustments in the last year due to property tax increases.
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Agreed 100%. Income is cash in hand that goes in your pocket after all is said and done. Taxing unrealized gains really isn’t much different than a VAT. Bunch of crap it is…
Excellent point Bob. I threw in an extra $1K in February to cover the inevitable “shortfall” letter from the bank, and wouldn’t you know it, the escrow portion of my mortgage payment went up anyway… 
My property taxes went up $1k this year, and will most likely go up again next year by a crap ton.
Oh yeah, and how does our crooked governor try to fix the property tax issue here? By attempting to dissolve TABOR (Taxpayer’s Bill Of Rights). In CO, any overage the state has collected in the form of taxes, must be refunded to the people. We get a check almost every year. Sometimes it’s not very much at all, other years it can be a few hundred bucks. Career politicians seem to think that the peoples money belongs to them, to line their own pockets with and blow on some of the stupidest crap on the planet. They will never stop trying to get it either…
Had idiot voters not repealed the Gallager amendment here in CO, this nonsense would not have happened…
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Don’t let this thread fool you into thinking it’s that simple. Pres. Trump signed the challenged legislation into law in 2017. It was meant to close some loopholes where the very rich were positioning gains overseas to avoid taxation. The lawsuit itself has nothing to do with a wealth tax, but the ruling could impact the constitutionality and legality of a wealth tax indirectly (if one were to ever be passed by Congress, which is extremely unlikely).
Do some research and look at who is funding this lawsuit on the Plaintiff’s behalf.
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Wow, glad I don’t live out there…bummer, Michael.
Why did property tax go up in Colorado?
“**In the latest tax assessments this year, residential property values increased by between 35% and 45% in the Denver area and up to 60% in parts of the mountains. So homeowners were still set to get bigger property tax bills for this year compared to last year. **The ballot measure would have just eased the increase.Nov 7, 2023”
Is this in reference to Proposition HH?? That was a bogus statement made by our governor that was proven to be an out and out lie, and was used to sell the measure to the people.
In 2020 Amendment B was put on the ballot to repeal the Gallagher amendment. The Gallagher amendment was a form of checks and balances regarding property tax increases. Since it is now gone and for the most part forgotten, county assessors use values based on the real estate market, which is rediculously over inflated right now. Hence the higher taxes. It’s more or less a loop hole to increasing taxes w/o taxpayer approval as required by the state’s constitution.
Just off the AP website:
Colorado voters reject measure that would have lowered property tax bills | AP News.
Property tax in my county is going up on average 37%, and the city I live in is going up the highest in the county, to 41%, this is based on the housing values of last year, the year of the crazy market.
Unfortunately, I think a lot of people, especially the elderly, many of whom are on fixed incomes, will be unable to afford it and will have to sell.
But fact of the matter is, this is a state tax, not federal.
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I think people often believe a rising property value automatically means paying more property tax. The property value, at least in my area, is used to determine your share of the tax levy, not to determine the total amount of tax collected.
The total amount of tax collected is determined by your local elected officials when they set their budgets. Your share will be higher or lower depending on the value, classification, and sometimes other factors of your property.
In other words, even if your value remained flat, your share of the levy will likely increase as the levy increases.
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Why do you think it is unlikely?
From what I have read about it, the obstacles are immense. From constitutionality, to precedent, to the enormous administrative burden and challenges, it likely isn’t worth it. Besides a few, it seems most lawmakers who look into it quickly dismiss it.
The market value is out of wack, for sure.
Ours can go up equal to inflation or 5% whichever is less.
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Obama singed into law in 2010 the Foreign Account Tax Compliance Act (FATCA) which according to the IRS " generally requires that foreign financial Institutions and certain other non-financial foreign entities report on the foreign assets held by their U.S. account holders or be subject to withholding on withholdable payments." So as far as trying to go after funds that are being stashed overseas, that has been around for some time and is nothing new… Foreign Account Tax Compliance Act (FATCA) | Internal Revenue Service (irs.gov)
From what I have read on this Moore vs US case, they are being charged taxes on funds that have not been “realized” or paid directly to them yet. The premise for their argument is based on a SCOTUS ruling from a case in 1920 (from the link you posted) Mcomber vs Eisner If they haven’t received the money then it is “unrealized” hence my statement
Once it is “realized” it then becomes income. Taxing “unrealized” money is no different than taxing somethings perceived value which was also addressed by the SCOTUS in 1940 Helvering v. Horst case as explained here
" This rule, the Supreme Court explained in Helvering v. Horst (1940), is “founded on administrative convenience.” It is often difficult to determine how much an asset is actually worth until the asset is sold, especially if that asset is anything other than stock in a publicly traded company. So the requirement that profits ordinarily must be realized before they are taxed prevents a situation where an investor cannot figure out how much they owe in taxes, because they don’t know the specific value of all their assets.
Additionally, the realization requirement helps prevent a situation where a taxpayer owes a significant amount of taxes on assets they cannot easily sell, and doesn’t have any other source of cash they can use to pay the taxes."
This is pretty much what a VAT (Value Added Tax) is all about. Taxing something based on it’s perceived value and not it’s actual value. The actual value can only truly be figured out once the item in question (in this case, owed money) has changed hands. Usually you only hear about VATs when it is associated with consumer goods, but the same principal can be applied to unrealized funds/assets.
So you are in the same boat as I am. 
The sad thing is that when, not if, but when the real estate market crashes again, those market values will plunge, but the taxes won’t.
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