Supreme Court Upholds Trump-Era Tax on Overseas Investments

The Supreme Court this morning upheld by 7–2 a 2017 tax on “unrealized” income from overseas investments.

The court’s opinion in the case was written by Justice Brett Kavanaugh. Justices Neil Gorsuch and Clarence Thomas dissented from the majority opinion.

The court affirmed the Mandatory Repatriation Tax (MRT), also known as the Section 965 transition tax, which was part of the Tax Cuts and Jobs Act approved by the Republican-controlled Congress in 2017 and signed into law by President Donald Trump.

The majority found the tax does not violate the 16th Amendment to the U.S. Constitution.

Charles and Kathleen Moore, a married couple from Washington state, had argued in a lawsuit that this tax violates the Constitution’s requirement that direct federal taxes must be apportioned among the states and the Constitution’s prohibition against retroactive taxation.

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