摩尔诉美国案

Charles and Kathleen Moore invested in KisanKraft, an American-controlled foreign corporation that generated substantial income from 2006 to 2017 but did not distribute it to shareholders. The 2017 Tax Cuts and Jobs Act imposed a one-time Mandatory Repatriation Tax (MRT) on their pro-rata share of the accumulated earnings, resulting in a $14,729 tax bill. The Moores paid the tax and sued for a refund, arguing that the MRT violated the Direct Tax Clause as an unapportioned direct tax on unrealized income. The Supreme Court affirmed the Ninth Circuit's decision in a 7-2 ruling, holding that Congress may attribute a foreign corporation's realized income to its American shareholders.

The Supreme Court affirmed the Ninth Circuit's decision, upholding the Mandatory Repatriation Tax as a constitutional exercise of Congress's taxing power. The Court held that Congress may attribute an entity's realized and undistributed income to shareholders and tax them on their portions. The ruling was narrow, limited to pass-through entities, and explicitly did not address wealth taxes or other forms of unrealized income taxation.

Whether the Sixteenth Amendment requires income to be "realized" (received or enjoyed by the taxpayer) before it can be constitutionally taxed. The Moores contended the MRT taxed unrealized gains, while the government argued no such realization requirement exists. The Court narrowly upheld the tax by applying attribution principles, avoiding the broader constitutional question.

The decision preserved the status quo of the U.S. tax code, validating Subpart F and other pass-through regimes that generate trillions in revenue. By avoiding the realization question, the Court left open the possibility of future challenges to wealth taxes and other novel tax proposals. The narrow ruling disappointed those hoping for a broad constitutional constraint on congressional taxing power, while providing limited guidance on the definition of income under the Sixteenth Amendment.