WASHINGTON, D.C. — Independent Women’s Law Center (IWLC) yesterday filed an amicus brief in the U.S. Supreme Court in support of Kathleen and Charles Moore, taxpayers who are challenging the constitutionality of the 2017 Tax Cut and Jobs Act (TCJA). The act, passed as part of Republicans’ comprehensive international tax reform, imposes taxes on individual shareholders for corporate profits they never received because those profits were reinvested in the company.

In 2005, the Moores made a relatively small investment in an India-based company founded by a friend. The company, KisanKraft, supplies power tools to small-scale, individual Indian farmers to make their operations more productive. The Moores owned their shares in KisanKraft for more than a decade but never received any money from the company because KisanKraft reinvested all its earnings, expanding to serve farmers across India.

When the Moores received a $14,729 tax bill, they paid it but sued for a refund, arguing that the tax is unconstitutional. The lower courts rejected their claim, and the Supreme Court will now decide whether unrealized profits constitute “income” under the Sixteenth Amendment, which gave the federal government the power to levy an income tax. 

IWLC’s brief argues that the law is an unconstitutional expansion of federal power and further explains  how permitting the taxation of unrealized gains disproportionately harms women.

Jennifer C. Braceras, director of Independent Women’s Law Center, said:  “The Supreme Court has previously recognized that the scope of the Sixteenth Amendment is limited. In the decision below, the Ninth Circuit erred in disregarding that precedent and giving ‘income’ a broader definition than the term ever had or was meant to have.” 

Patrice Onwuka, director of the Center for Economic Opportunity at the Independent Women’s Forum, said: “The taxation of unrealized gains has especially harsh consequences for women not only because women tend to hold their investments for a longer term than men, but also because women are more reliant on their own capital than men to start and operate businesses.”

IWLC’s  brief in Charles G. Moore, Et Ux. v. United States can be found HERE.

Independent Women’s Law Center advocates for equal opportunity, individual liberty, and the continued legal relevance of biological sex.
Independent Women’s Forum is dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities.