The Supreme Court announced on Monday that it will take it into account

on

the constitutionality of wealth taxes by deciding whether Congress may require taxpayers to pay their share of a foreign company’s earnings, even if they received no dividends or income.

The case of Charles and Kathleen Moore and their $14,729 tax bill received a lot of attention on the right because of what it could mean if progressive Democrats take control of Congress.

The 16th Amendment says that Congress has the authority to “impose and collect taxes on income from any source.” And that includes that the government may impose

taxes

on wages or earnings and stock dividends, but not on real estate or business assets that are growing in value. These are called “unrealized gains”.

But last year, the 9th Circuit Court upheld part of the 2017 tax bill passed by the Republican-controlled Congress that imposed a one-time tax on Americans who owned stock in foreign companies that increased in value.

The Moores said they received no income or dividends from their investment in a company in India that supplies equipment to small farmers, and they sued, claiming the tax was unconstitutional. They lost in a federal judge and an appeals court.

“There is no general constitutional prohibition on Congress overriding the corporate form to facilitate taxation of shareholder income,” the appeals court said. “In other words, there is no constitutional prohibition prohibiting Congress from apportioning a company’s income to shareholders on a pro rata basis.”

But attorneys for the Moores, backed by the U.S. Chamber of Commerce and other business groups, urged the Supreme Court to hear the appeal.

They said the 9th Circuit’s opinion “removed the Constitution’s key limit on federal taxing powers” by sweeping away Congress’s essential limitation on taxing powers and opening the door to undistributed taxes on property and everything the other that Congress would consider income.

“The Constitution doesn’t allow Congress to point to a pot of money and name the income and then tax it on income,” said Andrew M. Grossman, Moores’ lead attorney. Income now means the same thing it did when the 16th Amendment was introduced. ratified: profits realized by the taxpayer.”

The Supreme Court will hear Moore v. treat United States.