Connect with us

Business

Supreme Court to consider ‘quadrillion-dollar question’ in major tax case on November 28, 2023 at 11:00 am Business News | The Hill

Published

on

The Supreme Court will hear oral arguments in early December on a case that has the potential to broadly reshape the U.S. tax code and cost the government hundreds of billions of dollars in revenue.

At issue in Moore v. United States is the question of whether the federal government can tax certain types of “unrealized” gains, which are property like stocks or bonds that people own but from which they haven’t directly recouped the value, so they don’t have direct access to the money that the property is worth.

Large portions of the U.S. tax code require that income be “realized” before it can be taxed, but critics say it’s an inherently wishy-washy concept that courts have just been ignoring for years due to administrative impracticalities. 

Even if the court limits the scope of its decision to the specific tax referenced in the case, known as the mandatory repatriation tax, a ruling in favor of the plaintiffs could cost $340 billion over the next decade, according to the Justice Department.

Advertisement

Tax issue: $1 trillion in unpaid corporate taxes sparks UN tussle

For comparison, that would cancel out all the extra revenue generated by the $80 billion IRS funding boost and then add an additional $140 billion to the national deficit, which now stands between $26 and $33 trillion, according to various measurements.

But experts say the cost could be much higher than that if the court broadens out its definition of what counts as realization, pushing heaps of taxable income out of the government’s reach.

The decision could have implications for everything from potential wealth taxes, like the one the Biden administration proposed for billionaires in 2022, to large swaths of the international tax regime.

Advertisement

The U.S. solicitor general herself is scheduled to argue the case before the justices, underscoring how the Biden administration views its importance.

“It’s the million-dollar question, just with a few more zeros: the quadrillion-dollar question,” Harvard University tax law professor Thomas Brennan told The Hill.

“On one extreme, if the Supreme Court decides that a realization requirement is present in the 16th Amendment … then there are a number of code sections that arguably would be invalid or have to be reworked,” he said.

These sections could involve partnership tax rules, rules on the taxation of debt and commodities, taxes on futures contracts and the international tax rules that string these areas together between countries.

Advertisement

“On the other extreme, even if the Supreme Court finds in favor of the taxpayers, they could do so in a narrow way that’s limited to the particular situation at hand, or in a way that … forecloses the possibility of Congress enacting wealth taxes but that doesn’t disturb much of existing tax law,” Brennan said.

FILE – The exterior of the Internal Revenue Service (IRS) building in Washington on March 22, 2013.(AP Photo/Susan Walsh, File)

What is the Moore tax case?

The dispute arose from businesspeople Charles and Kathleen Moore’s investment in an Indian company that sells farm equipment.

Republicans’ 2017 tax bill imposed a one-time tax on Americans who owned shares in foreign corporations, even if the corporation hadn’t distributed any earnings to the taxpayer.

Advertisement

Avoiding taxes gets new scrutiny: IRS eyes partnerships in tax evasion crackdown

The Moores filed their lawsuit after paying a roughly $15,000 tax bill, court filings show.

Practical financial workarounds to realization

Whatever the decision of the court, which is expected before June of next year, there are in practice numerous, well-established workarounds for people who own a lot of “unrealized” property to access it before technically receiving it and having to pay taxes on it.

One famous strategy, known as “Buy, Borrow, Die,” involves using large, diversified stock portfolios as collateral for relatively low-interest loans. 

Advertisement

Rather than selling the holdings and “realizing” the taxable income, wealthy taxpayers use them as collateral to take out low-interest loans. Since debt isn’t taxable, they can skip paying tax on the holdings.

As long as the portfolio appreciates faster than the rate of interest on the loan, payments can be made and the line of credit remains viable.

On the horizon: IRS establishes new pass-through division to tax high earners

A law allowing a “step up in basis,” which means that inheritors of assets get to claim their present-worth value as opposed to what they were worth when they were originally bought, permits this scheme to continue through generations.

Advertisement

That’s compared to taxes on workers’ wages and salaries, which are “realized” immediately upon being sent out and taxed before they even reach their recipients.

Conservative groups champing at the bit while critics cry foul

Conservative financial and economic groups have been rooting for a resounding endorsement of the realization requirement for tax purposes from the current court, which brushed aside decades of precedent in overturning the seminal abortion case Roe v. Wade last year. 

“Realization has been the defining event that turns something from an asset holding value to income subject to federal tax under the Sixteenth Amendment,” lawyers for the Chamber of Commerce, the biggest business lobby in the U.S., exhorted the court in an amicus brief, filed in March.

“The framers [of the Constitution] intentionally created a system that makes it difficult to pass destructive taxes such as the [mandatory repatriation tax] or a wealth tax,” the Philanthropy Roundtable wrote in their own brief.

Advertisement

Critics of a blanket constitutional requirement for realization say the idea is trumped up, and it’s really just about the timing of when an asset is allowed to be taxed for accounting purposes.

They point to a 1940 decision in Helvering v. Horst finding that “the rule that income is not taxable until realized has never been taken to mean that the taxpayer … can escape taxation because he has not himself received payment of it from his obligor.”

This is because the taxpayer “has fully enjoyed the benefit of the economic gain represented by his right to receive income,” the court found. As such, the requirement was considered to be “founded on administrative convenience” and “not one of exemption from taxation.”

FILE – Supreme Court Justice Samuel Alito addresses the audience during a lecture Sept. 30, 2021 in the McCartan Courtroom at the University of Notre Dame Law School in South Bend, Ind. (Michael Caterina /South Bend Tribune via AP, File)

Advertisement

Calls for Alito to recuse have surfaced

Democrats have demanded that Justice Samuel Alito, one of the court’s leading conservatives, be recused from the case over his ties to one of the lawyers advocating for a realization requirement.

Alito participated in two interviews with the lawyer, David Rivkin Jr., that were published in The Wall Street Journal’s opinion section.

In a rare public response, Alito noted other justices who had interviewed with lawyers practicing before the court.

“There is no valid reason for my recusal in this case,” Alito said.

Advertisement

Tax lawyers worry the rules of the game are about to change

Tax lawyers are concerned that their jobs could change significantly due to the scope of the ruling.

“If [the court makes] a specific realization requirement, then it could have an impact on many other provisions of the Internal Revenue Code, because there are provisions currently … that arguably diverge from the realization rule,” Lawrence Hill, a partner at the Steptoe & Johnson law firm, told The Hill.

He described these divergences as “very significant,” saying the rules pertaining to taxation of partnerships, S corporations, grantor trusts, controlled foreign corporations and original issue discounts could be affected, in addition to entire accounting norms pertaining to tax accrual and adjusting valuations to a going market rate.

“That is the concern of the tax bar,” he said.

Advertisement

SCOTUS adopts code of ethics after scrutiny: Dems say it’s not enough

Kyle Pomerleau, a senior fellow at the American Enterprise Institute who filed an amicus brief supporting the government, said a broad ruling in favor of the Moores could lead others to file a deluge of lawsuits challenging those other portions of the tax code.

“A cloud is going to be cast over the U.S. economy, as there’s all this uncertainty about what the tax code is going to look like in five, 10, 15 years from now.”

Pomerleau instead suggested a narrower way for the Supreme Court to resolve the case that wouldn’t reopen the question of whether income must be realized for the federal government to tax it.

Advertisement

“Because this is a tax on business profits and a tax on the use of a certain type of foreign business entity, and because it’s a tax on foreign activity, not domestic activity, it falls under the umbrella of an indirect tax,” said Pomerleau.

“And indirect taxes don’t have the same limitation that direct taxes have under the Constitution, you don’t have to apportion them,” he continued. “Therefore, all of the Moores’ arguments kind of fall away.”

​Business, News, Policy, Technology, deficit, partnerships, Supreme Court, Supreme Court ethics, taxes, wealth tax The Supreme Court will hear oral arguments in early December on a case that has the potential to broadly reshape the U.S. tax code and cost the government hundreds of billions of dollars in revenue. At issue in Moore v. United States is the question of whether the federal government can tax certain types of…  

Advertisement
Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

How Epstein’s Cash Shaped Artists, Agencies, and Algorithms

Published

on

Jeffrey Epstein’s money did more than buy private jets and legal leverage. It flowed into the same ecosystem that decides which artists get pushed to the front, which research gets labeled “cutting edge,” and which stories about race and power are treated as respectable debate instead of hate speech. That doesn’t mean he sat in a control room programming playlists. It means his worldview seeped into institutions that already shape what we hear, see, and believe.

The Gatekeepers and Their Stains

The fallout around Casey Wasserman is a vivid example of how this works. Wasserman built a powerhouse talent and marketing agency that controls a major slice of sports, entertainment, and the global touring business. When the Epstein files revealed friendly, flirtatious exchanges between Wasserman and Ghislaine Maxwell, and documented his ties to Epstein’s circle, artists and staff began to question whose money and relationships were quietly underwriting their careers.

That doesn’t prove Epstein “created” any particular star. But it shows that a man deeply entangled with Epstein was sitting at a choke point: deciding which artists get representation, which tours get resources, which festivals and campaigns happen. In an industry built on access and favor, proximity to someone like Epstein is not just gossip; it signals which values are tolerated at the top.

When a gatekeeper with that history sits between artists and the public, “the industry” stops being an abstract machine and starts looking like a web of human choices — choices that, for years, were made in rooms where Epstein’s name wasn’t considered a disqualifier.

Funding Brains, Not Just Brands

Epstein’s interest in culture didn’t end with celebrity selfies. He was obsessed with the science of brains, intelligence, and behavior — and that’s where his money begins to overlap with how audiences are modeled and, eventually, how algorithms are trained.

He cultivated relationships with scientists at elite universities and funded research into genomics, cognition, and brain development. In one high‑profile case, a UCLA professor specializing in music and the brain corresponded with Epstein for years and accepted funding for an institute focused on how music affects neural circuits. On its face, that looks like straightforward philanthropy. Put it next to his email trail and a different pattern appears.

Advertisement

Epstein’s correspondence shows him pushing eugenics and “race science” again and again — arguing that genetic differences explain test score gaps between Black and white people, promoting the idea of editing human beings under the euphemism of “genetic altruism,” and surrounding himself with thinkers who entertained those frames. One researcher in his orbit described Black children as biologically better suited to running and hunting than to abstract thinking.

So you have a financier who is:

  • Funding brain and behavior research.
  • Deeply invested in ranking human groups by intelligence.
  • Embedded in networks that shape both scientific agendas and cultural production.

None of that proves a specific piece of music research turned into a specific Spotify recommendation. But it does show how his ideology was given time, money, and legitimacy in the very spaces that define what counts as serious knowledge about human minds.

How Ideas Leak Into Algorithms

There is another layer that is easier to see: what enters the knowledge base that machines learn from.

Fringe researchers recently misused a large U.S. study of children’s genetics and brain development to publish papers claiming racial hierarchies in IQ and tying Black people’s economic outcomes to supposed genetic deficits. Those papers then showed up as sources in answers from large AI systems when users asked about race and intelligence. Even after mainstream scientists criticized the work, it had already entered both the academic record and the training data of systems that help generate and rank content.

Epstein did not write those specific papers, but he funded the kind of people and projects that keep race‑IQ discourse alive inside elite spaces. Once that thinking is in the mix, recommendation engines and search systems don’t have to be explicitly racist to reproduce it. They simply mirror what’s in their training data and what has been treated as “serious” research.

Advertisement

Zoomed out, the pipeline looks less like a neat conspiracy and more like an ecosystem:

  • Wealthy men fund “edgy” work on genes, brains, and behavior.
  • Some of that work revives old racist ideas with new data and jargon.
  • Those studies get scraped, indexed, and sometimes amplified by AI systems.
  • The same platforms host and boost music, video, and news — making decisions shaped by engagement patterns built on biased narratives.

The algorithm deciding what you see next is standing downstream from all of this.

The Celebrity as Smoke Screen

Epstein’s contact lists are full of directors, actors, musicians, authors, and public intellectuals. Many now insist they had no idea what he was doing. Some probably didn’t; others clearly chose not to ask. From Epstein’s perspective, the value of those relationships is obvious.

Being seen in orbit around beloved artists and cultural figures created a reputational firewall. If the public repeatedly saw him photographed with geniuses, Oscar winners, and hit‑makers, their brains filed him under “eccentric patron” rather than “dangerous predator.”

That softens the landing for his ideas, too. Race science sounds less toxic when it’s discussed over dinner at a university‑backed salon or exchanged in emails with a famous thinker.

The more oxygen is spent on the celebrity angle — who flew on which plane, who sat at which dinner — the less attention is left for what may matter more in the long run: the way his money and ideology were welcomed by institutions that shape culture and knowledge.

Advertisement
Ghislaine Maxwell seen alongside Jeffrey Epstein in newly-released Epstein files from the DOJ. (DOJ)

What to Love, Who to Fear

The point is not to claim that Jeffrey Epstein was secretly programming your TikTok feed or hand‑picking your favorite rapper. The deeper question is what happens when a man with his worldview is allowed to invest in the people and institutions that decide:

  • Which artists are “marketable.”
  • Which scientific questions are “important.”
  • Which studies are “serious” enough to train our machines on.
  • Which faces and stories are framed as aspirational — and which as dangerous.

If your media diet feels saturated with certain kinds of Black representation — hyper‑visible in music and sports, under‑represented in positions of uncontested authority — while “objective” science quietly debates Black intelligence, that’s not random drift. It’s the outcome of centuries of narrative work that men like Epstein bought into and helped sustain.

No one can draw a straight, provable line from his bank account to a specific song or recommendation. But the lines he did draw — to elite agencies, to brain and music research, to race‑obsessed science networks — are enough to show this: his money was not only paying for crimes in private. It was also buying him a seat at the tables where culture and knowledge are made, where the stories about who to love and who to fear get quietly agreed upon.

Bill Clinton and English musician Mick Jagger in newly-released Epstein files from the DOJ. (DOJ)

A Challenge to Filmmakers and Creatives

For anyone making culture inside this system, that’s the uncomfortable part: this isn’t just a story about “them.” It’s also a story about you.

Filmmakers, showrunners, musicians, actors, and writers all sit at points where money, narrative, and visibility intersect. You rarely control where the capital ultimately comes from, but you do control what you validate, what you reproduce, and what you challenge.

Questions worth carrying into every room:

  • Whose gaze are you serving when you pitch, cast, and cut?
  • Which Black characters are being centered — and are they full humans or familiar stereotypes made safe for gatekeepers?
  • When someone says a project is “too political,” “too niche,” or “bad for the algorithm,” whose comfort is really being protected?
  • Are you treating “the industry” as a neutral force, or as a set of human choices you can push against?

If wealth like Epstein’s can quietly seep into agencies, labs, and institutions that decide what gets made and amplified, then the stories you choose to tell — and refuse to tell — become one of the few levers of resistance inside that machine. You may not control every funding source, but you can decide whether your work reinforces a world where Black people are data points and aesthetics, or one where they are subjects, authors, and owners.

The industry will always have its “gatekeepers.” The open question is whether creatives accept that role as fixed, or start behaving like counter‑programmers: naming the patterns, refusing easy archetypes, and building alternative pathways, platforms, and partnerships wherever possible. In a landscape where money has long been used to decide what to love and who to fear, your choices about whose stories get light are not just artistic decisions. They are acts of power.

Advertisement
Continue Reading

Business

New DOJ Files Reveal Naomi Campbell’s Deep Ties to Jeffrey Epstein

Published

on

In early 2026, the global conversation surrounding the “Epstein files” has reached a fever pitch as the Department of Justice continues to un-redact millions of pages of internal records. Among the most explosive revelations are detailed email exchanges between Ghislaine Maxwell and Jeffrey Epstein that directly name supermodel Naomi Campbell. While Campbell has long maintained she was a peripheral figure in Epstein’s world, the latest documents—including an explicit message where Maxwell allegedly offered “two playmates” for the model—have forced a national re-evaluation of her proximity to the criminal enterprise.

The Logistics of a High-Fashion Connection

The declassified files provide a rare look into the operational relationship between the supermodel and the financier. Flight logs and internal staff emails from as late as 2016 show that Campbell’s travel was frequently subsidized by Epstein’s private fleet. In one exchange, Epstein’s assistants discussed the urgency of her travel requests, noting she had “no backup plan” and was reliant on his jet to reach international events.

Screenshot

This level of logistical coordination suggests a relationship built on significant mutual favors, contrasting with Campbell’s previous descriptions of him as just another face in the crowd.

In Her Own Words: The “Sickened” Response

Campbell has not remained silent as these files have surfaced, though her defense has been consistent for years. In a widely cited 2019 video response that has been recirculated amid the 2026 leaks, she stated, “What he’s done is indefensible. I’m as sickened as everyone else is by it.” When confronted with photos of herself at parties alongside Epstein and Maxwell, she has argued against the concept of “guilt by association,” telling the press:

“I’ve always said that I knew him, as I knew many other people… I was introduced to him on my 31st birthday by my ex-boyfriend. He was always at the Victoria’s Secret shows.”

She has further emphasized her stance by aligning herself with those Epstein harmed, stating,

“I stand with the victims. I’m not a person who wants to see anyone abused, and I never have been.””

The Mystery of the “Two Playmates”

The most damaging piece of evidence in the recent 2026 release is an email where Maxwell reportedly tells Epstein she has “two playmates” ready for Campbell.

While the context of this “offer” remains a subject of intense debate—with some investigators suggesting it refers to the procurement of young women for social or sexual purposes—Campbell’s legal team has historically dismissed such claims as speculative. However, for a public already wary of elite power brokers, the specific wording used in these private DOJ records has created a “stop-the-scroll” moment that is proving difficult for the fashion icon to move past.

A Reputation at a Crossroads

As a trailblazer in the fashion industry, Campbell is now navigating a period where her professional achievements are being weighed against her presence in some of history’s most notorious social circles. The 2026 files don’t just name her; they place her within a broader system where modeling agents and scouts allegedly groomed young women under the guise of high-fashion opportunities. Whether these records prove a deeper complicity or simply illustrate the unavoidable overlap of the 1% remains the central question of the ongoing DOJ investigation.

Advertisement
Continue Reading

Business

Google Accused Of Favoring White, Asian Staff As It Reaches $28 Million Deal That Excludes Black Workers

Published

on

Google has tentatively agreed to a $28 million settlement in a California class‑action lawsuit alleging that white and Asian employees were routinely paid more and placed on faster career tracks than colleagues from other racial and ethnic backgrounds.

How The Discrimination Claims Emerged

The lawsuit was brought by former Google employee Ana Cantu, who identifies as Mexican and racially Indigenous and worked in people operations and cloud departments for about seven years. Cantu alleges that despite strong performance, she remained stuck at the same level while white and Asian colleagues doing similar work received higher pay, higher “levels,” and more frequent promotions.

Cantu’s complaint claims that Latino, Indigenous, Native American, Native Hawaiian, Pacific Islander, and Alaska Native employees were systematically underpaid compared with white and Asian coworkers performing substantially similar roles. The suit also says employees who raised concerns about pay and leveling saw raises and promotions withheld, reinforcing what plaintiffs describe as a two‑tiered system inside the company.

Why Black Employees Were Left Out

Cantu’s legal team ultimately agreed to narrow the class to employees whose race and ethnicity were “most closely aligned” with hers, a condition that cleared the path to the current settlement.

The judge noted that Black employees were explicitly excluded from the settlement class after negotiations, meaning they will not share in the $28 million payout even though they were named in earlier versions of the case. Separate litigation on behalf of Black Google employees alleging racial bias in pay and promotions remains pending, leaving their claims to be resolved in a different forum.

What The Settlement Provides

Of the $28 million total, about $20.4 million is expected to be distributed to eligible class members after legal fees and penalties are deducted. Eligible workers include those in California who self‑identified as Hispanic, Latinx, Indigenous, Native American, American Indian, Native Hawaiian, Pacific Islander, and/or Alaska Native during the covered period.

Beyond cash payments, Google has also agreed to take steps aimed at addressing the alleged disparities, including reviewing pay and leveling practices for racial and ethnic gaps. The settlement still needs final court approval at a hearing scheduled for later this year, and affected employees will have a chance to opt out or object before any money is distributed.

H2: Google’s Response And The Broader Stakes

A Google spokesperson has said the company disputes the allegations but chose to settle in order to move forward, while reiterating its public commitment to fair pay, hiring, and advancement for all employees. The company has emphasized ongoing internal audits and equity initiatives, though plaintiffs argue those efforts did not prevent or correct the disparities outlined in the lawsuit.

For many observers, the exclusion of Black workers from the settlement highlights the legal and strategic complexities of class‑action discrimination cases, especially in large, diverse workplaces. The outcome of the remaining lawsuit brought on behalf of Black employees, alongside this $28 million deal, will help define how one of the world’s most powerful tech companies is held accountable for alleged racial inequities in pay and promotion.

Advertisement
Continue Reading

Trending