The Supreme Court has blocked the Trump administration’s attempt to block tax credits that could help people like Mitt Romney, who make a lot of money, afford to buy homes.
The ruling came in a case brought by Romney’s wife, Ann, in which they argued that the estate tax was unfair because they and other wealthy taxpayers would pay a bigger share of the estate taxes.
In his ruling, Justice Anthony Kennedy said the estate and gift taxes were so high that the average tax bill for a family of four with a taxable income of $75,000 would be more than $20 million.
The justices ruled that the administration did not show the benefits of the proposed changes to the estate, gift and other taxes would be offset by a decrease in the tax bill.
“The estate tax is a tax on the wealth of the last and only person who has ever owned it,” Kennedy wrote in his decision.
It also would be “an effective tax on wealth of an individual with very little income or property,” Kennedy added.
President Donald Trump, center, and Republican Sen. Susan Collins, R-Maine, speak during a news conference in the Rose Garden of the White House in Washington, Tuesday, Jan. 25, 2021.
(AP Photo/Evan Vucci)A similar ruling is expected by the Supreme Court this month, and it could make it harder for the Trump Administration to continue its plan to reduce taxes for the wealthy.
“The administration has repeatedly asserted that it intends to reduce the estate-tax rate and to reduce deductions for the use of the super tax exclusion,” the administration argued in court filings last month.
Democrats and Republicans in Congress, meanwhile, have argued that lowering the estate deduction would hurt the middle class, especially the working poor.
Republicans have argued the deduction is a good idea because it helps middle-class Americans pay less in taxes and also helps to offset the costs of a tax overhaul that is likely to increase the deficit.