TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Sunday, June 24, 2012

The Constitutionality of Retroactive Estate Tax Legislation

Peter Kosydar (J.D. 2012, Notre Dame), Note, "Death and Taxes" or Death Without Taxes?, 37 J. Legis. 224 (2012):

This note will discuss whether it would be constitutional for Congress to retroactively apply an estate tax to those wealthy individuals who died in 2010 and, if so, whether there would be any limitations Congress must consider in applying the tax. The note will also discuss the ramifications of Congress enacting a retroactive estate tax, and whether its negative effect on taxpayers would outweigh its benefit to the United States. Part I of this note will begin by looking at the opposing views regarding the estate tax and the history of the estate tax in the United States. Part II will look at the history of retroactive legislation to see how it has been used by Congress and how it has been considered by the Supreme Court. Part III will discuss the specific arguments used by taxpayers against retroactive tax legislation, and will examine how courts have decided on each argument in the past. Part IV will examine the Supreme Court's most recent decision regarding retroactive taxes: United States v. Carlton. Part V will discuss the specific arguments used by the taxpayer against retroactive estate tax legislation in NationsBank v. United States and will examine how the Court of Appeals decided on each argument. Part VI, will look at the potential ramifications of allowing Congress to impose a retroactive estate tax for 2010. Finally, Part VII will determine whether Congress could constitutionally impose an estate tax on decedents who died in 2010 based on the history of the estate tax and the recent case law relating to retroactive implementation of estate taxes. It will then discuss whether the negative effect that such a tax would have on taxpayers outweighs the benefit it would provide to the United States.

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