Daily Gold Market Report

Taxing Unrealized Gains
How the Moore v. U.S. Case Could Shape Future U.S. Tax Policies

(USAGOLD – 12/21/2023) Gold prices are remaining range bound as we wait for a monthly report from the Bureau of Economic Analysis due Friday morning. Six-month annualized rate expected to fall to 2% in November PCE report. Gold is trading at $2038.41, up $7.02 cents. Silver is trading at $24.25, up 11 cents. Recently reported by the Epoch Times, the case of Moore v. U.S. before the Supreme Court holds particular significance, given its potential implications for wealth preservation and taxation strategies. This case scrutinizes the 2017 Tax Cuts and Jobs Act (TCJA) and its transition from a worldwide to a territorial tax system, specifically regarding the taxation of unremitted foreign corporation profits. For gold enthusiasts, who often seek assets that retain value outside traditional currency systems and resist undue taxation, the core issue here is whether the increase in value of assets (like gold) should be considered taxable income before any actual realization event, such as a sale.

The Moores’ challenge to the TCJA, arguing that the appreciation of their foreign corporation shares isn’t “income” in the traditional sense, echoes a fundamental belief in the gold community: that unrealized gains shouldn’t be subjected to taxation, as it contradicts historical and practical definitions of income.

The Supreme Court’s deliberations and eventual decision could set a precedent affecting not just stockholders but also gold investors. The possibility that the Court might sanction the taxation of unrealized gains is concerning. Such a move could compel investors to liquidate assets prematurely to meet tax obligations, potentially destabilizing carefully constructed wealth preservation strategies that favor tangible assets like gold. However, any decision favoring the government’s position might be narrowly tailored, offering some reassurance that a broad-based wealth tax on unrealized gains remains unlikely. This case underscores the ongoing need to stay vigilant in protecting assets against shifting tax landscapes.