Attorney-at-Law

CONSTITUTIONALLY SPEAKING

In Uncategorized on 01/11/2021 at 16:07

No, this is nothing to do with elections or politics. Patrick C. Kelley, 2021 T. C. Memo. 2, filed 1/11/21, is complaining that his equal protection rights were violated when Congress enacted Section 86(c)(1)(C) and Section 86(c)(2)(C).

Pat is married to Mrs. Pat for the entire year at issue. They did file a LA Separate Property Matrimonial Regime, apparently a Code Napoleonic pre-nup, which gave rise to their MFS returns. Pat wanted the $25K base for his Social Security benefits, but only got zero.

Judge Elizabeth A (“Tex”) Copeland has this.

Originally Social Security was non-taxable, but to harmonize it with other retirement income like pensions, and to preserve non-taxability for the truly poor, but to prevent geriatric high-rollers from getting a windfall, Congress enacted the tax-free ceilings.

But gameplayers could file MFS, doubling up on the tax-free ceiling.

Now generally (love that word!) pore l’il ole Tax Court has zero jurisdiction when That Document is invoked. But Congress has left a minuscule lacuna wherein Tax Court may step a cautious toe, and that is where, inter alia (as my expensive colleagues say) the taxable portion of Social Security benefits is involved.

Unhappily for Pat and the rest of us Socially Securitized, Tax Court has ruled before now that Congress has a rational basis for the class distinction that torpedoes us. You’ll find the cases at 2021 T. C. Memo. 2, at p. 8.

And Congress decided to jump to the defense of marriage, Constitutionally. “… Congress reasoned that married couples should be treated as a unit to prevent windfalls to couples that might otherwise file separate returns. This reasoning demonstrates that Congress had a valid and rational basis for establishing a separate classification for a taxpayer who lived with a spouse for any part of the taxable year and filed a separate return.” 2021 T. C. Memo. 2, at p. 9.

And Tax Court must follow the law, however harsh it may be for Pat.

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