The Supreme Court’s decision on taxing offshore earnings could have been an indirect, though significant, move in the fight over wealth taxes — but it didn’t turn out that way.

The justices decided Thursday not to wade into the legality of taxing a household’s paper gains, emphasizing that their 7-2 decision was narrow and confined only to the provisions of the 2017 tax cuts at issue.

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Both supporters and detractors of a wealth tax painted the decision as a glancing win for their side.

“The fight goes on to tax the rich, pass a wealth tax on ultra-millionaires and billionaires, and make the system more fair,” Sen. Elizabeth Warren, a progressive Democrat from Massachusetts who has pushed her own wealth-tax proposals, said in a post on X Thursday.

The ruling “is great news. Next year, there is nothing standing in Congress’s way to make the wealthy pay up,” said Lindsay Owens, executive director of the Groundwork Collaborative, a progressive advocacy group.

On the other side, a future case dealing with what counts as taxable income could “receive a friendly audience from a substantial portion of the Court,” Dan Greenberg said in a statement. Greenberg is general counsel of the libertarian Competitive Enterprise Institute and one of the lawyers for the Washington couple who sued over their tax bill in Moore v. United States, the case just decided by the Supreme Court.

So the fate of proposals to increase taxes on ultrarich Americans may have to wait for the results of November’s congressional and presidential elections, observers say.

With large chunks of the 2017 tax cuts, which were passed during the Trump administration, expiring at the end of 2025, there’s already a lot at stake for taxes in the upcoming election.

The party that controls the White House and Congress will determine what happens next in the tax code. Among other things, five of the seven income-tax rates are poised to revert to higher rates. That includes the top rate of 37%, which would climb to 39.6%.

The Biden administration has a proposal it is calling a billionaires minimum income tax, which would be a 25% tax on households worth at least $100 million and would count unrealized capital gains in its calculations.

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In court papers, the Washington couple that unsuccessfully sued the government said the Supreme Court needed to pre-emptively snuff proposals like the Biden administration’s.

With tax negotiations looming after the election, the unanswered questions from Thursday’s decision leave “more options on the menu,” said John Stanford, managing director of the Prism Group, a Washington, D.C., public-affairs firm that advises corporations, nonprofits and other organizations.

“We just don’t have many revenue raisers on the table for either party to realize its goals,” he said. “Maybe that does make this attractive, and if you could explain it and sell it — that it only impacts a few Americans — it could be politically popular.”

Still, any sort of wealth tax “has a long way to go, even in the Democratic party,” Stanford said.

If President Joe Biden beats former President Donald Trump and the Democrats control Congress, there’s a “nontrivial” chance that superwealthy people could face higher taxes, and even taxes on their wealth instead of their income, said Howard Gleckman, a senior fellow at the nonpartisan Tax Policy Center.

But such a plan would still have to get past the Supreme Court, he said. And for wealth-tax supporters, he added, “if I were them, I would not take much comfort from this case.”

The Biden campaign did not immediately respond to a request for comment.

The Trump campaign said Trump would be offering more tax cuts. “When President Trump is back in the White House, he will advocate for more tax cuts for all Americans and reinvigorate America’s energy industry to bring down inflation, lower the cost of living, and pay down our debt,” said campaign spokeswoman Karoline Leavitt.

‘Nothing in this opinion’

Charles and Kathleen Moore took issue with a $14,729 tax bill connected to their stake in a business focused on rural farmers in India.

The Moores never yielded a penny on their investment, dissenting Justice Clarence Thomas said. However, the company did realize the investment, and the tax code correctly attributed the earnings back to the couple, the majority said.

The majority decision took pains to emphasize that it was sticking close to the facts of a dispute over the mandatory repatriation tax, which was geared at the foreign-subsidiary earnings of U.S. parent companies.

“Nothing in this opinion should be read to authorize any hypothetical congressional effort to tax both an entity and its shareholders or partners on the same undistributed income realized by the entity,” Justice Brett Kavanaugh wrote in the majority opinion.

The majority didn’t touch the overarching question of whether gains need to be converted into real-world income before taxes could kick in.

Still, there’s a majority opinion, two different concurrences and a dissent tucked into the decision. Parsing Moore v. United States, some observers say there are expectations by many on the bench that income needs to be realized before taxes kick in.

That wouldn’t bode well for something like Biden’s proposed billionaire minimum income tax, said Alan Cole, senior economist at the nonpartisan Tax Foundation.

Justice Amy Coney Barrett sided with the majority but wrote an agreeing opinion with Justice Samuel Alito that’s “about as thin a concurrence as you could possible get,” Cole said.

After Barrett and Alito, along with Thomas and fellow dissenter Justice Neil Gorsuch, Cole said it would only take one more vote to say that income must be realized before taxes apply.

“If you’re on the pro-wealth-tax side of things, I think it’s very possible this composition of the court is never going to work out for you,” Cole said.

Of course, the Supreme Court’s composition itself also hinges on elections.

The next president will have the chance to pick at least two new nominees to the Supreme Court, Biden reportedly said at a recent Los Angeles fundraiser.

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