- 5 - Moreover, the parties stipulated that petitioner would have satisfied the first requirement if he had owned more than 5 percent of the engineering consulting firms. Petitioners’ only claim is that section 469(c)(7)(D)(ii) is unconstitutional because, by treating a nonowner employee differently than a “5–percent owner”, the statute violates the Fifth Amendment’s guaranty of equal protection under the laws. Generally, a statutory classification is valid if it is rationally related to a legitimate government interest. See Regan v. Taxation With Representation, 461 U.S. 540, 547 (1983). We would apply a higher standard of review if the statute infringed fundamental rights or targeted a suspect class. See, e.g., id.; Harris v. McRae, 448 U.S. 297, 322 (1980). In taxation, more so than in some other fields, Congress has broad classification powers. See Regan v. Taxation With Representation, supra; Lehnhausen v. Lake Shore Auto Parts Co., 410 U.S. 356, 359 (1973); Steward Mach. Co. v. Davis, 301 U.S. 548, 584 (1937); Brushaber v. Union Pac. R.R., 240 U.S. 1, 25–26 (1916); Flint v. Stone Tracy Co., 220 U.S. 107, 158 (1911). As the Supreme Court emphatically noted in Madden v. Kentucky, 309 U.S. 83, 87–88 (1940): The broad discretion as to classification possessed by a legislature in the field of taxation has long been recognized. * * * the passage of time has only served to underscore the wisdom of that recognition of the large area of discretion which is needed by a legis- lature in formulating sound tax policies. * * * SincePage: Previous 1 2 3 4 5 6 7 8 9 Next
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