Would a Money Manager be Liable For Causing a Client to Lose a Tax Credit?

Questions? Comments? We love feedback! Email us at [email protected] Rav Aryeh FinkelQuestion: There is a threshold of how much investment income a taxpayer can have and still be eligible for the Earned Income Credit. Reuven told his money manager to make sure he doesn’t go over that threshold, as it would not be worthwhile to lose out on the credit. The money manager disobeyed his instructions and made him some extra money on an investment which caused him to lose the Earned Income Credit. Is he liable to pay him for that loss? Answer: This is certainly not an act of damage, but it might be garmi.The Poskim discuss a case called “mevatel kiso shel chavero”, which is where someone caused his friend a loss of potential income. An example of this would be if someone locks up his friend’s merchandise so that he cannot sell it on the market day, thereby causing him a loss of profit that he could have made. The Poskim rule that this is a case of grama, which means that he is exempt in bais din but liable in dinei Shomayim. It could be argued that this case is the same, as the money manager is causing the client to lose a profit that he otherwise could have made.Moreover, one might claim that because an Earned Income Credit is given automatically by the IRS to any family that qualifies, the money is already his and is just waiting to be claimed. Thus, it is even more of a direct loss than mevatel kiso shel chavero, which is only a loss of potential profit that could potentially h