The United States Supreme Court case, UNITED STATES v. CLEVELAND INDIANS BASEBALL COMPANY, revolved around the issue of when back wages should be taxed. The Cleveland Indians Baseball Company had settled a labor dispute with two players in 1994 but did not pay them until 1995. The Internal Revenue Service (IRS) argued that the team owed taxes on those wages for 1994, while the baseball company maintained they should be taxed in 1995 when payment was made. The Sixth Circuit Court sided with the IRS initially; however, upon reaching the Supreme Court, it was decided by unanimous decision that backpay is taxable in the year it's received rather than when it's awarded or accrued. This ruling clarified tax law regarding wage settlements and established precedent for future cases involving similar disputes.

In the dissenting opinion for United States v. Cleveland Indians Baseball Company, Justice Ginsburg disagreed with the majority's decision to allow back wages to be taxed in the year they were paid rather than when they should have been paid. She argued that this ruling contradicts both IRS regulations and previous court decisions which state that income is taxable in the year it is earned, not when it is received. Furthermore, she contended that this decision unfairly penalizes employees who may face higher tax liabilities due to lump sum payments of back wages pushing them into a higher tax bracket for one year instead of being spread out over multiple years as originally intended. In her view, taxing these earnings in their rightful years would better align with principles of fairness and accuracy within taxation law.