The Supreme Court recently struck down North Carolina’s attempt to tax undistributed income of a resident trust properly sitused and administered in a no income tax state like South Dakota in North Carolina Department of Revenue v. Kimberley Rice Kaestner 1992 Family Trust. Indicating that to do so is a violation of due process, the Court’s decision is a very important affirmation and validation of powerful state tax planning tools available in non-income tax jurisdictions, and again, underscores the vital importance of selecting the proper trust jurisdiction in the planning process.
South Dakota attorney Terry N. Prendergast of Davenport, Evans, Hurwitz & Smith, LLP, took part in a webinar on July 9, entitled,”Supreme Court Strikes Down Taxation on Undistributed Trust Income – What Does It Mean?” with William Lipkind, attorney, Partner, and Chair of Wilson Elser’s Tax Planning & Controversies practice and Bridgeford Trust Company. The timely webinar discussed one of the most important tax cases in decades. Terry Prendergast is available for questions on the topic. More information will be posted soon regarding access to content now that the webinar has concluded.