October Term 2018 · Docket 18-457
Can a state tax trust income based on a beneficiary's residency?
North Carolina taxes trust income using a beneficiary's state residency. The trust argues this violates the Commerce Clause.
Verified source milestones
- — An official oral-argument transcript was verified.
The arguments, in order
This case may have been argued more than once. Each entry below uses that session's official transcript. Later arguments do not erase earlier ones.
Argument 1 ·
What happened at the argument
North Carolina argues beneficiaries own trust income under trust law.
The trust argues the state cannot tax income it does not own.
questions
Read the official transcript for this argument · Official argument details
Sources used for this argument breakdown
- Official Supreme Court Transcript — file page 34, lines 8-28 — Transcript, file page 34, lines 8-28
- Official Supreme Court Transcript — file page 4, lines 17-31 — Transcript, file page 4, lines 17-31
- Official Supreme Court Transcript — file page 4, lines 32-36 — Transcript, file page 4, lines 32-36
- Official Supreme Court Transcript — file page 4, lines 8-16 — Transcript, file page 4, lines 8-16
- Official Supreme Court Transcript — file page 5, lines 15-16 — Transcript, file page 5, lines 15-16
- Official Supreme Court Transcript — file page 5, lines 22-26 — Transcript, file page 5, lines 22-26
- Official Supreme Court Transcript — file page 5, lines 34-36 — Transcript, file page 5, lines 34-36
- Official Supreme Court Transcript — file page 6, lines 11-20 — Transcript, file page 6, lines 11-20
- Official Supreme Court Transcript — file page 6, lines 23-26 — Transcript, file page 6, lines 23-26
- Official Supreme Court Transcript — file page 6, lines 33-34 — Transcript, file page 6, lines 33-34
- Official Supreme Court Transcript — file page 7, lines 32-34 — Transcript, file page 7, lines 32-34
- Official Supreme Court Transcript — file page 7, lines 7-12 — Transcript, file page 7, lines 7-12
- Official Supreme Court Transcript — file page 8, lines 15-15 — Transcript, file page 8, lines 15-15
- Official Supreme Court Transcript — file page 8, lines 16-18 — Transcript, file page 8, lines 16-18
- Official Supreme Court Transcript — file page 8, lines 21-27 — Transcript, file page 8, lines 21-27
A citizen's guide to the whole case
What this case is about
North Carolina taxes trust income based on where beneficiaries live. The trust argues this violates the Commerce Clause.
Official sources for this section
- Official Supreme Court Transcript — file page 34, lines 8-28 — Transcript, file page 34, lines 8-28
- Official Supreme Court Transcript — file page 4, lines 17-31 — Transcript, file page 4, lines 17-31
How the case got here
The Supreme Court heard oral argument in this case on April 16, 2019.
Official sources for this section
- Official Supreme Court Transcript — file page 4, lines 8-16 — Transcript, file page 4, lines 8-16
What each side wants
North Carolina wants to tax trust income based on beneficiary residency.
The trust wants to avoid state tax on its income.
Official sources for this section
- Official Supreme Court Transcript — file page 34, lines 8-28 — Transcript, file page 34, lines 8-28
- Official Supreme Court Transcript — file page 4, lines 17-31 — Transcript, file page 4, lines 17-31
What each side says
North Carolina argues beneficiaries are true owners of trust income.
The trust argues the state cannot tax income it does not own.
Official sources for this section
- Official Supreme Court Transcript — file page 34, lines 8-28 — Transcript, file page 34, lines 8-28
- Official Supreme Court Transcript — file page 4, lines 17-31 — Transcript, file page 4, lines 17-31
What the justices asked
Chief Justice Roberts asked if the trust's home state could tax the same income.
Justice Sotomayor asked how the state knows the beneficiary will receive the income.
Official sources for this section
- Official Supreme Court Transcript — file page 4, lines 32-36 — Transcript, file page 4, lines 32-36
- Official Supreme Court Transcript — file page 5, lines 15-16 — Transcript, file page 5, lines 15-16
- Official Supreme Court Transcript — file page 5, lines 22-26 — Transcript, file page 5, lines 22-26
- Official Supreme Court Transcript — file page 5, lines 34-36 — Transcript, file page 5, lines 34-36
- Official Supreme Court Transcript — file page 6, lines 11-20 — Transcript, file page 6, lines 11-20
- Official Supreme Court Transcript — file page 6, lines 23-26 — Transcript, file page 6, lines 23-26
- Official Supreme Court Transcript — file page 6, lines 33-34 — Transcript, file page 6, lines 33-34
- Official Supreme Court Transcript — file page 7, lines 32-34 — Transcript, file page 7, lines 32-34
- Official Supreme Court Transcript — file page 7, lines 7-12 — Transcript, file page 7, lines 7-12
- Official Supreme Court Transcript — file page 8, lines 15-15 — Transcript, file page 8, lines 15-15
- Official Supreme Court Transcript — file page 8, lines 16-18 — Transcript, file page 8, lines 16-18
- Official Supreme Court Transcript — file page 8, lines 21-27 — Transcript, file page 8, lines 21-27
Why it matters
This case defines state power to tax trust income. It affects how states collect revenue from trusts.
Official sources for this section
- Official Supreme Court Transcript — file page 34, lines 8-28 — Transcript, file page 34, lines 8-28
- Official Supreme Court Transcript — file page 4, lines 17-31 — Transcript, file page 4, lines 17-31
What happens next
This article currently covers the argument record. Use the official docket link for later case activity.
Official sources for this section
- Official Supreme Court Transcript — file page 4, lines 32-36 — Transcript, file page 4, lines 32-36
- Official Supreme Court Transcript — file page 4, lines 8-16 — Transcript, file page 4, lines 8-16
- Official Supreme Court Transcript — file page 5, lines 15-16 — Transcript, file page 5, lines 15-16
- Official Supreme Court Transcript — file page 5, lines 22-26 — Transcript, file page 5, lines 22-26
- Official Supreme Court Transcript — file page 5, lines 34-36 — Transcript, file page 5, lines 34-36
- Official Supreme Court Transcript — file page 6, lines 11-20 — Transcript, file page 6, lines 11-20
- Official Supreme Court Transcript — file page 6, lines 23-26 — Transcript, file page 6, lines 23-26
- Official Supreme Court Transcript — file page 6, lines 33-34 — Transcript, file page 6, lines 33-34
- Official Supreme Court Transcript — file page 7, lines 32-34 — Transcript, file page 7, lines 32-34
- Official Supreme Court Transcript — file page 7, lines 7-12 — Transcript, file page 7, lines 7-12
- Official Supreme Court Transcript — file page 8, lines 15-15 — Transcript, file page 8, lines 15-15
- Official Supreme Court Transcript — file page 8, lines 16-18 — Transcript, file page 8, lines 16-18
- Official Supreme Court Transcript — file page 8, lines 21-27 — Transcript, file page 8, lines 21-27
Official Court provenance
Official docket and case history · Official Supreme Court oral-argument detail page
Title and summary sources
- Official Supreme Court Transcript — file page 34, lines 8-28 — Transcript, file page 34, lines 8-28
- Official Supreme Court Transcript — file page 4, lines 17-31 — Transcript, file page 4, lines 17-31
- Official Supreme Court Transcript — file page 34, lines 8-28 — Transcript, file page 34, lines 8-28
- Official Supreme Court Transcript — file page 4, lines 17-31 — Transcript, file page 4, lines 17-31
Revision history
- Revision 1 · Official Transcript ·
Correction: Rewritten to the concise citizen-facing editorial standard.
- Revision 2 · Official Transcript ·
Correction: Migrated to the dated official Court activity contract without model use.