Bank of America, N.A. v. Commissioner of Revenue (Lawyers Weekly No. 10-096-16)
NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports. If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us SJC-11995 BANK OF AMERICA, N.A., trustee,[1] vs. COMMISSIONER OF REVENUE. Suffolk. March 7, 2016. – July 11, 2016. Present: Gants, C.J., Spina, Cordy, Botsford, Duffly, Lenk, & Hines, JJ. Trust, Taxation. Taxation, Trust, Income tax. Fiduciary. Domicil. Words, “Inhabitant.” Appeal from a decision of the Appellate Tax Board. The Supreme Judicial Court granted an application for direct appellate review. Kevin P. Martin (Joshua M. Daniels with him) for the taxpayer. Kirk G. Hanson, Assistant Attorney General, for Commissioner of Revenue. Phoebe A. Papageorgiou, of the District of Columbia, & Brad S. Papalardo, for Massachusetts Bankers Association & another, amici curiae, submitted a brief. BOTSFORD, J. In this case, we consider whether Bank of America, N.A. (bank), in its capacity as a corporate trustee of several inter vivos trusts, qualifies as an “inhabitant” and accordingly is subject to the fiduciary income tax under G. L. c. 62, § 10, even though the bank is not domiciled in Massachusetts. Considering the bank’s appeal from a decision of the Appellate Tax Board (board) in which the board determined that the bank did qualify as an inhabitant, we affirm the board’s decision on the record of this case, but on somewhat different grounds.[2] Background.[3] The bank is a national banking association authorized to act as a fiduciary. At all relevant times, the bank’s commercial domicil was in North Carolina, with its principal place of business in Charlotte, North Carolina. This case concerns appeals by the bank from the denials, by the Commissioner of Revenue (commissioner), of applications for abatement of fiduciary income taxes paid by thirty-four inter vivos trusts. The taxes were paid by the bank in its capacity as trustee or co-trustee of each of the thirty-four trusts;[4] the taxes paid related to the tax year ended December 31, 2007 (tax year at issue). In 2011, the bank took the position that these thirty-four and similar inter vivos trusts of which the bank served as trustee or co-trustee did not qualify as “resident inter vivos trusts,” as described in 830 Code Mass. Regs. § 62.10.1(1) (b) (2016),[5] and therefore were not subject to fiduciary income tax under G. L. c. 62, § 10 (§ 10). Accordingly, the bank filed with the commissioner 2,987 applications for abatement of the tax and […]