This post was originally published on Forbes Jun 23, 2015
Reading between the lines a bit, I'm thinking that the suit Bank of America NA as Trustee for Certain Trusts v Commissioner or Revenue decided by the Massachusetts Appellate Tax Board was the bank taking a shot at defending its trustee business against law firms. BOA filed abatement claims for 2008 on behalf of 2,987 trusts on which it is trustee. In one of those procedural things, beyond the ken of a mere CPA, the decision is about 34 of the trusts - presumably the answer will be the same for the other 2,953 trusts.
Roy K. Elliot established an Indenture of Trust dated April 21, 1960 (“R.K. Elliot Trust”). The appellant filed a Fiduciary Income Tax Return (“Form 2”) for the tax year at issue for the R.K. Elliot Trust on March 29, 2008, and paid the tax. Later, in the belief that the R.K. Elliot Trust was not a resident inter vivos trust 3 subject to tax under G.L. c. 62, § 10, the appellant filed an Application For Abatement (“Form CA-6”) with the Commissioner on April 4, 2011, requesting an abatement of tax and a refund of all tax paid. The Commissioner did not act on the appellant's Form CA-6 within six months of its filing and on November 10, 2011, the appellant withdrew its consent under G.L. c. 58A, § 6. On November 14, 2011, the appellant, as trustee of the R.K. Elliot Trust, filed its petition with the Board appealing the deemed denial of its abatement application.
a. sought out, developed, and entered into banking and other commercial relationships with individual residents of the Commonwealth and with entities that conducted business in the Commonwealth, including making loans secured by tangible personal property or real property located within the Commonwealth;
b. the appellant conducted business in more than 200 branch offices in the Commonwealth and US Trust in two offices, all of which were staffed by the Trustees' employees;
c. employed residents of the Commonwealth and independent contractors doing business within the Commonwealth;
d. exhibited, promoted, and made known their presence in the Commonwealth by means of advertising;
e. were financial institutions engaged in business within the Commonwealth within the meaning of G.L. c. 63, §§ 1, 2, and 2A;
f. operated and staffed offices, for the purpose of fulfilling some of the their obligations as trustees of the Trusts;
g. maintained relationships with the beneficiaries of the Trusts and, with respect to the appellant, decided when to make distributions of trust assets to beneficiaries in accordance with the terms of the documents establishing certain of the Trusts;
h. administered the assets of the Trusts, created and retained certain records regarding the administration of the assets of the Trusts;
i. consulted with clients and prospective clients about available trust services;
j. discussed accounts with grantors and/or beneficiaries of existing trusts;
k. reviewed with clients and their representatives proposed trust instruments;
l. provided a place for persons to execute trusts which named one of the Trustees as fiduciary; and
m. researched issues involving the Trusts in certain instances and discussed such issues with grantors, beneficiaries and/or their representatives.
The analysis was that of a statutory resident. If an individual has a place to stay in Massachusetts and is in Massachusetts for more than 183 days (sometimes called the New York rule), then that individual is a statutory resident, regardless of domicile.