North Carolina Dept. of Revenue v. Kimberley Rice Kaestner 1992 Family Trust

This case was about whether North Carolina could tax a trust’s undistributed income just because the trust’s beneficiary lived in North Carolina, even though the trust itself had no trustee, property, or investments in the state and made no distributions there during the tax years at issue. The Supreme Court held that the Due Process Clause does not allow a state to tax trust income based only on the in-state residence of beneficiaries in those circumstances.