Case law opens options for trusts looking to minimize state income taxes

When does the state lack authority to tax a “resident trust” on out-of-state income? In this report, McGladrey discusses a number of strategies that advisers should consider in order to minimize the state-level tax liability for a trust by moving it to a more taxpayer-friendly jurisdiction. The article provides case studies dating back to 2013, where in some cases, advisers and their clients either minimized or even avoided state tax liability altogether on undistributed trust income.