U.S. Supreme Court Will Review North Carolina Trust Fund Tax

The U.S. Supreme Court has agreed to review a North Carolina case revolving around a state tax on out-of-state trust funds.

Current North Carolina law allows the state to tax trust beneficiaries if they live in the state, even if their assets and disbursements are out-of-state.

But a ruling last summer by the North Carolina Supreme Court declared the tax unconstitutional.

The Department of Revenue says North Carolina and other states stand to lose hundreds of millions of dollars in tax revenue annually if that ruling is upheld.

According to the News and Observer, state attorneys claim a federal decision could resolve long-standing conflicts over trust law in the U.S., elevating this to a landmark case.

North Carolina revenue agency lawyers say split decisions in a variety of similar lawsuits allow wealthy people with large trust funds to avoid paying taxes altogether.

The U.S. Supreme Court on Friday agreed to review the lower court ruling.