Title: Bank of America, N.A. v. Comm’r of Revenue

State: massachusetts

Issuer: Massachusetts Supreme Court

Document:

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revision and are superseded by the advance sheets and bound 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 
                     
 
1 Of thirty-four trusts. 
2 
 
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 
 
1.  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 
                     
 
2 We acknowledge the amicus brief submitted by the 
Massachusetts Bankers Association and American Bankers 
Association in support of the bank. 
 
 
3 The background facts are undisputed.  This case was 
submitted to the Appellate Tax Board (board) on the parties' 
statement of agreed facts and sixty-four exhibits; in its 
decision, the board made findings based on the statement of 
agreed facts. 
 
4 Effective February 22, 2008, Bank of America, N.A. (bank), 
and United States Trust Company National Association (U.S. 
Trust) were merged; the bank was the surviving entity.  Like the 
bank, U.S. Trust was a national banking association organized 
3 
 
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 refund of all taxes 
paid in the tax year at issue; applications for abatement on 
behalf of the thirty-four trusts involved in the present appeal 
were included.  After six months passed without a decision from 
the commissioner, the bank withdrew its consent to extend the 
time for the commissioner to act with regard to these thirty-
                                                                  
under Federal law and authorized by the Federal Comptroller of 
Currency to act as a fiduciary.  Its commercial domicil was in 
New York, with its principal place of business located in New 
York, New York.  During 2007, U.S. Trust was serving as the 
trustee or co-trustee of eleven of the thirty-four trusts 
involved in this appeal, but after its merger with the bank in 
February, 2008, the bank replaced U.S. Trust as trustee and 
filed all the applications for abatement relating to the tax 
year ending December 31, 2007 (tax year at issue), that are the 
focus of this appeal.  Hereafter, unless otherwise indicated, 
the term "the bank" refers to the bank and U.S. Trust, 
collectively. 
 
 
5 Title 830 Code Mass. Regs. § 62.10.1 (2016) defines inter 
vivos, or "living," trusts and distinguishes "resident inter 
vivos trusts" from "non-resident inter vivos trusts" for 
purposes of determining the amount of fiduciary income subject 
to tax. 
4 
 
four applications for abatement.  As a result, the thirty-four 
applications were deemed denied pursuant to G. L. c. 58A, § 6.6 
 
In November, 2011, the bank filed petitions with the board 
under G. L. c. 58A, § 7, appealing the denial of the thirty-four 
abatement applications; the abatements sought totaled 
$2,287,707.  The parties chose four of the thirty-four trusts 
(subject trusts) to serve as representative trusts for the 
purposes of the appeal, and agreed that the same dispositive 
question of law applied to the remaining thirty trusts.  The 
board issued its findings of fact and report on June 10, 2015, 
and concluded that the bank, in its capacity as trustee, was an 
inhabitant of the Commonwealth within the meaning of G. L. 
c. 62, §§ 1 (f) and 10 (c), during the tax year at issue and 
that the subject trusts were resident inter vivos trusts subject 
to the fiduciary income tax under G. L. c. 62, § 10 (a).  The 
bank filed a notice of appeal from the board's decision and this 
court granted the bank's application for direct appellate 
review. 
The agreed-to facts, which are set out in the board's 
decision, include the following.  The four representative trusts 
that were the subject of the board's decision are the R.K. 
Elliot Trust, the Hovey Trust, the Gordon Trust, and the J.M. 
                     
 
6 The remaining applications for abatement were still 
pending before the Commissioner of Revenue (commissioner) as of 
the time the board issued its decision. 
5 
 
Elliot Trust.7  Each of these trusts is an inter vivos trust 
created by an individual who was an inhabitant of the 
Commonwealth at the time of the trust's creation, and each trust 
had become irrevocable prior to the tax year at issue.  During 
that year, none of the subject trusts had any Massachusetts 
source income that was taxable under G. L. c. 62, § 5A, and no 
identified beneficiary to whom income was payable from these 
trusts was an inhabitant of the Commonwealth.  However, it is 
undisputed that income received in relation to each of the 
subject trusts was "accumulated for unborn or unascertained 
persons, or persons with uncertain interests" within the meaning 
of G. L. c. 62, § 10 (a). 
Throughout the tax year at issue, the bank sought out and 
entered into banking and other commercial relationships, 
including making loans, with residents and with business 
entities in the Commonwealth; conducted business in no fewer 
than 200 branch offices located in the Commonwealth that were 
staffed by Commonwealth residents who were the bank's employees; 
and qualified as a "financial institution" that was "engaged in 
                     
7 During the tax year at issue, the bank was the sole 
trustee of the R.K. Elliot Trust and co-trustee of the Hovey 
Trust; U.S. Trust was the sole trustee of the Gordon Trust and 
co-trustee of the J.M. Elliot Trust. 
6 
 
business within the Commonwealth" within the meaning of G. L. 
c. 63, §§ 1, 2, 2A.8,9 
Specifically with respect to trust activities relating to 
the subject trusts, the bank performed the following activities 
in the Commonwealth during the tax year at issue:  operated and 
staffed offices for the purpose of fulfilling some of the bank's 
obligations as a trustee of those trusts; maintained 
relationships with the trusts' beneficiaries, and decided when 
to make distributions to the beneficiaries pursuant to the trust 
documents; administered the trusts' assets and retained certain 
records relating to trust administration; and conducted research 
on issues relating to the trusts and discussed such issues with 
the trusts' grantors, beneficiaries, and their representatives.  
The bank also performed certain trust-related activities in the 
Commonwealth that related to trust administration more 
generally, including consulting with clients and prospective 
clients about the bank's trust services; discussing accounts 
with grantors and beneficiaries of other trusts for which the 
                     
8 General Laws c. 63, §§ 1, 2, and 2A, relate to taxation of 
banks and other financial institutions engaged in business in 
the Commonwealth. 
 
9 The facts stated in this paragraph relate specifically to 
the bank, but the parties agree that during the tax year at 
issue, U.S. Trust conducted banking business in the Commonwealth 
and, like the bank, qualified as a "financial institution" that 
was "engaged in business within the Commonwealth" within the 
meaning of G. L. c. 63, §§ 1, 2, 2A. 
7 
 
bank served as trustee; reviewing proposed trust instruments 
with clients; and providing a place for persons to execute 
trusts that named the bank as fiduciary.  However, bank 
personnel located outside the Commonwealth also performed trust-
related activities in relation to the subject trusts, and 
"policy and procedures related to administrative and investment 
components of trusts generally were formulated by [bank] 
personnel located outside the Commonwealth."10 
 
2.  Discussion.  a.  Standard of review.  "A decision by 
the board will not be modified or reversed if the decision 'is 
based on both substantial evidence and a correct application of 
the law.'"  Capital One Bank v. Commissioner of Revenue, 453 
Mass. 1, 8, cert. denied, 557 U.S. 919 (2009), quoting Boston 
Professional Hockey Ass'n v. Commissioner of Revenue, 443 Mass. 
276, 285 (2005).  "Because the board is authorized to interpret 
and administer the tax statutes, its decisions are entitled to 
deference. . . .  Ultimately, however, the interpretation of a 
statute is a matter for the courts" (citation omitted).  Onex 
Communications Corp. v. Commissioner of Revenue, 457 Mass. 419, 
424 (2010). 
                     
10 The facts stated in this paragraph apply specifically to 
the bank, but the parties have agreed that U.S. Trust engaged in 
similar trust-related activities in the Commonwealth during the 
tax year at issue. 
8 
 
 
b.  Relevant statutes.  General Laws c. 62 generally 
concerns the taxation of income within the Commonwealth.  
Section 10, which relates to trust income, provides in relevant 
part: 
 
"The income received by trustees or other fiduciaries 
shall be taxed in the following manner: 
 
 
"(a) The income received by trustees or other 
fiduciaries described in subsection (c) of this section 
shall be subject to the taxes imposed by this chapter to 
the extent that the persons to whom the same is payable, or 
for whose benefit it is accumulated, are inhabitants of the 
commonwealth . . . .  Income received by trustees or other 
fiduciaries described in subsection (c) of this section 
which is accumulated for unborn or unascertained persons, 
or persons with uncertain interests shall be taxed as if 
accumulated for the benefit of a known inhabitant of the 
commonwealth. 
 
 
". . .  
 
 
"(c) The provisions of subsection[] (a) . . . of this 
section shall apply to . . . trustees under a trust created 
by a person or persons, any one of whom was an inhabitant 
of the commonwealth at the time of the creation of the 
trust or at any time during the year for which the income 
is computed, or who died an inhabitant of the commonwealth, 
any one of which trustees or other fiduciaries is an 
inhabitant of the commonwealth . . . ." 
As these provisions indicate, the fiduciary income tax described 
in § 10 only applies to trust income when the residency or 
inhabitance requirements for three distinct parties connected to 
the trust are met.  In particular, for the fiduciary income tax 
prescribed by § 10 (a) to be imposed, at least one grantor or 
creator of the trust, at least one or more of the beneficiaries, 
9 
 
and at least one trustee must be "inhabitants" of the 
Commonwealth. 
 
Section 1 of G. L. c. 62 contains definitions applicable to 
the chapter, including the term "inhabitant."  It provides in 
relevant part: 
 
"When used in this chapter the following words or 
terms shall, unless the context indicates otherwise, have 
the following meanings: --  
 
". . .  
 
"(f) 'Resident' or 'inhabitant', (1) any natural 
person domiciled in the commonwealth, or (2) any natural 
person who is not domiciled in the commonwealth but who 
maintains a permanent place of abode in the commonwealth 
and spends in the aggregate more than [183] days of the 
taxable year in the commonwealth, including days spent 
partially in and partially out of the commonwealth. . . . 
The word 'non-resident' shall mean any natural person who 
is not a resident or inhabitant." 
G. L. c. 62, § 1 (f) (§ 1 [f]). 
 By its terms, the definition of "inhabitant" in § 1 (f) 
refers solely to a "natural person," a term that does not 
include a corporation, such as the bank.  This leads to the 
third relevant statute, G. L. c. 62, § 14 (§ 14), which states 
in pertinent part: 
"Corporations acting as trustee or in any other 
fiduciary capacity shall, with respect to the income 
received by them in that capacity, be subject to this 
chapter in the same manner and under the same conditions as 
individual inhabitants of the commonwealth acting in 
similar capacities . . . ." 
 
 
c.  Board's decision.  Before the board, the bank and the 
commissioner defined the "sole issue presented" in the bank's 
10 
 
appeal to be whether the bank was an "inhabitant" of the 
Commonwealth within the meaning of §§ 1 (f), 10, and 14.11  
Recognizing the interplay among these three statutes, the board 
considered whether, and if so, in what manner, the definition of 
the term in § 1 (f) should be interpreted to include a 
corporation.  It first determined that in light of § 14's 
explicit directive that corporate trustees be treated the same 
as individual trustees in relation to fiduciary income tax, the 
definition of "inhabitant" in § 1 (f) should be read to apply to 
corporate trustees, and, turning to the terms of the definition, 
the board focused specifically on the terms of § 1 (f) (2).12  
Under § 1 (f) (2), a natural person who is a nondomiciliary 
qualifies as an inhabitant if he or she "maintains a permanent 
place of abode in the Commonwealth" and spends more than 183 
days per year in the Commonwealth.  To apply this definition to 
                     
11 The bank and the commissioner agreed that the subject 
trusts were created by individuals who were "inhabitants" of the 
Commonwealth at the time each created the trust, see G. L. 
c. 62, § 10 (c); the parties also agreed that income received by 
the trustees of each of these trusts during the tax year at 
issue was "accumulated for unborn or unascertained persons or 
persons with uncertain interests," and therefore was taxable "as 
if accumulated for the benefit of a known inhabitant," see § 10 
(a).  Accordingly, whether the bank was required to pay 
fiduciary income tax pursuant to G. L. c. 62, § 10, on behalf of 
the trusts in question turns on whether the bank itself 
qualifies as an "inhabitant." 
 
 
12 The board recognized that G. L. c. 62, § 1 (f) (1), with 
its requirement of domicil in the Commonwealth, could not be 
applied to the bank, given the bank's commercial domicil in 
North Carolina (and New York, for U.S. Trust). 
11 
 
a corporation, the board considered the meaning of "permanent 
place of abode," a phrase not statutorily defined.  Based on 
dictionary definitions, the board ultimately determined that "a 
corporation will qualify as an inhabitant of the Commonwealth 
within the meaning of §§ 1 (f) and 10 (c) if it maintains a 
permanent place in the Commonwealth at which it abides, i.e., 
where it continues to be and is stable in some state or constant 
in some relationship for the requisite number of days of a 
taxable year."13  The board then applied this rule to the 
underlying facts, and concluded that the bank satisfied the 
criteria to be an "inhabitant" during the tax year at issue 
through its presence and activities in Massachusetts during that 
year. 
 
d.  Bank's claims of error.  i.  "Inhabitant" requirement 
as applied to a corporate trustee.  The bank argues that because 
the definition of "inhabitant" under § 1 (f) is specific only to 
"natural person[s]," it manifestly does not include corporate 
trustees, and that the traditional criterion for imposing the 
fiduciary income tax on corporations -- that the corporation was 
domiciled in the Commonwealth -- has not been met because the 
                     
 
13 Before turning to dictionary definitions, the board 
looked to a definition of "permanent place of abode" provided in 
the commissioner's Technical Information Release 95-7 (Jan. 10, 
1996), 2 Official MassTax Guide, at PWS-82 (Thomson Reuters 
2016) (release).  The board found the release not to be relevant 
because it was clear that the release did not attempt to define 
"permanent place of abode" as it applied to corporations. 
12 
 
bank, and U.S. Trust, had their commercial domicils in States 
other than Massachusetts; at the very least, the bank contends, 
§ 1 (f) is ambiguous and the taxpayer trusts should receive the 
benefit of any such ambiguity.  The bank further argues that 
§ 14 does not require the application of § 1 (f) (2) to 
corporations.  In the bank's view, these reasons, alone or in 
combination, compel the conclusion that the fiduciary income tax 
does not apply to the subject trusts because the inhabitance 
requirement for the trustee under § 10 (c) is not satisfied.  We 
disagree. 
 
The Legislature amended the definition of "inhabitant" in 
1995 to add § 1 (f) (2) specifically to include a class of 
individuals who are not Massachusetts domiciliaries, namely, 
individuals domiciled outside the Commonwealth who maintain a 
"permanent place of abode" and spend more than 183 days in 
Massachusetts.  See St. 1995, c. 38, § 65.  Under § 14, 
corporate trustees are to be treated "in the same manner and 
under the same conditions as individual inhabitants."  Keeping 
in mind that "[t]he words of a statute must be construed in 
association with the general statutory plan," Commissioner of 
Revenue v. Wells Yachts South, Inc., 406 Mass. 661, 664 (1990), 
the board's interpretation of the definition of "inhabitant" in 
§ 1 (f) (2) as applicable to a corporate trustee was a 
reasonable one.  See generally Attorney Gen. v. Commissioner of 
13 
 
Ins., 450 Mass. 311, 319 (2008) (substantial deference given to 
reasonable interpretation of statute by agency charged with 
administrative enforcement).  This is particularly true in view 
of the specific instruction in G. L. c. 62, § 1, that when used 
in the chapter, the words defined in § 1 are to have the 
meanings set forth in that section "unless the context dictates 
otherwise."  In light of § 14's explicit directive to treat 
individual and corporate trustees the same for purposes of the 
fiduciary income tax, we agree with the commissioner that the 
requirement of § 10 (c) -- that at least one trustee of a trust 
be "an inhabitant of the commonwealth" -- provides a context in 
which the definition of "inhabitant" cannot be limited to a 
"natural person," but rather must be expanded to include a 
corporate entity.14  Cf. Springall v. Commissioner of Revenue, 
                     
 
14 Insofar as the bank asserts that, in light of the 
orientation of G. L. c. 62, § 1 (f) (2), toward individuals, 
there is no reason to interpret that portion of G. L. c. 62, § 1 
(f) (§ 1 [f]), as applying to corporations, it is significant 
that when the Legislature amended § 1 (f) in 1995 to add § 1 (f) 
(2), it did not amend G. L. c. 62, § 14 (§ 14), in any respect.  
As the commissioner points out, the directive in § 14 that for 
purposes of the fiduciary income tax, corporate trustees are 
responsible "in the same manner" as individual inhabitants 
"acting in similar capacities" has been in effect since 1916.  
See St. 1916, c. 269, § 9.  The Legislature is presumed to have 
been aware that in broadening the definition of "inhabitant" in 
1995 by adding § 1 (f) (2), the expanded definition would also 
apply to corporate trustees through § 14.  See, e.g., Boston 
Water & Sewer Comm'n v. Metropolitan Dist. Comm'n, 408 Mass. 
572, 578 (1990) ("the Legislature is presumed to understand and 
intend all consequences of its acts" [quotation and citation 
omitted]). 
14 
 
391 Mass. 23, 25 n.2 (1984) ("Surely, the Legislature did not 
intend to treat a trust differently for the purposes of G. L. 
c. 62, § 9, depending on whether a fiduciary was a natural 
person or a corporation").  To read § 14 as not imposing this 
requirement on corporations would be essentially to deprive the 
section of meaning, an undesirable result.  See, e.g., Volin v. 
Board of Pub. Accountancy, 422 Mass. 175, 179 (1996) ("We do not 
interpret a statute so as to render it or any portion of it 
meaningless" [quotation and citation omitted]).  We therefore 
reject the bank's argument that, in connection with its 
activities as a trustee of the subject trusts, it cannot be 
subject to the fiduciary income tax imposed under § 10 solely 
because it is not domiciled in Massachusetts. 
 
ii.  The bank's presence and activities in the 
Commonwealth.  The bank further argues that, even if § 1 (f) (2) 
applies to corporations, the board erred by creating and 
applying a "presence and activities test" to determine whether 
the bank met the criteria set forth in § 1 (f) (2).15  In the 
                     
15 In ruling that the bank qualified as an inhabitant of the 
Commonwealth during the tax year at issue, the board pointed to 
the bank's "numerous and substantial activities" in the 
Commonwealth during the tax year at issue, referencing the 
parties' agreed-upon facts about (1) the general commercial 
activities conducted by the bank in the Commonwealth, (2) the 
bank's Commonwealth-centered activities relating specifically to 
the four appellant trusts, and (3) the bank's activities in the 
Commonwealth relating to trust administration and development of 
trust administration business more generally.  The bank refers 
15 
 
bank's view, the test treats corporate trustees less favorably 
than individual trustees, in violation of § 14's mandate that 
they be treated "in the same manner."  Specifically, the bank 
asserts that in relation to individual trustees, the test under 
§ 1 (f) (2) is narrow, requiring such trustees to have a 
substantial personal nexus to Massachusetts, whereas the same is 
not required of corporate trustees.  Thus, the argument goes, an 
individual trustee who is not a Massachusetts domiciliary must 
spend more than half the tax year in the Commonwealth to qualify 
as an inhabitant, making it unlikely that he or she would be 
deemed an inhabitant or resident of more than two States; but a 
corporate trustee, however -- at least under the board's 
presence and activities test -- could be treated as an 
inhabitant of the Commonwealth for purposes of the fiduciary 
income tax under § 10 if the trustee maintains a single office 
in Massachusetts for more than one-half year, regardless of 
whether the corporation conducts any trust administration 
activities here.  The bank suggests a more narrow test for a 
corporate trustee, such as one that turns on whether there is a 
predominant corporate presence in Massachusetts, which might be 
measured by the location of employees, or the location of 
assets, or the source of corporate revenue.  In the alternative, 
                                                                  
to the board's reference to all these activities as the board's 
"presence and activities test." 
16 
 
the bank argues that we should adopt the type of test that the 
bank suggests the commissioner previously suggested to the 
board:  that corporate trustee inhabitance and, in turn, 
fiduciary income tax liability should be focused on whether the 
trustee's administration of the particular trusts at issue takes 
place within Massachusetts.  The bank suggests that, under such 
a standard, it is unclear whether the bank would be subject to 
the fiduciary income tax in relation to the subject trusts 
because, as the board found, some of the bank's trust 
administration activities were conducted outside the 
Commonwealth. 
 
We do not share the bank's view that for the purpose of 
assessing the inhabitance of a corporate trustee, the board has 
created a formal "presence and activities" test that focuses on 
the corporation's general business presence in the Commonwealth.  
Rather, we understand the board to have evaluated the specific, 
agreed-upon facts presented and to have reached its conclusion 
that the bank qualified as an inhabitant of the Commonwealth 
based on those facts -- facts that included that, in terms of 
Massachusetts-based activities, the bank both conducted general 
banking transactions, maintaining over 200 branch offices 
staffed by bank employees, and performed work as a corporate 
trustee of the particular trusts at issue here.  With respect to 
the latter, the board found that the bank: 
17 
 
"operated and staffed offices to fulfill some of their 
obligations as trustees of the [subject] Trusts; maintained 
relationships with the beneficiaries of the [subject] 
Trusts and . . . decided when to make distributions of 
trust assets to beneficiaries; administered the assets of 
the [subject] Trusts; consulted with clients and 
prospective clients [of other trusts] about [the bank's] 
trust services; . . . provided places for execution of 
[other] trusts which named [the bank or U.S. Trust] as 
fiduciary; and researched and discussed issues involving 
the [subject] Trusts and discussed such issues with 
grantors, beneficiaries and/or their representatives." 
 
 
The bank points to the language of § 14 providing that a 
corporate trustee will "be subject to [the fiduciary income tax 
provisions of G. L. c. 62] in the same manner and under the same 
conditions as individual inhabitants of the commonwealth acting 
in similar capacities" (emphasis added).  We agree with the bank 
that the quoted language from § 14 requires a focus on the 
actions within the Commonwealth of a corporation acting as a 
corporate trustee, including specifically acting as trustee of 
the trust or trusts potentially subject to fiduciary income tax 
liability, and not just on the corporation's general business 
activities.  Put more generally, we interpret the three 
interrelated statutes that apply in this case, §§ 1 (f) (2), 10, 
and 14, to mean that a corporate trustee will qualify as an 
"inhabitant" of the Commonwealth within the meaning and for the 
purposes of these statutes if it:  (1) maintains an established 
place of business in the Commonwealth at which it abides, i.e., 
where it conducts its business in the aggregate for more than 
18 
 
183 days of a taxable year; and (2) conducts trust 
administration activities within the Commonwealth that include, 
in particular, material trust activities relating specifically 
to the trust or trusts whose tax liability is at issue. 
 
We conclude that the board's decision in the present case 
is consistent with this interpretation of statutory 
requirements.  It concluded in effect that for a corporate 
trustee such as the bank to be deemed an inhabitant under § 1 
(f) (2), there must be proof that the corporation has an 
established presence in the Commonwealth through, e.g., 
maintaining a permanent office or offices in Massachusetts and 
engaging in regular business activities here, for more than one-
half of the tax year at issue.  Such a presence corresponds to 
the presence of an individual inhabitant at a permanent place of 
abode for more than 183 days in a year.  Certainly the agreed-
upon facts establish that the bank met this requirement.  But as 
the portion of the board's decision quoted supra shows, the 
board did not stop with the bank's general corporate activities 
within the Commonwealth.  Rather, the board considered the 
Commonwealth-centered activities conducted by the bank in its 
capacity as corporate trustee, including activities that were 
centered on the subject trusts.  And we agree with the board 
that the bank's activities relating to administration of the 
subject trusts demonstrate the bank's material and specific 
19 
 
trust-related nexus to Massachusetts for more than 183 days of 
the tax year at issue.  Accordingly, the board did not err in 
ruling that the bank was subject to the fiduciary income tax 
imposed by § 10.16 
 
iii.  Dormant commerce clause.  Finally, the bank argues 
that the board's decision, and in particular its interpretation 
of § 1 (f) (2) as applying to the bank, "raises serious 
questions" under the dormant commerce clause of the United 
States Constitution.  See art. I, § 8, cl. 3, of the United 
States Constitution.17  The bank did not raise a constitutional 
claim before the board, and to the extent it seeks to do so 
here, we consider the claim to be waived.18  See G. L. c. 58A, 
                     
 
16 The bank argues further that the board's presence and 
activities test violates fundamental principles applicable to 
the interpretation of Massachusetts statutes, including that the 
test puts a premium on corporate structure, discourages 
companies from establishing or acquiring offices in 
Massachusetts, and places an unreasonable administrative burden 
on national banks. There is no evidence in the record to support 
these assertions. 
 
 
17 The bank states specifically in its reply brief that it 
"does not claim that [§ 1 (f) (2)] violates the [d]ormant 
[c]ommerce [c]lause either facially or as applied here."  
Rather, it makes the argument to persuade us "to adopt a reading 
of [§ 1 (f) (2)] that avoids constitutional doubts across the 
sweep of [the section's] reasonably foreseeable applications." 
 
 
18 The bank did not raise any argument under the dormant 
commerce clause before the board and the board made no rulings 
with regard to the dormant commerce clause as applied to the 
facts on record before it.  Indeed, the bank specifically stated 
in its reply brief to the board that it "did not argue the 
specter of multistate taxation as a basis for relief" and that 
20 
 
§ 13 ("The court shall not consider any issue of law which does 
not appear to have been raised in the proceedings before the 
board").  See also Minchin v. Commissioner of Revenue, 393 Mass. 
1004, 1005 (1984),quoting New Bedford Gas & Edison Light Co. v. 
Assessors of Dartmouth, 368 Mass. 745, 752 (1975) ("To raise a 
constitutional question on appeal to this court from the board, 
the taxpayer must present the question to the board and, in so 
doing, make a proper record for appeal. Otherwise, the taxpayer 
waives the right to press the constitutional argument").19 
 
3.  Conclusion.  The decision of the Appellate Tax Board is 
affirmed. 
 
 
 
 
 
 
 
So ordered. 
                                                                  
"there is no constitutional issue raised in this matter."  The 
bank's argument below -- that, if other States were to follow 
Massachusetts's lead in taxing fiduciary income on the basis of 
a corporation's residence in those States, it could lead to 
"potential constitutional implications" -- was insufficient to 
raise a particularized claim of error warranting review by this 
court under the dormant commerce clause. 
 
 
19 Although this case does not require us to consider a 
dormant commerce clause challenge to § 1 (f) (2) or the related 
statutory provisions governing the fiduciary income tax, it 
bears pointing out that (1) under G. L. c. 62, § 6 (a), an inter 
vivos trust subject to the fiduciary income tax in Massachusetts 
would be entitled to a credit for any taxes paid with respect to 
that income to another State; and (2) for such a trust to be 
subject to the fiduciary income tax here, not only must the 
corporate trustee be an inhabitant of the Commonwealth, but so 
must the creator of the trust as well as at least one 
beneficiary.  See G. L. c. 62, § 10 (a), (c).