Screen a trust for U.S. tax residence under the court and control tests
Key facts
- Human involvement
- YellowClose supervision
- How AI is used
- Ask two questions from the instrument and the facts: whether a court within the United States can exercise primary supervision over the administration of the trust, and whether one or more United States persons can control all substantial decisions. Both are required.
- What the lawyer must review
- 26 U.S.C. § 7701(a)(30)(E) treats a trust as a United States person only if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons have the authority to control all substantial decisions of the trust. The IRS classification page states the same two conditions. A trust that fails either condition is not in that United States-person paragraph. The IRS page points to section 7701(a)(31) for the definition of a foreign trust.
- Written for / version
- United States versionUS
Who does what
| Role | What they do |
|---|---|
| Assistance | Do not begin AI assistance until the responsible lawyer has defined and confirmed its permitted scope. |
| Lawyer | Set the scope, supervise the work closely, verify every part relied on, resolve omissions and exceptions, and approve the exact output. |
Checklist
- Open each relied-on authority independently. Confirm its existence, current status, proposition and any quotation or pinpoint reference.
- Confirm the output against the client’s instructions and the complete relevant source material, including omissions or contradictions.
- Resolve exceptions and record the responsible lawyer’s approval of the exact output and intended use.