This section contains the nature of the case and procedural background.

O'Shaughnessy (D) was the beneficiary of two separate trusts established by his grandparents. The Trust agreement allowed the trustees in their discretion to distribute the principal and income of the trust to the beneficiaries and to invade the corpus at their sole discretion as well as to withhold benefits entirely. D also had a limited power of appointment exercisable only by his last will and testament to a certain class of individuals. If D died without exercising his power of appointment the trust called for distribution of the principal and undistributed income at his death. In October 1989, the Secretary of the Treasury assessed a $412,921.27 federal income tax deficiency against D. The United States (P) filed suit in for a lien on all of D's property and the issue of whether the trust was D's property was put before the court. The United States District Court certified the question to the Minnesota Supreme Court.

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