In the 1906 case of Chanler v. Kelsey, Comptroller of the State of New York, the U.S. Supreme Court dealt with a dispute over inheritance tax law in New York state. The plaintiff, William Astor Chanler, was an heir to John Jacob Astor III's estate and contested that he should not be taxed on his inherited property because it had been transferred to him before death by means of a trust fund created by Mr. Astor in 1873 - prior to enactment of any inheritance tax laws in New York (1892). However, upon Mr. Astor’s death in 1890, control over this trust passed onto Chanler which led authorities to levy taxes as per new laws enacted after creation of said trust but before its transferal due to demise. The court ruled against Chanler stating that although no specific provision existed for such situations when these laws were first introduced; subsequent amendments clarified their applicability retrospectively covering all transfers made within contemplation or intended evasion thereof regardless if they occurred pre-enactment or post-enactment respectively.

In the dissenting opinion for Chanler v. Kelsey, Comptroller of the State of New York, Justice Harlan disagreed with the majority's decision that a tax on legacies and distributive shares was constitutional. He argued that this type of taxation was not within Congress' power to impose direct taxes apportioned among states according to their population as outlined in Article I, Section 9 of the Constitution. Instead, he believed it fell under indirect taxation which is subject to uniformity across all states per Article I, Section 8. Furthermore, he contended that such a tax violated citizens' right to transfer property upon death without governmental interference - an inherent privilege protected by law from arbitrary infringement or suppression by government authority. Therefore, Justice Harlan concluded that this form of inheritance tax was unconstitutional and should be struck down.