In the case of Osborne v. Clark in 1906, the U.S. Supreme Court ruled on a dispute involving inheritance tax law and its application to property located outside of the United States. The decedent was a resident of New York at his time of death but owned stocks in corporations based both within and outside the U.S., including England, Canada, and Mexico. His executor argued that only those stocks from companies incorporated within America should be subject to taxation under New York state law. The court disagreed with this argument stating that all personal property held by an individual is deemed to be located at their place of residence for purposes related to succession taxes unless explicitly exempted by statute or treaty provisions. Therefore, it upheld that all stock holdings regardless of where they were incorporated were liable for taxation under New York's inheritance tax laws as they belonged to a resident domiciled there during his lifetime.

In the dissenting opinion for Osborne v. Clark, Justice Harlan disagreed with the majority's interpretation of the tax law in question. He argued that Congress intended to tax all dividends paid by a corporation out of its profits accumulated since March 1, 1864, regardless of when those profits were actually realized or distributed. According to him, it was irrelevant whether these dividends were derived from earnings made before or after this date; what mattered was that they were part of a company’s profit pool at any point after this time frame and thus should be subject to taxation accordingly. Therefore, he believed that Mr. Clark should have been taxed on his entire dividend income rather than just a portion as decided by the court majority.