EXHIBIT 3.2
Chapman and Cutler LLP
111 West Monroe Street
Chicago, Illinois 60603
January 28, 2015
Guggenheim Funds Distributors, LLC
2455 Corporate West Drive
Lisle, Illinois 60532
The Bank of New York Mellon
2 Hanson Place
Brooklyn, New York 11217
Re: Guggenheim Defined Portfolios, Series 1272
Global Balanced Income Builder Portfolio, Series 5
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Ladies/Gentlemen:
We have acted as counsel for Guggenheim Funds Distributors, LLC, depositor
of Guggenheim Defined Portfolios, Series 1272 (the "Fund"), in connection with
the issuance of units of fractional undivided interest in the Fund (the
"Units"), under a trust agreement dated January 28, 2015 (the "Indenture") among
Guggenheim Funds Distributors, LLC, as sponsor (the "Sponsor"), as depositor
(the "Depositor") and evaluator (the "Evaluator"), and The Bank of New York
Mellon, as trustee (the "Trustee"). The Fund is comprised of the following unit
investment trust: Global Balanced Income Builder Portfolio, Series 5 (the
"Trust"). This opinion applies only to the Trust. Holders of beneficial
interests in the Trust are referred to herein as the "Unitholders."
In this connection, we have examined the registration statement and the
prospectus for the Fund (the "Prospectus"), the Indenture, and such other
instruments and documents, as we have deemed pertinent (the "Transaction
Documents"). For purposes of this opinion, we are assuming that the Trust will
at all times be operated in accordance with the Indenture and the Prospectus and
that the parties to the Indenture will at all times fully comply with the terms
of the Indenture. Failure to operate the Trust at all times in accordance with
the Indenture and the Prospectus or failure to comply fully at all times with
the terms of the Indenture could result in tax treatment different from that
described below.
You have informed us, and we are assuming, that the assets of the Trust
will consist of a portfolio as set forth in the Prospectus. All of the assets of
the Trust constitute the "Trust Assets." You have not requested us to examine,
and accordingly we have not examined, any of the Trust Assets and express no
opinion as to the Federal income or state tax treatment thereof.
The Transaction Documents include certain representations by the Depositor
and the Trustee with respect to which we have no independent knowledge and have
done no independent investigation. Such representations include, without
limitation, that: (i) the Trust will acquire and hold the Trust Assets solely
for the account of the Unitholders; (ii) the activities of the Trust will
consist of the investment of funds in the Trust Assets, the collection of the
income and proceeds from such investments, and the incidental replacement of
Trust Assets and temporary reinvestment of proceeds under limited and specified
circumstances; and (iii) the Trust has not and will not (a) establish an office,
(b) hire employees, or (c) conduct any acts not permitted by the Indenture.
Based upon the foregoing and assuming the accuracy of the aforementioned
representations and assumptions on the date hereof as well as continuing
satisfaction of such representations and assumptions, and based upon an
investigation of such matters of law as we consider to be applicable:
(i) We are of the opinion that, under existing United States Federal
income tax law, the Trust is not an association taxable as a corporation for
Federal income tax purposes but will be classified as a grantor trust and will
be governed by the provisions of subpart E of Part I of subchapter J (relating
to trusts) of chapter 1, of the Internal Revenue Code of 1986 (the "Code").
(ii) Section 671 of the Code provides that, where a trust grantor is
treated as the owner of any portion of a trust, there shall then be included in
computing the taxable income and credits of the grantor those items of income,
deductions and credits against tax of the trust which are attributable to that
portion of the trust to the extent that such items would be taken into account
under the Code in computing taxable income or credits against the tax of an
individual. Each Unitholder is treated as the owner of a pro rata portion of the
Trust under Section 676 of the Code. Therefore, a Unitholder will be considered
as owning a pro rata share of each of the Trust Assets in the proportion that
the number of Units held by him or her bears to the total number of Units
outstanding. We are of the opinion that, under existing United States Federal
income tax law, (a) under subpart E, subchapter J of chapter 1 of the Code,
income of the Trust will be treated as income of each Unitholder in the
proportion described above, and an item of Trust income will have the same
character in the hands of a Unitholder as it would have if the Unitholder
directly owned a pro rata portion of the Trust's assets and (b) each Unitholder
will be considered to have received his or her pro rata share of income derived
from each Trust asset when such income would be considered to be received by the
Unitholder if the Unitholder directly owned a pro rata portion of the Trust's
assets.
(iii) Although the discussion in the Prospectus under the heading "Taxes"
does not purport to discuss all possible United States federal income tax
consequences of the purchase, ownership and disposition of Units, in our
opinion, under existing United States Federal income tax law, such discussion,
taken as a whole, is an accurate summary in all material respects, to the extent
that the discussion constitutes statements of law or legal conclusions with
respect to United States federal income tax matters. In this regard, please note
that (a) we have not examined any of the Trust Assets and we are therefore
unable to express an opinion, and we express no opinion as to the federal income
tax treatment thereof and (b) the discussion under "Taxes" depends in part on
the facts peculiar to individual Unitholders of which we have made no
investigation and have no knowledge.
(iv) Based solely upon the existing laws of the State of New York and The
City of New York, administrative interpretations thereof and court decisions as
of the date hereof, we are of the opinion that (a) the Trust will not be subject
to the New York State franchise tax imposed on domestic and foreign corporations
by Article 9-A of the New York State Tax Law; (b) the Trust will not have
taxable income subject to the New York State personal income tax imposed by
Article 22 of the New York State Tax Law; (c) the Trust will not be subject to
the unincorporated business tax imposed by Section 11-503 of the Administrative
Code of The City of New York (the "Administrative Code"); (d) the Trust will not
be subject to the general corporation tax imposed by The City of New York on
domestic and foreign corporations under Section 11-603 of the Administrative
Code; and (e) the Trust will not have taxable income subject to the personal
income tax imposed by The City of New York under Section 11-1701 of the
Administrative Code.
Our opinion is based on the Code, the New York State Tax Law, the
Administrative Code, the regulations promulgated thereunder and other relevant
authorities and law, all as in effect on the date hereof. Consequently, future
changes in such laws, the regulations promulgated thereunder and other relevant
authorities and law may cause the tax treatment of the transaction to be
materially different from that described above. This opinion is given as of the
date hereof, and we undertake no, and hereby disclaim any, obligation to advise
you of any change in any matter set forth herein. Our opinion represents only
our legal judgment, is not a guarantee of a result and, unlike a tax ruling, is
binding neither on the Internal Revenue Service, the New York state or city
taxing authorities nor a court of law, and has no official status of any kind.
The Internal Revenue Service, the New York state or city taxing authorities or a
court of law could disagree with the opinion expressed herein. Although we
believe that, in a properly presented case, the opinion expressed herein would
be found to be correct if challenged, there can be no assurance that this will
be the case. In evaluating these tax issues, we have not taken into account the
possibility that a tax return will not be audited, that an issue will not be
raised on audit, or that an issue will be resolved through settlement if raised.
This opinion, as qualified herein, covers only the opinions expressly
contained herein, and we express no opinion with respect to any other
considerations which may arise relating to the transaction, any other taxes or
any other matters arising under United States Federal, state, local or foreign
law.
The Committee on Legal Opinions of the American Bar Association
promulgated the "Third-Party Legal Opinion Report, Including the Legal Opinion
Accord," (the "ABA Guidelines") in 1991. Among other things the ABA Guidelines
provide that attorneys should not provide legal opinions as to matters of fact
or financial or economic forecasts (or similar predictions). In this regard,
matters discussed expressly or implicitly within this letter which are
determined to be matters of fact or financial or economic forecasts (or similar
predictions) should be interpreted to be a confirmation of our understanding and
a statement of our belief rather than a legal opinion, regardless of the
language used.
Chapman and Cutler LLP does not and will not impose any limitation on the
disclosure of tax treatment or tax structure of any transaction relating to this
matter.
We hereby consent to the filing of this opinion as an exhibit to the
registration statement (File No. 333-200590) relating to the Units referred to
above and to the use of our name and to the reference to our firm in said
registration statement and in the related Prospectus.
Very truly yours,
/s/ Chapman and Cutler LLP
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CHAPMAN AND CUTLER LLP