From Empire State to Sunshine State: Why your Domicile Matters

January 23, 2019

There are many reasons why a New Yorker who spends time in Florida may want to change their domicile from New York to Florida. Aside from the beautiful beaches and sunny weather – some reasons include health problems, a new job, family and taxes.

Yes, taxes can be an important factor when deciding to change domiciles especially when comparing New York to Florida. New York has both an income and estate tax while the sunshine state has neither. Heavy tax burdens can make a big difference in a family’s financial situation, especially if the family is on a fixed income. As a result of the recent repeal of the state and local tax deduction, more and more people are considering making the switch to Florida.

What is Domicile?

Traditionally, the common law defines an individual’s domicile as “living in a particular locality with intent to make it a fixed and permanent home.” There are essentially two elements that must be shown to prove a change of domicile: 1.) abandonment of the old domicile and procurement of a new domicile; and 2.) actual change of residence.

Why Does Domicile Matter?

Where your domicile is located will determine which state tax laws you will be subject to. The law seems straightforward but court decisions vary widely depending on the facts of each case. If you simply claim to be a domiciliary of Florida while your behavior indicates otherwise you may still be on the hook for taxes in New York. Likewise if you oscillate from New York and New Jersey (another state that imposes state income tax) and it is unclear where your domicile is located you may be subject to taxes in both states. Therefore, it is important to take the necessary steps to help ensure that you are no longer considered a domiciliary of New York if your goal is to make Florida your home.

What can I do?

A person looking to change domicile should take certain steps to help prove the change by clear and convincing evidence. To demonstrate the intent necessary to change domicile from New York to Florida, a person should take the following actions:

  • Lease or own and occupy a dwelling in Florida.
  • Apply for a homestead exemption provided only to residents of Florida.
  • Spend a significant amount of time in Florida, ideally, at least six months and a day.
  • File a copy or a “Declaration of Non-Domicile” with New York and File a Declaration of domicile in the office of the circuit court in the county of residence.
  • Sign estate planning documents to ensure such documents comport with and are governed by Florida law. The estate planning documents should state that the person is a resident of Florida.
  • Register to vote in Florida and vote in Florida elections. Cancel voter’s registration in New York.
  • Open bank accounts in Florida.
  • Register boats, automobiles, and airplanes in Florida.
  • Obtain an “unrestricted” Florida driver’s license as well as a Florida boater’s license (if necessary).
  • File a final individual income tax return in New York using the new Florida address on the return and File federal income tax returns with the IRS in the Atlanta Service Center using the person’s Florida address.
  • Update address on insurance policies to the person’s Florida address.
  • Update religious and social memberships to affiliations or branches in Florida and register as a non resident member with such organizations in New York.
  • Do not request discounts available only to residents of New York, such as reduced school tuition rates or New York senior citizen discounts.

Hire an attorney licensed in Florida

Once you have taken the necessary steps to change your domicile to Florida, contact OC Estate & Elder Law at (954) 251-0332 or to learn how effective estate planning can help provide you peace of mind and protect your assets.