The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought.
Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely. The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.
Careful documentation is of the following is key: Note the date of your change of residence Document in writing the reason for the change in residence which shows basis and intent i. Contact us. Learn More arrow Created with Sketch. Article Tags featured. Later in , he sold his apartment in New York City and moved to the Hamptons. Fortunately, the taxpayer was able to convince the New York Division of Tax Appeals that his domicile for and was, indeed, Dallas. As it turned out, the tipping point came when the taxpayer moved his dog to Dallas in November By taking the dog to Dallas, the taxpayer demonstrated that Dallas was officially his new home.
Planning to move to a new state with lower taxes? Unless you establish domicile in the new state and terminate residency in the old one, you could come under scrutiny by state tax authorities. Your tax advisor can explain the rules in your old and new states and how to avoid potential pitfalls. Skip to content. You end up in New Mexico, where you've been living for the past year.
You're not sure you'll stay there—California beckons—but for now, it's your home. You're a New Mexico resident. Note: This example isn't obvious. The key is the word "moved"—you abandoned your previous state to move west—combined with New Mexico residency laws.
A perfect example of why you should always defer to your state's residency rules if you're ever in doubt. Nonresident examples For tax purposes, you are a nonresident of a state if you temporarily worked there with no intention of making it your home or you received income from sources in that state, such as rental property.
Examples You live in Colorado and work during the winter as a ski guide. In summer, you work as a rafting guide in neighboring Utah. You'll need to file a Utah nonresident return, in addition to your Colorado return, so you can report your summer income to Utah. You live in California and own a rental in Arizona. The Department of Revenue presumes that a person is a resident of this state if he or she does any of the following:.
Persons may rebut the presumption of residency if they provide other facts which show that they do not intend to reside in this state on either a temporary or permanent basis.
A Washington resident who intends to move at a future date, however, will be considered a Washington resident.
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