NYS Nonresidents and Domicile

Taxpayers are often motivated to change their residency from a state with high tax rates to a states with low rates. While it may be in the taxpayers best interests to leave, it is in the state’s best interest to keep them here. Taxpayers that seek to move out of New York while maintaining ties to the state face the issue of domicile. Consider these rules:

  • If you are domiciled in New York State and you spend more than 29 days in the state you pay taxes as a resident.
  • If you are not domiciled in New York you can spend up to 183 days in the state and still avoid paying taxes as a resident.

As far as New York State is concerned, once you are domiciled in the state you will remain domiciled in the state until you prove that you have changed it. Taxpayers who buy a house in a another state, get a new drivers license and register to vote might be surprised to learn that these actions do not necessarily establish change of domicile. In fact, it is not necessary to own a home or lease an apartment to be considered domiciled in New York. What matters to the tax department is intent. In other words, where do you intend to live? Some factors to consider:

  • Where do you keep your belongings?
  • Where do you work?
  • Where does your family live?
  • Where do your friends live?
  • What church do you regularly attend?
  • Where do your social activities take place?

A final thing to consider for the “snowbirds”. A snowbird is a term used to describe an individual that leaves the colder New York temperatures in the winter for the warmer climate of Florida. From a tax standpoint, Florida is desirable because there is no state income tax. Let’s assume that after following the snowbird pattern for a few years, a taxpayer decides that they are now Florida residents and file their tax return as a New York non-resident. In this case, the snowbird pattern can work against the taxpayer. The taxpayer needs some other significant change in their life in order to support a change of domicile.

For more information, contact our office.

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