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Ensuring Florida is Deemed Your Domicile

June 1, 2010 Articles Tax

So you have moved or retired to warm, sunny Florida and made a new “home” – or have you? The technical answer to this question is significant, as it can affect your estate planning, tax liabilities, and other financial matters. Each year, thousands of people relocate to Florida, intending to make the Sunshine State their “legal residence” or “domicile.” (These terms are often used interchangeably, and this article will use “domicile.”) But simply owning a home in Florida is different than becoming domiciled in Florida.

Your Intent is Key
Under Florida law, intent is a key factor in determining a person’s state of domicile. A court will actually evaluate and examine an individual’s real attitude and intention, as demonstrated by his or her actions and conduct. So, once you settle in Florida, if it truly is your intent to make Florida your “home,” there are affirmative steps you can take to demonstratively declare Florida as your domicile.

Make Your Intent Clear Through Your Actions: Take Affirmative Steps
Keep in mind that no single act determines a person’s domicile, and you should consider taking as many of the following steps as possible to ensure Florida is recognized as your domicile:

File a Florida “Declaration of Domicile.” This is a sworn statement, prepared and filed in the office of the clerk of the circuit court for the county in which you reside, evidencing an intention by you to state that Florida is your permanent and principal home.

Purchase Real Property in Florida. If practical, consider the purchase of real property, especially the house or condominium in which you reside as your primary residence.

File for Florida’s Homestead Exemption. If you own a Florida house or condominium in which you are living as your primary residence, consider proper notification to your prior state of any change of homestead status granted therein.

Obtain a Florida Driver’s License. Consider surrendering the driver’s license issued by your former home state – otherwise, Florida may issue a limited use license, valid only in Florida, and this may cause uncertainty whether Florida is truly your domicile.

Register Automobiles in Florida. Register your automobile in Florida and obtain Florida tags.

Register to Vote. Register to vote in Florida. This registration is done in the Elections Supervisor’s office for the county in which you reside.

File Federal Income Taxes in the Region for Florida. File your federal income taxes from your Florida address and send to the regional office for the State of Florida (the IRS Service Center in Atlanta, Georgia).

Establish Club and Church Affiliations in Florida. Become a member of clubs, churches and other organizations in Florida.

Live in Florida Most of the Year. You should spend the greater percentage of each year in Florida.

Obtain Florida Bank Accounts and Safe-Deposit Boxes. You should establish banking relations in Florida.

File Non-residency Returns in Former State. If you are still required to file state income tax returns in another state, those returns should be filed as a non-resident.

Recite Florida as Your Domicile in Estate Planning Documents. Consider revising your estate planning documents, not only to recite Florida as your domicile, but to ensure compliance with Florida law.

Recognize that the Law Permits Only One Legal Residence
It is important to note that a person cannot have more than one legal residence. If it is your intent to make Florida your new domicile, it follows that you are terminating residency in your former home state. This does not mean that you must sever all ties with your former home, but it does require that you shift some of your main ties to Florida.

Consider Some of the Practical Effects of Choosing Florida
As mentioned above, your tax liabilities, estate planning, and other financial matters can be affected by your choice of domicile. For example, Florida has no state income tax. Additionally, those domiciled in Florida may benefit from Florida’s homestead exemption, which offers a variety of benefits including potential savings related to property taxes and potential creditor protection.

Choosing Florida as a permanent residence may also impact your estate planning. Florida has no estate tax. Further, only if you are domiciled in Florida at the time of your death is it appropriate to open the primary administration of your estate in Florida. If the probate administration of your estate takes place in Florida, then beneficiaries of your estate may pursue certain Florida benefits pursuant to Florida Statutes including spousal elective share, life-estate homestead rights, and the family allowance.

Keep in mind that your former “home” state may lose potential tax revenue if you choose Florida as your domicile. If you move from a state that collects a state income tax or estate tax, that state may experience a loss of revenue, giving it reason to investigate and seek evidence related to the new domicile.

Bottom Line
In Florida, the determination of domicile is based on an analysis of facts and circumstances. You don’t want there to be confusion if there comes a time when a determination of your domicile is required. If your intent is to make Florida your legal residence, you will want your intent – as proven through your outright acts – to be clear and documented so that your intent will be honored.