Question: I understand there are some real benefits to making Florida my domicile. Can you highlight some of those benefits and explain domicile?
Answer: Florida domicile has been defined by the courts as “the permanent residence of a person or the place to which he intends to return even though he may actually reside elsewhere his home, as distinguished from place to which business or pleasure may temporarily call him.” It is one’s primary residence and not always the residence where a person resides a majority of the time. It is comparable to a sailor’s home port.
As confirmed in the bankruptcy case of In re: Morad, the courts do not simply perform a mathematical test of adding up days of physical presence to determine domicile. Florida domicile is attractive for a number of reasons. One is that Florida has no state income tax. If you are a Florida domicile, you likely avoid state income tax on your investments and wages. Domicile can also qualify your primary residence as Florida homestead. If you make the appropriate filing with the Property Appraiser’s office, your homestead is eligible for exemption of up to $50,000 in assessed value from property taxes, additional exemptions for widows and widowers and disabilities and a cap on annual increase on assessed value for tax purposes equal to the lessor of three percent or change in the Consumer Price Index. In addition, Florida domicile brings with it protection from creditor claims against homestead, wages, retirement accounts and annuities which are not generally available in other states or under Federal law. These benefits can make establishing Florida domicile quite valuable.
Establishing domicile is largely a question of intent and is based upon all relevant facts. The bottom line for decision is does the person claiming domicile intend and act like Florida is his or her primary residence? If dispute arises, the court may consider the following factors:
1. The amount of time you spend at your Florida residence compared to any other residence?
2. Are your motor vehicles and boats titled and licensed in Florida?
3. Are you registered to vote in Florida?
4. Are your personal financial in Florida banks or institutions where you deal with local offices?
5. What address is referenced on you Federal Income Tax Return?
6. Do you use your Florida address for all documents and as mailing address for statements, magazines and other?
7. If you pay income taxes on income in another state, do you file as a “non- returning Florida resident?”
8. Have you filed with the Property Appraiser’s office for the Florida homestead tax exemptions?
9. Have you retained a new attorney, accountant, physician, dentist and other professionals in Florida?
10. Do you have a Florida’s driver’s license?
11. If conducting business, is the majority of that business conducted in Florida?
12. Are you club memberships Florida based?
13. Are you active in any local Florida based organizations?
14. Did you ever advise the Post Office to forward your mail to your Florida address?
15. Do your estate planning documents reference you are a Florida resident?
16. Have you taken any other action consistent with making Florida your primary residence?
In addition to the above, you can file a Declaration of Domicile with the Clerk of Courts. The legislature adopted a statute providing for filing a Declaration of Domicile to benefit people moving to Florida from states that might make a claim to income or other taxes. It can be a particularly valuable instrument when Florida residents maintain a home in another state, especially one that is tax aggressive.
Domicile disputes usually involve tax claims by another state or efforts by a creditor to avoid Florida’s exemptions from creditor claims. Such disputes are best avoided by planning before a tax or creditor claim is made. I would suggest you discuss these matters with your attorney for further clarification.
William G. Morris is an attorney with offices at 247 North Collier Boulevard on Marco Island, Florida. His practice covers a broad range of subjects, including civil litigation, real estate, business and corporate law, estate planning and probate, domestic relations and contracts. He writes this column periodically with respect to legal matters that frequently affect non-lawyers. The information contained in this column is not intended as legal advice and, of necessity, is generalized. For questions about specific circumstances, the reader should consult a qualified attorney.
Questions for this column can be sent to: William G. Morris, e-mail: email@example.com or by fax, (239) 642-0722.
Other articles of interest can be viewed at our website, www.wgmorrislaw.com.