Are You Considering Change of Residency?

From October to April Florida’s population increases on average by 5% as many “northerners” travel south to “winter” in Florida. Like other “northern” states, this is especially true of Minnesotans. While some of these MN Snowbirds are official residents of Florida, many are non-Florida residents who may be asking themselves whether the benefits of changing their residency from Minnesota to Florida outweighs the costs. If you are one of these individuals, then you should also consider some additional “costs” of changing and maintaining your “domicile” in Florida.

In its opinion in Zauhar v. Commissioner of Revenue (9139-R, Minn. Tax Ct. 2020),  the Tax Court of Minnesota provided some of the clearest guidance on establishing domicile. The Court made it clear that “domicile” and “residency” are distinctly different. An individual may have “residency” in more than one state. On the other hand, an individual may only have one “domicile” (i.e., where you call home). One of the main takeaways from the Zauhar case is the focus on whether an individual has intentionally established domicile in another state and not whether they have affirmatively abandoned their domicile in Minnesota.

If you are evaluating whether to establish a domicile outside of Minnesota, then you should evaluate your circumstances against the factors listed in Minn. R. 8001.0300 to determine whether to claim domicile somewhere outside of Minnesota. Some of the most well known factors include:

  • Physical location;
  • Voting registration;
  • Tax reporting address;
  • Statements made to insurance company for underwriting purposes;
  • Driver’s license registration;
  • Designating real property as your “homestead”;
  • Where a professional license is issued;
  • Fishing or hunting licenses (paying resident v. non-resident fee);
  • Location of your place of worship;
  • Membership at social, fraternal, athletic club, or country club;
  • Predominant mailing address used; and
  • Location of school(s) attended by the individual’s children including payment of resident v. non-resident tuition.

Clearly, changing your domicile is a decision that requires intentional planning and thorough execution. If you are interested in learning more about changing your domicile, please contact us.