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Defining Domicile For Florida Estate Planning Purposes

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The words ‘residence’ and ‘domicile’ are often used interchangeably. However, they have two different meanings, at least in the legal sense. One can have many residences, but only one legal domicile, because where a person has their domicile affects many different legal questions, particularly in the realm of tax law. From an estate planning view, establishing a Florida domicile – not just a residency – may be advantageous to many people, as the state’s low tax burdens can be a boon to those wanting to get their affairs in order.

Residence vs Domicile

A legal domicile is defined under Florida law as a person’s permanent home, as opposed to a mere residence, where your stay can be of short or long duration. It is possible, though time-consuming, to establish a new domicile in Florida – while Florida does not require any long-term residence in the state in order to establish domicile, the state you are leaving may have requirements for when you are permitted to abandon your domicile there.

There are several reasons why individuals may choose to move to Florida, but the main reason for many is the tax burden, or lack thereof. Florida has no state income tax, no estate tax, no state gift tax, and no fiduciary tax. In fact, Florida has a provision in its state constitution expressly stating that any estate or inheritance tax levied that is above the amount levied by the U.S. federal government is unconstitutional, as well as a provision severely limiting any income tax the legislature would choose to create. This obviously creates a beneficial environment for those who are in the process of estate planning.

Establish Your Domicile Affirmatively

While Florida does not have any hard and fast rule about when one’s Florida domicile is officially established, there are several different things that are highly recommended for someone who wants to make their new domicile known. This is more for the purpose of establishing a clear break from your former domicile – if the break is not made clear, your former home state may still be able to collect taxes from you. Examples of recommended steps to take include registering to vote (and voting) in Florida, registering for a Florida driver’s license and obtaining auto insurance, and updating your legal documents like your will to reflect your new domicile.

Perhaps the most important thing to do to cement your intention of making Florida your domicile is to file a Declaration of Domicile in your new home county. This is essentially an affidavit stating your intention to make your new home permanent. While this is not strictly required, it is highly recommended because it is a clear statement of intent that you can provide should there be any doubt later on. Making certain your legal domicile is firmly established can help save you time and trouble in the future.

Contact A Naples Estate Planning Attorney

If you have questions, concerns or just want to set up a complimentary consultation to discuss your personal legal issues in a confidential setting, contact James R. Nici, the Managing Partner of Nici Law Firm, a Naples estate planning attorney with almost 30 years of legal experience.  This may be the first step toward ensuring all is how you want it to be going forward. Contact our offices today via our website, or on the telephone at 239-449-6150, to schedule your complimentary consultation.

Resource:

leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=0200-0299/0222/Sections/0222.17.html

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