Many fulltimers establish residency in Texas and South Dakota, along with a few other non-income taxed states. Has anyone had any experience with having trouble with your former State of Residence trying to hang onto you? This is our first year, so we are looking for things to be aware of and keep in proper order. We have our present residency and mailing address in South Dakota, with our trailer and truck liscensed and registered there. We will be taking deliverey of a new rig this month and a 3% tax will be paid in S.D. and it will be registered there. We voted by absentee ballot in last falls election in South Dakota. We have not drawn up any new legal documents such as wills etc in South Dakota and are also wondering where this fits in the residency question. Can anyone address the true legality of this and is there any test of true residency status, as I have heard different opinions similar to the LLC issue? We are on the road full-time, but still own a condo in our original State of Wisconsin, which we rent out and pay property tax on. We return to WI and live in our rig at a campground about two months each year. We spend another three months near a daughter and family in NW Arkansas and three months near another daughter and family in Minnesota. The rest of the time we are somewhere in the South. We see our family Dr. in WI twice each year and have found a new Dentist in Mexico. We visit Chiropractors throughout the U.S. and have monthly blood draws that are sent to our Dr. in WI from whereever we are. Our retirement benefits are from the State of WI and we have banking in our former bank in WI of 35 years, Emigrant Direct in New York and Citibank. I may drop the new Citibank account, as our Credit Union in WI is easier to work with electronically and use Emigrant Direct for their Money Market. Any experience examples appreciated or residency definition tests.
Thanks you
Howard said
07:13 PM Feb 11, 2007
Well I can't answer any questions about maintenance or electrical stuff or mechanical stuff, but this is an issue I know a little something about.
Relatively few people have actually been in a battle between states over residency. So you probably won't find someone on the Forum that has gone through it. With that said, it is such a nightmare for the folks out there that have been through the ordeal, we all should try to avoid it if we can.
The legal test for residency is "significant contacts". You will be considered a resident of the state with which you have the most "significant contacts". Significant contacts are many of the things you have mentioned: mailing address, voter registration, vehicle registration, real estate ownership, RV registration, driver licenses, place of employment, banking, and the grandaddy of them all, actually living in the state. "Intent" of where you want your residence to be is an important factor as well, but it is not controlling if the actual "contacts" do not support the intent.
The problem is that all the states have widely varying definitions of "significant contacts". You just never know what they will do. Some are very aggressive and it doesn't take much in their eyes to have enough contact with them to make you resident. You really have to be careful about working or living in certain states for more than six months.
To avoid any problems, we recommend that you have ALL contacts with one state or the scale is heavily weighted toward one state. We don't want to give any other state an argument.
In your situation, you have really good contacts with South Dakota and your intent seems to be South Dakota. Your "contacts" with Arkansas and Minnesota are no big deal at all.
Your Wisconsin "contacts" are probably enough to give Wisconsin an argument which would make me just a tad nervous. None of the Wisconsin "contacts" by themselves are particularly worrisome. Even the property ownership, which is a biggie in the "significant contacts" test, is not a problem by itself. But add that together with the banking, and the retirement benefits, and the doctor, and the two months a year in the state, and the scale is not balanced toward South Dakota as much as I would like to see.
You are probably still okay, but if it were me, I would consider transferring title to the condo into a corporation or LLC, and I would probably change the banking to South Dakota or to a national account in a state besides Wisconsin. Those two changes would make me a lot more comfortable. You can't do anything about the retirement benefits, the two months a year is really minor, and I would never change from a really good doctor.
Again, these are just the things I would do to throw that scale more toward South Dakota. You have to decide for yourself if the risk is worth making the changes.
My main job is just to provide the legal framework for how residency is clearly established. I hope this has helped.
nicknpick said
12:58 PM Feb 16, 2007
My husband and I have just started researching full timing. How do most people receive mail? We would like to sell our home, and only have the RV. Is it possible to have an address with out a "home"?
Darrell and Judy said
05:56 PM Feb 16, 2007
Nicole,
Yes, you can have a permanent address without owning a home. That is what the Escapees Club provides us with. We also use their mail forwarding service - they forward our mail to "General Delivery" at a post office that we request. Escapees is an excellent support system for fulltime RVer's and provides many benefits. You can go online at Escapees.com.
Darrell
RVDude said
07:25 PM Feb 16, 2007
You can also get your mail received/forwarded using a "The UPS Store" or other similar mail center. As these are in every state you have more "residency" flexibility than the TX and SD options. Remember, a big flag for residency is where you get your mail and hence, the associated IRS mailing address. If you don’t chose to “move” to TX (the SKPs) or SD (several others firms) you might need to use one of these mailing stores to “create” an address in your “residency“ state.
Judy said
09:48 PM Feb 16, 2007
We use this as ours (UPS Store) have had no problems with it and call and see whats there once a wk and they ship it right out to us. It is a legal address. southwestjudy & Bob & 2blackdogs
ahoweth said
07:51 AM Feb 17, 2007
Howard is dead on with respect to the residency issue. The real biggies are where you are registered to vote, the state which issued your drivers license and where your vehicles are registered. Another biggy is where you do most of your financial dealings. A another is where your get your mail. All of this is establishing intent as to where your "Reside".
You can have a mail service as your permanent address. However, there are issues with that as to exactly how a mail box is addressed. The Escapees are good. They have been in the business of mail forwarding for a long while and have addressed these issues for the state of Texas. They have more than 30,000 folks who use their mail forwarding service. They are big enough that they have their own zip code. Of course how other states define residency may vary and Howard is right that an investigation of the state where you own property and do most of your financial dealings, as to how they define "residency" would be a good thing to do to protect yourself. A nasty court battle, should the state decide it is in their best interest to pursue you, is the last thing you want. Some states, California comes to mind, may be agressive enough to pursue it, especially if you have a retirement annuity or pension from that state.
Judy said
10:13 AM Feb 17, 2007
New Mexico is our "land of enchantment" and we shall always use it as our residency as we vote by mail ballot, pay taxes there, our banking is done there, vehicles are registered there even though do not own property there and are full timing... southwestjudy & Bob &2blackdogs
nicknpick said
02:43 PM Feb 19, 2007
Thank you all for your help! We will check out Escapees and see what they have to offer!
Travelin Duo said
01:39 PM Jun 14, 2007
Has anyone used The Good Sam Club for mail forwarding and also for their address etc in Florida? I understand they do the same as Escapees for you? I believe it is SD...FL....and Texas most used for full timing. If you sell your home and just live in your RV full time...are these the better states to use as a "home" address? All the information on this forum has helped so very much, but it is still a bit confusing for us beginners. We will be doing this next spring, and appreciate the help. Thanks
Judy said
02:12 PM Jun 14, 2007
What you need to do is ck states that have low or no state income tax and a small vehicle registration fee.....California for example will cost lots for these two. Other states such as Texas have a vehicle inspection of which you have to be there in person to have it done....others do not... southwestjudy & Bob & 2blackdogs
Howard said
10:18 AM Jun 15, 2007
Travelin Duo,
Most full-timers do use Texas, Florida, & South Dakota because they are "no income tax" states AND there are proven, reliable mail forwarding services.
But there are several other factors to consider and these may not be the best states depending on your situation. Check out our Choosing A Home Base page just to be sure you are considering some of those other factors.
Travelin Duo said
09:04 PM Jun 26, 2007
Howard, Thanks for the info, and we have read your page and it is so informative. Appreciate the help. Seems South Dakota does not require you to go there to have an inspection on your coach as does Texas. Someone else said that Florida now has very high insurance rates after the hurricanes. So many choices...so little time.... Now that we finally have decided on a coach and model etc.....we have to decide on Texas or South Dakota ! More reading. Although this year it will be our home state because Larry does not retire until May 2008. Also we still own our home here. So everything will get done here when we buy our coach soon. So we have a while to look into it before we hit the road for good. Thank you again. Arlene
Travelin Duo said
09:09 PM Jun 26, 2007
Judy, Thank you, and we will be looking into that. Howards page on the subject really cleared up a lot of questions for us. Appreciate your help. Arlene
Sunseeker said
12:14 AM Jun 27, 2007
Be careful. There are differences under various state's laws as to the abandoment of "residency" vise "domcile". As an attorney, I have represented a client attempting to abandon Maryland domicle (for income tax purposes). Maryland law provides that unless the taxpayer can prove both residency and domicle in a new state, Maryland remains the state of domicle. Residence is generally where the taxpayer lives -- but a taxpayer may have more than one residence, resulting in the taxpayer not having ANY principal residence (tax court decision resulting in the taxpayer who lived "x" months in one state and "y" months in another state not being able to exclude gain on sale of residence in either state as neither was their "principal" residence). Domicle generally requires both physical presence in the new state and the subjective intent to remain (as dominstrated by the indicia previously mentioned (i.e. primary contacts, banking, clubs, church membership, etc.) It's not all about where the mail is delivered! (and in a court challenge, the old state would certainly query as to whether the taxpayer actually received the mail in the new state or whether it was merely forwarded elsewhere.)
--I'm not saying that the taxpayer could not or would not prevail -- just don't be so sure.
Oh, and while in the four states in which I am licensed to practice law, I would generally recommend that a client transfer a rental condo into a LLC, be careful. In many other states such a transfer would not qualify for an exemption from transfer taxes (and the ownership would no longer be protected by the original title insurance policy). -- Just a hint to check the details.
-- Edited by Sunseeker at 01:22, 2007-06-27
-- Edited by Sunseeker at 13:21, 2007-06-27
Jim01 said
06:51 AM Jun 27, 2007
Think about it. If you were moving into a new house in a different state, what would you do? You would move all of your belongings to the new state, get a new drivers licence, register to vote, open a new bank account, find a new insurance agent, get a new lawyer, and in general, start a new life in that state.
When you go Full-timing, you are starting a new life. Everything will be different, so why not make the move completely and avoid a lot of possible problems down the road.
The RVers I have met who try to get around taxes by picking and choosing different states for different things, usually have problems at some time or another.
I understand that if you are keeping a house or property in your old state, you will have to deal with the legalities of that, but why not make everything else as simple and trouble free as possible?
When we went Full-timing, it was to get away from the rat race and make life as easy as possible. We didn't want hassles down the road, and I don't think most people do. We moved everything, and I mean everything, to our new residence. To us. it didn't make sense to try to save a few dollars and then have worry about what problems we might have in the future.
Full-timing is a great way of life. Make it as easy on yourself as you can.
SKOOBDO said
09:06 PM Jul 1, 2007
LIKENIT wrote:
Many fulltimers establish residency in Texas and South Dakota, along with a few other non-income taxed states. Has anyone had any experience with having trouble with your former State of Residence trying to hang onto you? This is our first year, so we are looking for things to be aware of and keep in proper order. We have our present residency and mailing address in South Dakota, with our trailer and truck liscensed and registered there. We will be taking deliverey of a new rig this month and a 3% tax will be paid in S.D. and it will be registered there. We voted by absentee ballot in last falls election in South Dakota. We have not drawn up any new legal documents such as wills etc in South Dakota and are also wondering where this fits in the residency question. Can anyone address the true legality of this and is there any test of true residency status, as I have heard different opinions similar to the LLC issue? We are on the road full-time, but still own a condo in our original State of Wisconsin, which we rent out and pay property tax on. We return to WI and live in our rig at a campground about two months each year. We spend another three months near a daughter and family in NW Arkansas and three months near another daughter and family in Minnesota. The rest of the time we are somewhere in the South. We see our family Dr. in WI twice each year and have found a new Dentist in Mexico. We visit Chiropractors throughout the U.S. and have monthly blood draws that are sent to our Dr. in WI from whereever we are. Our retirement benefits are from the State of WI and we have banking in our former bank in WI of 35 years, Emigrant Direct in New York and Citibank. I may drop the new Citibank account, as our Credit Union in WI is easier to work with electronically and use Emigrant Direct for their Money Market. Any experience examples appreciated or residency definition tests.
Thanks you
Likenit, I just ran across this thread tonight. I attended a rally/conference in south dakota where an attorney was there and other folks like insurance companies, banks and mail forwarding company. If you chose a bank SD, Wells Fargo will be a good starting point as they have banks nationwide. The Attorney indicated that Minnesota, New York and California are states that have strict laws on Estates and Tax Issues when moving out of state, where individuals did not make a clean transfer to South Dakota. He did say a new Last Will and Testament with your new legal address would really help elliviate any issues, if there is ever a question of your domicile especially in the states indicated above. By the way, all you need is a driver's license or state Id card, and registrations to be a legal resident. In order to register to vote in SD, you need a "real" street address (not mail forwarding street address). So many folks use a motel or campground address. It never hurts to notify the IRS and your old State Tax Dept of your new address. It shows intent of notifying them on your relocation and new address. Save all e-mails and copies of letters. Wish you the best!
D and J said
04:34 PM Aug 17, 2007
I wonder if anyone else has had the same residency issues that I ran into today. We have choosen SD as our new residence, but, according to my finacial advisor at Morgan Stanley, Alternative Resources in Sioux Falls is not a "real" address. We still have a NJ address until 9/20, so I need to resolve this issue soon. Schwab has no problem (yet) with my new address, but I don't have too much money tied up with Schwab.
I like my relationship with MS, they don't charge me for stock, bond, or mutual fund trades, but I am very close to ripping (what's left of) my hair out about this!
I wonder if I am about to experince the same problems with my banks and credit cards??
I thought fulltiming was going to give me new freedoms. . . .why am I being treated like a terrorist???
SKOOBDO said
05:16 PM Aug 17, 2007
D & J, I'm sure someone else will be by soon to help you out, but I haven't experienced any issues using my mail forwarding address for anything. I don't think anyone has ever stated that any mail forwarding address is a REAL address, however, it is accepted for vehicle registrations, drivers license, banking etc. It is a "real" address you can use for these purposes, but not for registering to vote. I have several financial accounts opened using this my mail forwarding address. Not sure what is up with your financial companies. Did they do an inquiry into the address and told you that, or did you tell them it was a mail forwarding company and you live in new jersey, or what? Something doesn't sound right, and I'm not blaming you, but I would think if this problem was wide spread, there would be many reported problems posted on this forum and others. I have a feeling this is isolated, and for you it's not helping the situation. I wish you the best in resolving this issue.
Jim01 said
08:20 PM Aug 17, 2007
Edward Jones does not have a problem with my mail forwarding address in SD. In fact, I have not had any problems at all.
I would strongly recommend that you do not try to keep bank accounts etc. in more than one state. More than likely, you will have problems. If you want to stay with MS I would suggest finding an agent in SD and talking to them.
You may want to check out Howard's and My posts earlier in this thread. Also Howard addresses this issue in topics that you can access from the Home Page on this Web site.
Good luck
D and J said
10:14 AM Aug 18, 2007
Thanks all, My account has always been in Seattle, and I have always been living in NJ. For some reason MS's fraud and security department knows A.R. is a mail forwarding service and they are not accepting it as my physical address.
I have an appointment to talk to the local MS folk in the Sioux Falls office on Monday. Hopefully this will all work out, cause my MS account does not charge me commision for trades, and I don't need to add "looking for a new broker" to my list of things I need to do before our house closing!!
I'll let you know what happens, Doug
bjoyce said
11:35 AM Aug 18, 2007
To divert the current discussion but staying within the original title I recently learned of a potential problem for a few making the residency change. Some states allow insurance companies to disallow covering preexisting conditions on transfer in some instances and some people with heart problems, sleep apnea, diabetes, etc., find that they have to pay their health expenses out of pocket for at least a year while paying their premiums. If you depend on your health insurance to cover your preexisting conditions then make sure you will be covered on the move. It does not sound very common, but check anyway since you don't want to be one of the ones in trouble.
I think this is all related to the point that only you can determine what is right for you in which state (or Canadian province) to domicile in. Everyone's case is different. We are Washington State residents for health insurance reasons and our mail goes to a relative's house. We would love to have reduced the sales tax when we bought our motorhome, but it was not to be.
I do know that Escapees vigorously defends using their mail forwarding address as a "real" address, including voting. They will send the appropriate paperwork to a bank, brokerage, insurance company, or any other business to confirm it.
Can anyone address the true legality of this and is there any test of true residency status, as I have heard different opinions similar to the LLC issue?
We are on the road full-time, but still own a condo in our original State of Wisconsin, which we rent out and pay property tax on. We return to WI and live in our rig at a campground about two months each year. We spend another three months near a daughter and family in NW Arkansas and three months near another daughter and family in Minnesota. The rest of the time we are somewhere in the South.
We see our family Dr. in WI twice each year and have found a new Dentist in Mexico. We visit Chiropractors throughout the U.S. and have monthly blood draws that are sent to our Dr. in WI from whereever we are. Our retirement benefits are from the State of WI and we have banking in our former bank in WI of 35 years, Emigrant Direct in New York and Citibank. I may drop the new Citibank account, as our Credit Union in WI is easier to work with electronically and use Emigrant Direct for their Money Market.
Any experience examples appreciated or residency definition tests.
Thanks you
Relatively few people have actually been in a battle between states over residency. So you probably won't find someone on the Forum that has gone through it. With that said, it is such a nightmare for the folks out there that have been through the ordeal, we all should try to avoid it if we can.
The legal test for residency is "significant contacts". You will be considered a resident of the state with which you have the most "significant contacts". Significant contacts are many of the things you have mentioned: mailing address, voter registration, vehicle registration, real estate ownership, RV registration, driver licenses, place of employment, banking, and the grandaddy of them all, actually living in the state. "Intent" of where you want your residence to be is an important factor as well, but it is not controlling if the actual "contacts" do not support the intent.
The problem is that all the states have widely varying definitions of "significant contacts". You just never know what they will do. Some are very aggressive and it doesn't take much in their eyes to have enough contact with them to make you resident. You really have to be careful about working or living in certain states for more than six months.
To avoid any problems, we recommend that you have ALL contacts with one state or the scale is heavily weighted toward one state. We don't want to give any other state an argument.
In your situation, you have really good contacts with South Dakota and your intent seems to be South Dakota. Your "contacts" with Arkansas and Minnesota are no big deal at all.
Your Wisconsin "contacts" are probably enough to give Wisconsin an argument which would make me just a tad nervous. None of the Wisconsin "contacts" by themselves are particularly worrisome. Even the property ownership, which is a biggie in the "significant contacts" test, is not a problem by itself. But add that together with the banking, and the retirement benefits, and the doctor, and the two months a year in the state, and the scale is not balanced toward South Dakota as much as I would like to see.
You are probably still okay, but if it were me, I would consider transferring title to the condo into a corporation or LLC, and I would probably change the banking to South Dakota or to a national account in a state besides Wisconsin. Those two changes would make me a lot more comfortable. You can't do anything about the retirement benefits, the two months a year is really minor, and I would never change from a really good doctor.
Again, these are just the things I would do to throw that scale more toward South Dakota. You have to decide for yourself if the risk is worth making the changes.
My main job is just to provide the legal framework for how residency is clearly established. I hope this has helped.
Yes, you can have a permanent address without owning a home. That is what the Escapees Club provides us with. We also use their mail forwarding service - they forward our mail to "General Delivery" at a post office that we request. Escapees is an excellent support system for fulltime RVer's and provides many benefits. You can go online at Escapees.com.
Darrell
southwestjudy & Bob & 2blackdogs
You can have a mail service as your permanent address. However, there are issues with that as to exactly how a mail box is addressed. The Escapees are good. They have been in the business of mail forwarding for a long while and have addressed these issues for the state of Texas. They have more than 30,000 folks who use their mail forwarding service. They are big enough that they have their own zip code. Of course how other states define residency may vary and Howard is right that an investigation of the state where you own property and do most of your financial dealings, as to how they define "residency" would be a good thing to do to protect yourself. A nasty court battle, should the state decide it is in their best interest to pursue you, is the last thing you want. Some states, California comes to mind, may be agressive enough to pursue it, especially if you have a retirement annuity or pension from that state.
southwestjudy & Bob &2blackdogs
Has anyone used The Good Sam Club for mail forwarding and also for their address etc in Florida?
I understand they do the same as Escapees for you?
I believe it is SD...FL....and Texas most used for full timing.
If you sell your home and just live in your RV full time...are these the better states to use as a "home" address?
All the information on this forum has helped so very much, but it is still a bit confusing for us beginners.
We will be doing this next spring, and appreciate the help.
Thanks
southwestjudy & Bob & 2blackdogs
Most full-timers do use Texas, Florida, & South Dakota because they are "no income tax" states AND there are proven, reliable mail forwarding services.
But there are several other factors to consider and these may not be the best states depending on your situation. Check out our Choosing A Home Base page just to be sure you are considering some of those other factors.
Thanks for the info, and we have read your page and it is so informative.
Appreciate the help.
Seems South Dakota does not require you to go there to have an inspection on your coach as does Texas.
Someone else said that Florida now has very high insurance rates after the hurricanes.
So many choices...so little time....
Now that we finally have decided on a coach and model etc.....we have to decide on Texas or South Dakota !
More reading.
Although this year it will be our home state because Larry does not retire until May 2008.
Also we still own our home here.
So everything will get done here when we buy our coach soon.
So we have a while to look into it before we hit the road for good.
Thank you again.
Arlene
Thank you, and we will be looking into that.
Howards page on the subject really cleared up a lot of questions for us.
Appreciate your help.
Arlene
--I'm not saying that the taxpayer could not or would not prevail -- just don't be so sure.
Oh, and while in the four states in which I am licensed to practice law, I would generally recommend that a client transfer a rental condo into a LLC, be careful. In many other states such a transfer would not qualify for an exemption from transfer taxes (and the ownership would no longer be protected by the original title insurance policy). -- Just a hint to check the details.
-- Edited by Sunseeker at 01:22, 2007-06-27
-- Edited by Sunseeker at 13:21, 2007-06-27
Think about it. If you were moving into a new house in a different state, what would you do? You would move all of your belongings to the new state, get a new drivers licence, register to vote, open a new bank account, find a new insurance agent, get a new lawyer, and in general, start a new life in that state.
When you go Full-timing, you are starting a new life. Everything will be different, so why not make the move completely and avoid a lot of possible problems down the road.
The RVers I have met who try to get around taxes by picking and choosing different states for different things, usually have problems at some time or another.
I understand that if you are keeping a house or property in your old state, you will have to deal with the legalities of that, but why not make everything else as simple and trouble free as possible?
When we went Full-timing, it was to get away from the rat race and make life as easy as possible. We didn't want hassles down the road, and I don't think most people do. We moved everything, and I mean everything, to our new residence. To us. it didn't make sense to try to save a few dollars and then have worry about what problems we might have in the future.
Full-timing is a great way of life. Make it as easy on yourself as you can.
I like my relationship with MS, they don't charge me for stock, bond, or mutual fund trades, but I am very close to ripping (what's left of) my hair out about this!
I wonder if I am about to experince the same problems with my banks and credit cards??
I thought fulltiming was going to give me new freedoms. . . .why am I being treated like a terrorist???
D & J, I'm sure someone else will be by soon to help you out, but I haven't experienced any issues using my mail forwarding address for anything. I don't think anyone has ever stated that any mail forwarding address is a REAL address, however, it is accepted for vehicle registrations, drivers license, banking etc. It is a "real" address you can use for these purposes, but not for registering to vote. I have several financial accounts opened using this my mail forwarding address. Not sure what is up with your financial companies. Did they do an inquiry into the address and told you that, or did you tell them it was a mail forwarding company and you live in new jersey, or what? Something doesn't sound right, and I'm not blaming you, but I would think if this problem was wide spread, there would be many reported problems posted on this forum and others. I have a feeling this is isolated, and for you it's not helping the situation. I wish you the best in resolving this issue.
I would strongly recommend that you do not try to keep bank accounts etc. in more than one state. More than likely, you will have problems. If you want to stay with MS I would suggest finding an agent in SD and talking to them.
You may want to check out Howard's and My posts earlier in this thread. Also Howard addresses this issue in topics that you can access from the Home Page on this Web site.
Good luck
I have an appointment to talk to the local MS folk in the Sioux Falls office on Monday. Hopefully this will all work out, cause my MS account does not charge me commision for trades, and I don't need to add "looking for a new broker" to my list of things I need to do before our house closing!!
I'll let you know what happens, Doug
I think this is all related to the point that only you can determine what is right for you in which state (or Canadian province) to domicile in. Everyone's case is different. We are Washington State residents for health insurance reasons and our mail goes to a relative's house. We would love to have reduced the sales tax when we bought our motorhome, but it was not to be.
I do know that Escapees vigorously defends using their mail forwarding address as a "real" address, including voting. They will send the appropriate paperwork to a bank, brokerage, insurance company, or any other business to confirm it.