With an increasing number of people taking advantage of maintaining dual-residency for income tax purposes (and to escape the cold weather), our clients have been asking how to declare their domicile to be in the State of Ohio for purposes of their estate plan, while also ensuring their estate plan doesn’t jeopardize their residency status in another state.
For example, many Ohio residents flee the state and head to Florida for the winter. Some of our clients have taken the steps to establish themselves as Florida residents, which allows them to take advantage of Florida’s income tax laws. However, they may also maintain a domicile in Ohio and wish for their estate to be administered in Ohio. This poses the question of how to ensure our clients’ estate plan establishes them as domiciled in Ohio for purposes of administering their estate without jeopardizing their residency and income tax status in Florida.
For income tax purposes, residency and domicile are two different things. A decedent can die having multiple residences, but only one domicile, and so the use of these words in a Will should be done intentionally and in line with the client’s wishes. The Will of a person maintaining multiple residences should state that they are a resident of multiple states, for example both Ohio and Florida, and that they declare Ohio to be their domicile for purposes of the administration of their estate upon death. Stating domicile does not impact a person’s state of filing for income tax purposes because this is a factor-based test that a person can meet without establishing full domicile. Further, a person’s Will has no legal effect until their death and the Will is admitted to probate court, so making such a declaration while a person is living has no effect on a person’s residency status for income tax purposes.
Please contact the Attorneys at Thomas Law Group if you maintain multiple residences but wish to declare one your domicile for purposes of estate administration.