MIAMI – Jan. 15, 2015 – Atlantic Trust, a private wealth management division of CIBC, advises clients to move to Florida to save on taxes.
"Florida has no individual income tax, so many of our clients who live in states that have a high state income tax consider moving to Florida in order to avoid that level of taxation," says Linda Beerman, chief fiduciary officer for Atlantic Trust. "Florida has long been a popular destination for clients who are retirees because there is no state estate tax as well."
One of the issues individuals can face is continued income tax assessments from their former state even though they've moved away. Therefore, it's important for people who relocated to Florida to establish conclusively that they have changed their domicile.
Proof isn't the same as establishing residency, which simply requires having a presence as an inhabitant of a particular place, Beerman says. Someone establishing a domicile not only lives there, but he or she also demonstrates an intent to make that place a fixed and permanent home.
"Individuals can have several residences – that is, different homes in different states – but you can only have one domicile," Beerman says.
To establish that intent, individuals should spend sufficient time in their new "home" state, register to vote, move some tangible property, become involved in a local church or community activities, and change their address.