Deciding Domicile for an Estate: Residence versus Domicile

Estate Domicile

Estate Domicile vs. Residence

The estate details of famous actress and comedienne Joan Rivers are largely unknown. The public is aware that she left her $150 million estate to her family, friends, employees, and charities but the provisions are largely unknown because they were placed into a blind trust. However, her will became public when it passed through probate, and it had the unusual provision that stated that Ms. Rivers was a resident of New York but was domiciled in California.

Difference between Residence and Domicile

As a general rule, a person can have multiple residences in many states but can only have one domiciled state. The domicile state is considered the main place of residence and where any state estate or income taxes will be paid. While the estate of a person may have to pay taxes on residences in other states, the domicile state is typically where a person’s estate goes through probate.

A person can be a resident of one state and living in a home and still be considered domiciled in another state. What makes a place a domicile as opposed to a residence is whether the person intends to return. In court, determining domicile is a question of fact that typically turns on the question of whether the person had the intent to remain in, or return to, a particular state and primary place of residence.

However, it should be noted that there is nothing to prevent the possible double taxation of an estate if multiple states claim to have residence. In addition, there is nothing that prevents more than one state from claiming that a person was domiciled there at the date of death and double-taxing the estate. That is why it is so important to make your wishes clear on the terms of domicile and supporting those expressions with actions.

Factors to Determine Domicile

Like Ms. Rivers, there are times when a court must step in to decide where a person was domiciled at the time of death and where they simply resided. When determining where a person was domiciled at the time of death, the courts tend to look at a number of factors. These various factors include:

  • Physical presence and time spent in the state
  • Residence(s) located in the state
  • Where family, spouse and children, reside primarily
  • Employment
  • Bank accounts
  • Voter registration card
  • Driver’s license state
  • Location of real estate and investments
  • Public library card
  • Country clubs, other social clubs, and place of worship membership
  • Services of primary care professionals: doctors, dentist, attorney, banker, accountant
  • Where the estate planning documents are located and filed
    …and other factors that can determine where a person was domiciled at the time of death.

Actions Affecting Domicile

The law is clear that when determining a person’s domicile, actions speak louder than words. Conduct almost always supersedes a person’s expression or desires written in a will. The most important thing to do if you believe that a question of residence and domicile may arise within your estate is to keep accurate and detailed records of your activities. Going through the checklist of factors that the court typically looks at to determine domicile and having everything in your domicile state is a great way to ensure that your wishes regarding domicile and residence are adhered to for your estate.

Contact a New York probate attorney today more specific guidance about how these rules apply in your case.

 

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