Tax Type
Individual Income Tax
Description
Residency Ruling Request
Topic
Residency
Date Issued
10-23-2001
October 23, 2001
Re: Request for Ruling: Individual Income Tax
Dear *****
This will reply to your letter in which you request a ruling as to whether ***** (the "Taxpayers") are liable for Virginia individual income tax for the 1987 though 2000 taxable years.
FACTS
The Taxpayers moved to Virginia from another state ("State A") in the early 1980's to pursue a job opportunity. While in Virginia, the Taxpayers acquired Virginia driver's licenses, registered a car, and registered to vote in Virginia. In January of 1987, they were transferred out of the country and claimed State A as their domicile. After moving out of the country, they filed State A income tax returns, registered to vote in State A, and maintained State A driver's licenses. The Taxpayers are contemplating moving back to Virginia and have requested a ruling as to whether they are liable for any Virginia income tax as a domiciliary resident for the years spent out of the country.
DETERMINATION
Two classes of residents, a domiciliary resident and an actual resident, are set forth in Code of Virginia § 58.1-302. The domiciliary residence of a person means the permanent place of residence of a taxpayer and the place to which he intends to return even though he may actually reside elsewhere. For a person to change domiciliary residency to Virginia, that person must intend to abandon his old domicile with no intention of returning to that same domicile. Concurrently, that person must acquire a new domicile where that person is physically present with the intention to remain there permanently or indefinitely. An actual resident of Virginia means a person who, for an aggregate of more than 183 days of the taxable year, maintained his place of abode within Virginia. A Virginia domiciliary resident working in other parts of the country who has not abandoned his Virginia residency continues to be subject to Virginia taxation. Additionally, a person who is not a domiciliary resident of Virginia, but who stays in Virginia for an aggregate of more than 183 days is also subject to Virginia taxation.
In order to change from one legal domicile to another legal domicile, there must be (1) actual abandonment of the old domicile, coupled with an intent not to return to it, and (2) an acquisition of a new domicile at another place, which must be formed by personal presence and an intent to remain there permanently or indefinitely. In determining domicile, consideration must be given to a person's expressed intent, conduct, and all attending circumstances. An old domicile remains until a new domicile is established. The burden of proving that the domicile has been changed lies with the person alleging the change.
Even though the Taxpayers accepted temporary employment in foreign countries, there is strong evidence that they conducted activities consistent with establishing domicile in State A and abandoning their Virginia domicile over a period of time beginning in 1987. These activities include filing State A income tax returns, acquiring State A driver's licenses and registering to vote in State A. The Taxpayers did not maintain a residence or any other property in Virginia after 1986.
Based on the facts as presented in your letter, it does not appear that the Taxpayers were domiciliary residents of Virginia for the 1987 through 2000 taxable years. Therefore, they are not liable for Virginia individual income tax for the 1987 through 2000 taxable years. As with any ruling provided by the department, this analysis is limited to the years and the facts and circumstances presented. Any material changes in the facts could alter the results.
If you have any questions regarding this matter, you may contact ***** in the department's Office of Policy and Administration, Appeals and Rulings, at ******.
Sincerely,
Danny M. Payne
Tax Commissioner
ARO/35352B
Rulings of the Tax Commissioner