Document Number
85-15
Tax Type
Individual Income Tax
Description
Status of taxpayer transferred to West Germany
Topic
Residency
Taxpayers
Date Issued
02-14-1985

  • February 14, 1985


    Re: §58-1118 Application: Individual Income Tax


    Dear ****

    This refers to your letter dated October 5, 1984, on behalf of ***** for correction of individual income tax assessed in their 1980 and 1981 Virginia individual income tax returns.

    FACTS

    Taxpayers' 1980 and 1981 Virginia individual income tax returns were adjusted in 1984 to reflect income taxpayer earned while residing in West Germany on business. During this period, taxpayer was transferred to West Germany on an "indefinite basis." Taxpayer states that efforts to sell his house in Virginia during this period failed due to the depressed housing market. Furthermore, taxpayer states that he rented an apartment, owned tangible personal property, including an automobile, paid German income tax and was a legally registered resident of West Germany. Lastly, taxpayer argues he was entitled under Section 911 of the Internal Revenue Code to exclude his foreign income for federal income tax purposes, but elected to use the foreign tax credit provisions instead.

    It is our understanding, based on taxpayer's Domicile Questionnaire, that taxpayer has been domiciled in and an actual resident of Virginia from August 1976 through June 1978, and since his return from West Germany in February 1981 through the present time. It is our further understanding that taxpayer maintained a residence in Virginia, and that taxpayer's children attended public schools in Virginia for some part of the period in question. Furthermore, we understand that taxpayer paid local property taxes in Virginia, maintained a Virginia motor vehicle operators license, and was a Virginia registered voter for all or part of the period in question. Taxpayer admits to having voted in the 1980 general election in Virginia. Taxpayer has also maintained accounts within Virginia for all or part of the period in question. Taxpayer's automobile bore Virginia license plates throughout the period 1975-1983.


    DETERMINATION

    Section58.1-302 defines domicile as "the permanent place of residence of a taxpayer and the place to which he intends to return even though he may actually reside elsewhere."

    Section 630-2-302(3) of the Virginia Individual Income Tax Regulations, state that, "Any person who has not moved from the state, with the intention of permanently residing outside of Virginia is still a domiciliary resident even though he may be actually living some place else." The regulations state further that "domicile, once established continues until the individual moves to a new location with the bona fide intention of making his fixed and permanent home there." The determination of bona fide intention to change one's domicile is a factual matter which must be resolved on a case by case basis. "No single factor is dispositive in determining domicile; rather the factors are examined collectively to determine if the intent to acquire or abandon Virginia domicile exists. A simple declaration of intent to abandon domicile, or physical presence elsewhere is insufficient to abrogate Virginia domicile." And, the burden of proving that "an individual has abandoned or failed to establish domicile in Virginia rests with the individual."

    Although taxpayer has presented some facts which standing alone might show an intent to abandon Virginia domicile, when these facts are examined collectively with all the other facts presented, intent to abandon Virginia domicile has not been established. For example, taxpayer has been a registered voter in Virginia since 1980, and voted in the 1980 general election; taxpayer paid local property tax on real property located in Virginia from 1978-1983, and owned a home in Virginia throughout the tax period in question. Furthermore, taxpayer has held a Virginia motor vehicle operator's license since 1977, has owned an automobile which has borne Virginia license plates since 1975, and has maintained bank accounts within Virginia for all or part of the tax period in question.

    Therefore, we find no basis for the relief from individual income tax requested by the taxpayer.

    Sincerely,

    W. H. Forst
    Tax Commissioner

Rulings of the Tax Commissioner

Last Updated 08/25/2014 16:46