Tax Type
Individual Income Tax
Description
Residency
Topic
Taxpayers
Date Issued
05-07-1999
May 7, 1999
Re: § 58.1-1821 Application: Individual Income Tax
Dear****
This will reply to your letter in which you are requesting a redetermination of the department's ruling previously issued to ***** (the "Taxpayer') for the 1990 through 1993 taxable years. A copy of this ruling, Public Document ("P.D.') 96-326, (11/08/96), is attached.
FACTS
The Taxpayer was discharged from active duty in the military in 1989 and began working for an airline in early 1990. The Taxpayer and his spouse owned a home in Virginia where they received the majority of their federal informational returns. In addition, the Taxpayer and his spouse maintained Virginia driver's licenses and were jointly listed in the Northern Virginia telephone directory.
The department considered the Taxpayer and his spouse domiciliary residents of Virginia and issued assessments for the 1990 through 1993 taxable years. While agreeing that the spouse was a Virginia resident, the Taxpayer continues to dispute the department's claim that he is a domiciliary resident. The Taxpayer has provided additional information to support his position that he was a resident of Illinois.
DETERMINATION
Two classes of residents, a domiciliary resident and an actual resident, are set forth in Code of Virginia § 58.1-302, copy enclosed. The domiciliary residence of a person means that 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 another state, that person must intend to abandon his Virginia domicile with no intention of returning to Virginia.
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, therefore, 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 determining domicile, a person's true intention must be determined with reference to all of the facts and circumstances of the particular case. A simple declaration is not sufficient to establish residency.
The department concedes that it is difficult to know whether a taxpayer intends to return to Virginia. The department determines a taxpayer's intent through the information provided. A taxpayer has the burden of proving that he or she has abandoned his or her Virginia domicile. If the information is inadequate to meet his or her burden, the Commissioner must conclude that he or she intended to return to Virginia.
The Taxpayer has now provided Illinois tax returns for 1991 through 1993 to add to the 1990 return provided earlier. All four of these returns indicate a rented mailbox as the address. In each of the four years, the Taxpayer claimed an out of state tax credit on the Illinois return for taxes paid to Virginia. A Virginia non-resident return for the 1990 taxable year was not filed with Virginia until 1995. The Taxpayer sent non-resident returns to the department for all four years in 1997. Interestingly, the nonresident return for 1990 filed in 1997 is not the same as the return filed in 1995.
The Taxpayer has also completed a Virginia domicile questionnaire. The questionnaire indicates that the Taxpayer and his spouse have owned a residence in Virginia since 1985 and a house in Illinois from 1980 to 1996. The Taxpayer has indicated that the Illinois house was used as both a residence and rental property for the years it was held. The evidence does not indicate when the Illinois house was used as a rental property. The Taxpayer has also held a Virginia driver's license since 1984 and has had an automobile registered in Virginia since 1986. The spouse and the children are all residents of Virginia.
Evidence on the questionnaire to support the Taxpayer's Illinois domicile include an Illinois voter registration, employment based in Illinois, and a majority of nights spent in Illinois. While these factors can indicate domicile, the department has determined that the clear weight of the evidence proves domicile in Virginia.
The Taxpayer has not shown that he intended to change his residence to Illinois and concurrently abandon his Virginia residence. The preponderance of documentation suggests that the Taxpayer would return to Virginia as he eventually did to live with his family. The department finds that the new information provided by the Taxpayer is not only inadequate to overturn the original determination, but reinforces its conclusion.
Accordingly, the department's assessments for the 1990 through 1993 taxable years are correct. A schedule showing the current balance of the assessments is attached. Pay the balance in full within 30 days to avoid the accrual of additional interest. Please send your payment to the attention of ***** at the Department of Taxation, Office of Tax Policy, Post Office Box 1880, Richmond, Virginia 23218-1880. If you have any questions, please contact ***** at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/12183G
Rulings of the Tax Commissioner