Tax Type
Individual Income Tax
Description
Residency
Topic
Taxpayers
Date Issued
06-22-1999
June 22, 1999
Re: Sec. 58.1-1821 Application: Individual Income Tax
Dear***
This will reply to your letter in which you make an application for the correction of individual income taxes assessed to you (the ``Taxpayer') for the 1995 through 1997 taxable years. I apologize for the delay in responding.
FACTS
The Taxpayer is employed as an airline pilot. During the taxable years of 1995, 1996, and a part of 1997, the Taxpayer owned a residence in Virginia and paid property tax on the residence. In 1995, the Taxpayer received informational tax returns at the Virginia residence. The Taxpayer was also listed in the local phone book for his Virginia residence. The Taxpayer did not own any automobiles registered in Virginia or hold any bank accounts in Virginia for the years in question. The Taxpayer also did not spend more than 45 nights in Virginia during any of the years in question.
Since 1988, the Taxpayer has lived at the same residence in another state (``State A') and voted in every general election in State A. During the years in question, the Taxpayer held a State A driver's license, paid the State A intangible personal property tax, and used the address of the State A residence on federal individual income tax returns.
Under audit, the Taxpayer was assessed individual income taxes for the taxable years of 1995, 1996, and partial year 1997. The Taxpayer contends that he was not a domiciliary or actual resident of Virginia for the 1995 through 1997 taxable years.
DETERMINATION
Two classes of residents, a domiciliary resident and an actual resident, are set forth in Code of Virginia Sec. 58.1-302, copy enclosed. Domiciliary residence means the permanent place of residence of a taxpayer and/or the place to which he or she intends to return even though they may actually reside elsewhere. For an individual to change domiciliary residency to another state, that individual must intend to abandon their Virginia domicile with no intention of returning to Virginia.
Concurrently, that individual 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 an individual who, for an aggregate of more than 183 days of the taxable year, maintained a 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, an individual 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 as a resident.
In determining domicile, consideration may be given to an individual's expressed intent, conduct, and all attendant circumstances including, but not limited to, financial independence, profession or employment, income sources, residence of spouse, marital status, sites of real and tangible property, motor vehicle registration and licensing, and such other factors as may be reasonably deemed necessary to determine an individual's domicile. An individual'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 an individual intends to return to Virginia. The individual has the burden of proving abandonment of his or her Virginia domicile. If the information is inadequate to meet this burden, the department will conclude that he or she intended to return to Virginia.
Based on the information provided, the Taxpayer was not a domiciliary resident of Virginia. The main connection between the Taxpayer and Virginia is the residence owned by the Taxpayer. The Taxpayer stated that this residence was only used during layovers and was not a primary residence.
This is evidenced by the fact that the Taxpayer spent no more than 45 days in Virginia in any of the years at issue. Aside from the informational tax returns sent to the Virginia residence in 1995, all other important documents, licenses, and information have indicated the Taxpayer's address in State A.
The evidence also shows that the Taxpayer was not present in Virginia enough days in any one year to qualify as an actual resident. In addition, the Taxpayer incurred a loss when the Virginia residence was sold for a loss in 1997 and would not make the Taxpayer subject to Virginia income tax as a nonresident.
Accordingly, the assessments for the taxable years of 1995 through 1997 have been abated. If you have any questions, you may contact ***** in the Office of Tax Policy at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/20621G
Re: Sec. 58.1-1821 Application: Individual Income Tax
Dear***
This will reply to your letter in which you make an application for the correction of individual income taxes assessed to you (the ``Taxpayer') for the 1995 through 1997 taxable years. I apologize for the delay in responding.
FACTS
The Taxpayer is employed as an airline pilot. During the taxable years of 1995, 1996, and a part of 1997, the Taxpayer owned a residence in Virginia and paid property tax on the residence. In 1995, the Taxpayer received informational tax returns at the Virginia residence. The Taxpayer was also listed in the local phone book for his Virginia residence. The Taxpayer did not own any automobiles registered in Virginia or hold any bank accounts in Virginia for the years in question. The Taxpayer also did not spend more than 45 nights in Virginia during any of the years in question.
Since 1988, the Taxpayer has lived at the same residence in another state (``State A') and voted in every general election in State A. During the years in question, the Taxpayer held a State A driver's license, paid the State A intangible personal property tax, and used the address of the State A residence on federal individual income tax returns.
Under audit, the Taxpayer was assessed individual income taxes for the taxable years of 1995, 1996, and partial year 1997. The Taxpayer contends that he was not a domiciliary or actual resident of Virginia for the 1995 through 1997 taxable years.
DETERMINATION
Two classes of residents, a domiciliary resident and an actual resident, are set forth in Code of Virginia Sec. 58.1-302, copy enclosed. Domiciliary residence means the permanent place of residence of a taxpayer and/or the place to which he or she intends to return even though they may actually reside elsewhere. For an individual to change domiciliary residency to another state, that individual must intend to abandon their Virginia domicile with no intention of returning to Virginia.
Concurrently, that individual 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 an individual who, for an aggregate of more than 183 days of the taxable year, maintained a 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, an individual 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 as a resident.
In determining domicile, consideration may be given to an individual's expressed intent, conduct, and all attendant circumstances including, but not limited to, financial independence, profession or employment, income sources, residence of spouse, marital status, sites of real and tangible property, motor vehicle registration and licensing, and such other factors as may be reasonably deemed necessary to determine an individual's domicile. An individual'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 an individual intends to return to Virginia. The individual has the burden of proving abandonment of his or her Virginia domicile. If the information is inadequate to meet this burden, the department will conclude that he or she intended to return to Virginia.
Based on the information provided, the Taxpayer was not a domiciliary resident of Virginia. The main connection between the Taxpayer and Virginia is the residence owned by the Taxpayer. The Taxpayer stated that this residence was only used during layovers and was not a primary residence.
This is evidenced by the fact that the Taxpayer spent no more than 45 days in Virginia in any of the years at issue. Aside from the informational tax returns sent to the Virginia residence in 1995, all other important documents, licenses, and information have indicated the Taxpayer's address in State A.
The evidence also shows that the Taxpayer was not present in Virginia enough days in any one year to qualify as an actual resident. In addition, the Taxpayer incurred a loss when the Virginia residence was sold for a loss in 1997 and would not make the Taxpayer subject to Virginia income tax as a nonresident.
Accordingly, the assessments for the taxable years of 1995 through 1997 have been abated. If you have any questions, you may contact ***** in the Office of Tax Policy at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/20621G
Rulings of the Tax Commissioner