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Popular Domicile States for RVers- Texas, Florida, South Dakota

Let me introduce myself. I am a law partner in the firm of Loring & Associates. My law partner, Shawn Loring, is also CEO of Escapees. Our firm concentrates on matters important to the fulltime RVers. One of the most important areas of concern is “Domicile”. When you live in an RV fulltime, what is your domicile and who cares? How does one decide which is best?

Are my only options South Dakota, Texas, or Florida?

The answer is “NO!” Though many RVers choose one of these three states for their domicile, these are not the only states available to you. Do not think that your choices for domicile are limited to Texas, South Dakota and Florida. First, you must be very clear about the places you see yourself returning to on a regular basis.

What exactly does “domicile” mean?

Domicile has been defined as the place you “intend to call home.” Since you are living in an RV and roaming freely, you may think you don’t want to call any place “home.” That’s fine, as long as:

  1. You don’t need a driver license;
  2. you don’t want to vote;
  3. you don’t need any health insurance;
  4. you don’t need vehicle insurance;
  5. you don’t need a bank account; and
  6. you aren’t planning on filing any income tax returns…

to name just a few reasons why you must have a domicile, some place you “intend to call home.”

So how do I choose the best state?

Start with where you are. This week I got one of the best calls I could have received. A couple called to say they were RVers fulltime. They had been told by eager fulltime RVers that they needed to decide which state they wanted to call home: Texas, South Dakota or Florida. 

But then they watched the Facebook Live presentation that my law partner, Shawn Loring, and I made about a month ago. In that presentation, they learned that first you need to look at where you were spending your time. They realized that at least six months of the year they will be in Arizona. They have an address to use in Arizona. Arizona is where they intend to call home. I was thrilled! That’s exactly what you should first ask, “where do we see as the anchor, the place we go back to on a regular basis? Maybe it’s where your kids live. Maybe it’s where you have friends, or doctors, or parents or real estate.

Download these free Domicile Guides and Checklists to help you decide where to Domicile!

What if you don’t have an address anywhere that you can use?

Then you may want to choose one of the easier states to establish domicile—Texas, South Dakota, or Florida.

  • Texas—If you choose Texas, first come visit the state and see if it’s a place you can return to on a regular basis. This would be where you would come to see doctors, lawyers, accountants. This is where you would have bank accounts. This is where you would vote. If you join Escapees in Texas, your new address would be Livingston, Texas. When you die, this is where your Will would be probated. Ready to “move” to Texas? Take a look at the Ten Commandments of Texas Domicile to start planning!
  • Florida—If you choose Florida, first go visit Florida. The same reasoning applies: This would be where you would come to see doctors, lawyers, accountants. This is where you would have bank accounts. This is where you would vote. If you join Escapees in Florida, your new address would be Bushnell, Florida. When you die, this is where your Will would be probated.
  • South Dakota – If you choose South Dakota, first go visit South Dakota. The same reasoning applies there as well: This would be where you would come to see doctors, lawyers, accountants. This is where you would have bank accounts. This is where you would vote. If you join Escapees in South Dakota, your new address would be Box Elder, South Dakota. When you die, this is where your Will would be probated.

Why South Dakota?

When first considering which of these three states would be best, many RVers gravitate towards South Dakota for the following reasons. Before you find yourself in the same position, consider these three points:

  • Because I don’t have to go back for 5 years.

     

    Someone calls and says they are choosing South Dakota as their new home.
    “Why?” I ask.
    “Because once I make it my home, I don’t have to go back for five years.”

    Now, that is true, under the South Dakota rules, you don’t have to return each year to register your vehicle. Florida and Texas command that you return on a more regular basis. But there’s another problem with this answer…

    If you “don’t have to go back for five years” how will you prove it’s your domicile? Domicile is defined as that place you “intend to call home.” Let’s say your old state was Minnesota. When they learn that you are now calling South Dakota home, the Minnesota taxing authorities write you a letter and say, “we don’t believe you really moved, prove it.”

    You have the burden of proof. Your proof is that you have nothing left in Minnesota, you sold your house and you left. But then they ask you to prove that you are now situated in South Dakota. You haven’t been back to that South Dakota since you first went there to register your vehicles and obtain your new dirver license. In that case, you may end up owing Minnesota back taxes and penalties as the Sanchez family did in the case on this very issue. See the case: Sanchez v. Comm. of Revenue, 770 N.W. 2nd 523 (Minn. 2009).

  • Because there’s only a 4% sales tax.

    I also get this call. Someone chooses South Dakota because the sales tax is only 4%. In Texas and Florida, it’s higher. That’s fine. I then ask the usual questions.

    “Have you ever been to South Dakota?” Usually there’s a long silence.

    “Do you plan to spend time in South Dakota?” Usually they express the idea that they are free, they live in their RV, they don’t want to be tied down.

    Then I say, “OK, where can you see yourself returning to on a regular basis?” The answer is usually NOT South Dakota. Occasionally, I talk to someone who really is attached to the state. One woman told me she thought her great-great-grandfather fought at Wounded Knee and she was spiritually drawn to the state. That made sense. Another person told me her daughter lived in South Dakota, but even her daughter questioned whether her mom should really call it “home.”

Does South Dakota still sound appealing? Check out our guide on the advantages of a South Dakota domicile. 

Which State is the Best State for Domicile?

We often are asked this question. “Just tell us where we should domicile.” As much as we wish there was a magic formula to use to answer this question, there isn’t one. This is a personal question. It depends on you, your lifestyle, your family. However, there are factors to consider when making this decision. We recommend that before you choose a new state for domicile, create a spreadsheet with everything you are now receiving that is state-specific, including such factors as sales tax, personal property tax, income tax, health insurance, vehicle insurance, all such factors and then compare it to those costs in other states. Sometimes the benefits you get from health insurance, for example, far outweigh the price you pay in income tax. Here are factors to consider.

Factors to Consider When Choosing Your Domicile State

  • Ease of Dealing with the state. One of the factors to consider is how easy is it to deal with this new state you are calling home.

    For example, how easy is it to register your vehicles? How easy is it to obtain a driver license? What about voting absentee. One of the obligations of domicile is jury duty. In some counties, if you are under a certain age, you will be summoned for jury duty. You may be able to claim that you are unavailable once, but the next time you will be mandated to appear. Because Livingston, Texas has been the headquarters of Escapees for so long, the district clerk’s office works with fulltime RVers to accommodate the lifestyle. The district clerk asks that you notify the court when you might be in the area so that they can put you on a jury panel.

    Other ease-of-dealing-with-the-state issues include how accessible are medical professionals and what about the conceal and carry laws.

  • Know About the Local Taxes. There are seven states without income tax. They are Alaska, Florida, Nevada, Texas, Wyoming, Washington and South Dakota. Two states, Tennessee and New Hampshire collect income tax on interest and dividends, but not wages and salaries.

    There are also five states that do not collect sales tax: Alaska, Montana, Delaware, New Hampshire and Oregon. Even though Alaska doesn’t collect sales tax, the counties of Alaska can collect sales tax and they do. So that needs to be explored.

    There are also state inheritance, gift and estate taxes. These have changed somewhat lately, but also differ greatly from state to state, so please explore this before choosing that new state of domicile.

  • Know How Your Assets will be Protected and Your Vehicles and Your Health will be insured. Every state differs in terms of health insurance, vehicle insurance and asset protection. You may have a very good Blue Cross Blue Shield program in, say, Virginia, but when you change your domicile to South Dakota, under their Blue Cross Blue Shield program you may find you have much less coverage at a higher price.

    The same is also true for your vehicle. Before choosing a new state for domicile, find out exactly what you now pay for your vehicle insurance and then explore what that same coverage will cost in the state where you might domicile. Sometimes, registration of your vehicle is less, but insurance is greater.

    For asset protection, you should determine whether there are good retirement plans available in that state and explore whether the state is a community property state, is personal property exempted. What about homestead exemptions, will they affect you? All of these factors will help you determine the best place to “call home.”

Staking Your Domicile Claim

Domicile is certainly an evolving area of law. The good news: not too long ago a person read one of our Domicile articles after receiving a letter from the California taxing authorities claiming that he was still domiciled in California when he had “moved” to Texas. He responded to the letter by claiming that he lived in Texas and then showing that he now had his vehicles registered in Texas, his driver license in Texas, he voted in Texas, he had his doctors in Texas, he joined the local clubs, etc. In sum, he did it, he did what was necessary to become a Texan and to no longer be a Californian. The California taxing authorities agreed with his analysis.

I sincerely hope this helps guide you in determining the most appropriate state for your domicile claim! When you’re ready to take the leap, you may find our Ultimate Guide to Establishing Domicile as an RVer helpful as you plan your next steps.  If you find you have more detailed questions about your specific situation, reach out to us at Loring & Associates for a consultation.

K. Susie Adams

Author

K. Susie Adams SKP #134068

K. Susie Adams has been a lawyer for over 30 years, spending 15 of those years working as a trial lawyer. She also taught legal writing at the University of Houston Law School. From 2011–2016, she was executive director of Childrenz Haven, the Child Advocacy Center of Polk County, Texas. Susie and her husband, James Frost, reside in Livingston, Texas.

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