Buying a home in Florida is an aspiration for many retirees who have dealt with cold and snowy winters for too long. While spending winters in the Sunshine State means the end of shoveling snow from your walk and maneuvering along icy roads, there are reasons to consider establishing Florida residency instead of just using it as a second home. With it comes some financial perks that make this lifestyle change worthwhile. In addition to saving money on a snow-blower, what makes this attractive is that Florida does not have a state income tax or a state inheritance tax and the Florida Homestead Exemption means you don’t have to pay property tax on up to $50,000 of the assessed value of your permanent home.

To maintain permanent resident status, you must live in Florida for 183 days out of the year; and it’s important to have documentation that supports the fact that you spend most of the year in Florida. Beyond carefully documenting your move, we suggest you have an attorney who is licensed to practice law in Florida revise and update your estate plan to conform to your new state’s laws. Once you’ve found your new local medical professionals, be sure to have your records forwarded to them.

Here are seven steps you should take to help prove your change in residency if it’s ever challenged by a taxing authority. 

  • If you maintain a second home elsewhere, keep detailed records of where you spend your time.
  • Update your legal address on all documents, like passports, insurance contacts, pension benefits, etc., to reflect your Florida address.
  • Obtain a Florida driver’s license and return the license from your former state. Switch your registration, insurance and plates to Florida, too.
  • Change your voter registration and vote in the next election. Have your name removed from the registration roll of your former state.
  • File a Declaration of Domicile with the Clerk of the Circuit Court and mail a copy to the tax authority in your former state.
  • File a final tax return in the state from which you are moving and begin filing tax returns in Florida. If you derive income in another state and are required to file a return in that state, do so as a non-resident using your Florida address.
  • Begin using a Florida branch of your national bank for your financial needs, or establish a new relationship with a local bank. Move items to a Florida-based safety deposit box. Make sure any income (Social Security, pensions, annuities, dividends, rent, royalties, etc.) is deposited in the local branch.

 

By paying close attention to these steps, you’ll be able to focus more of your energy on the golf course, soaking up some sun and becoming more involved in your new community. Isn’t that what retirement is all about?

Thinking of making the big move? Contact Wescott Financial Advisory Services to assist you in your decision-making process.