So you want to buy or rent a home in Florida to avoid those pesky state taxes and endless winters? All I can say is, "Welcome. What took you so long"?
Let's start with the basics of how to accomplish this goal.
The IRS defines where you officially live (Domicile) as follows: "Your domicile is a permanent legal home that you intend to use for an indefinite or unlimited period, and to which, when absent, you intend to return". This can be a subjective concept so you will want to complete as many of the steps below as possible to bolster your case.
What if you are a Snowbird or own multiple vacation homes? A person can only declare residency in one place/Domicile no matter how many homes they own or rent.
Step 1. File a Florida Declaration of Domicile
A Florida "Declaration of Domicile" is a document that you file to declare that you are an official resident of Florida because you reside in, maintain a place of residence here as your permanent home. Each County has its own form.
You are confirming that your residence in the State of Florida constitutes your "predominant and principal" home.
The Florida Declaration of Domicile must be signed by you in front of a notary public or the deputy clerk of a Florida court. It must then be recorded in the public records of the Florida county where you reside.
Step 1: The Requirements For Filing Are Simple
Identification, if resident alien green card number must be placed on the form. For naturalized citizens, the certificate number must be on the form.
$10.00 recording fee
Additional $3.00 for a certified copy
A self-addressed stamped envelope must be provided in person or by mail.
The application must be notarized prior to submission to the County Recorder's Office.
The turnaround time should be approximately two weeks to receive it back after sending it to the recorders office.
Here are links to the most common Counties Declaration of Domicile Forms
If you drive or intend to drive, you must have a valid Florida driver's license. As an added bonus, it will provide evidence to the state you're trying to cut ties with that you've officially moved. As a new Florida resident, you must obtain a valid Florida driver license within 30 days of establishing residency, including but not limited to filing your Declaration of Domicile, to drive on Florida roads. Car insurance is expensive in Florida, so why risk getting a ticket?
If you don't drive, consider getting a Florida non-driver ID card instead.
What Do You Need to Bring?
You'll need proof of your Social Security number, and
two documents that show your Florida address.
Make sure you allow 2.5hrs -3 hrs for this process. Lines are really long due to the amount of people moving down to Florida daily. Going on a rainy day helps, as less people are out and about.
Step 3: Register Your Vehicles
You should also register your automobiles, golf carts, boats, motorcyles, etc that are located in Florida with the Department of Motor Vehicles. Florida requires that you take your vehicle to the DMV office for verification of the vehicle identification number. However, did you know you can register your vehicle from your home state? There are many ways to accomplish this task easily, including downloading a form and taking the car to your local Police station. Click Here for more details.
Take care of this while at the DMV getting your driver's license or ID card. They should provide you with a voter registration form at the same time. If not, ask for one. Registering is good, but actually voting is even better. Remember that voter registration books close 30 days before an election.
Step 5: Open Local Bank Accounts
Transfer at least one out-of-state account to a Florida banking institution. It's a good idea to do this with all your financial accounts, although some might be located in states you never lived in. This is OK. Just make sure those in your old state or states of residence are transferred.
Step 6: Notify the IRS, State Taxing Officials, and Social Security Administration.
File final income tax returns in any states where you're required to pay income taxes. Notify those state taxing officials of your move to Florida.
List your Florida address as your residence for federal income tax purposes, then file your return with the Internal Revenue Service Center in Charlotte, NC 28201.
Step 7: Buy and home! If you do, apply for a Homestead Exemption.
Apply for the Florida Homestead Exemption if you purchase a home rather than rent one. This will help to establish your domicile in Florida and it will also provide real estate tax benefits and asset protection.
The Florida Save Our Home Act provides that if you qualify for a homestead exemption, $50,000 of your assessed property value is exempt from taxation. If property taxes are imposed by a school district, the exemption is $25,000. And your property's assessed value is limited to 3% increases per year. This can provide huge saving to you when you buy your dream home.
Step 8: DON'T Forget to Update your Estate Plan!
Now that you're a Florida resident, Florida law will govern your estate planning documents. Florida also enacted a new power of attorney law in October 2011 that you'll want to be aware of. It's a bit different from power of attorney laws in other states, and Florida also has some quirky laws with regard to who can be your executor, and who you can and can't leave your primary homestead residence to. So it's important to use Florida professionals, such as attorneys, accountants, and financial advisors, to draft these updated documents whenever possible.
Remember, you don't have to do everything on the list, but the more you can bolster your case the better.
If your looking to get started renting, or buying a home, please reach out to me by calling 561-320-1474, or fill out the contact form.