Snowbirds and residency for state tax purposes: 3 things to know

Many people with financial means, including many retirees, escape northern climes this time of year for sunnier vistas in Florida, Arizona or elsewhere.

It’s a great way to avoid the hassle of snow and ice while working on your golf game or enjoying other amenities allowed by warmer weather.

But what state tax obligations are in play when you spend a substantial amount of time in more than one state? Here are three important things to know.

Maryland uses the 183-day rule on physical presence for state tax purposes.

Like many other states, Maryland uses the so-called 183-day rule to determine residency for state tax purposes.

If your permanent home is in Maryland, or you maintain a placed to live there for more than six months of the year, Maryland will be looking to tax you as a full-year resident.

This rule is operative for those who were physically present in the state for 183 days or more. In other words, if you spend more than half the year there, Maryland will be looking for you to file a full-year resident return.

There are national rankings on which states are most (or least) tax-friendly for retirees.

The respected financial publication Kiplinger’s compiles national rankings on how states vary in taxes on retirees.

For example, Kiplinger’s views Florida as tax-friendly. Arizona, however, ranks as an intermediate status of “mixed,” according to Kiplinger’s.

Retirees sometimes get in trouble with tax authorities by claiming their home in Florida or another sunbelt state as a permanent residence.

It’s not uncommon for snowbird retirees to buy a second home in the warmer-weather state.

In many case, this state will have lower income taxes than where you spend the rest of the year. If you claim your warm-weather home as your permanent residence, it can lead to conflict with revenue authorities in those places, such as Maryland, Virginia or the District of Columbia.

You’ll need to be prepared for a possible tax audit by those authorities.

 

No Comments

Leave a comment
Comment Information
Email Our Team

Contact Us to Get Started Today

Located in the Washington, D.C area, we serve clients in the District of Columbia, Maryland and Northern Virginia, as well as across the country and overseas. For a free initial consultation, call 202-381-1261 or complete our brief online form.

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Six Convenient Office Locations in and around the DC Metropolitan Area

Washington, D.C.
1050 Connecticut Ave NW #500
Washington, D.C. 20036

Phone: 202-618-1873
Fax: 888-235-8405
Washington Law Office Map

Columbia Office
10440 Little Patuxent Parkway, Suite 300
Columbia, MD 21044

Phone: 202-618-1873
Phone: 410-497-5947
Fax: 888-235-8405
Columbia Law Office Map

Annapolis Office
839 Bestgate Road
Suite 400
Annapolis, MD 21401

Phone: 202-618-1873
Phone: 410-497-5947
Fax: 888-235-8405
Annapolis Law Office Map

Fairfax Office
8280 Willow Oaks Corporate Drive
Suite 600
Fairfax, VA 22031

Phone: 202-618-1873
Phone: 703-988-4817
Fax: 888-235-8405
Fairfax Law Office Map

Rockville Office
199 E. Montgomery Avenue
Suite 100
Rockville, MD 20850

Phone: 202-618-1873
Phone: 240-599-5009
Fax: 888-235-8405
Rockville Law Office Map

Baltimore Office
400 East Pratt Street
8th Floor
Baltimore, MD 21202

Phone: 202-618-1873
Phone: 443-743-3381
Fax: 888-235-8405
Baltimore Law Office Map