Overview

States use two different concepts to decide who is a resident for income tax: domicile and statutory residency. Domicile focuses on where you intend your permanent home to be, while statutory residency is an objective, day-count or activity test. Which test applies—and which state wins—matters for where you must file, how much you pay, and whether you risk audits or penalties (see Tax Policy Center).

How domicile is determined

  • Primary factors: location of your primary home, where you spend most nights, where your immediate family lives, and your stated intent to remain (voter registration, driver’s license, vehicle registration).
  • Secondary ties: bank accounts, professional licenses, memberships, doctors, and where you maintain important records. No single factor is decisive; states weigh the totality of ties (see New York Dept. of Taxation and Finance).

How statutory residency works

  • Many states apply an objective day-count: commonly 183 days in a calendar year, though New York uses 184 for some tests and other states vary—always check the state rule. A non‑domiciliary who maintains a permanent place in the state and exceeds the day threshold can be treated as a resident for tax purposes.
  • Statutory residency ignores intent: even if you assert a new domicile elsewhere, the day-count test can trigger liability.

Practical examples (paraphrased)

  • Domicile example: Someone moves to a no-income-tax state but keeps a home, license, and voter registration in their old state. The old state may continue to treat them as domiciled there and tax their worldwide income.
  • Statutory example: A remote worker claims domicile in State A but spends more than the state’s day threshold in State B while keeping a place to stay there; State B may apply statutory residency rules and tax the worker as a resident.

Why this matters

  • Filing impact: Residents typically file a full resident return and pay tax on all income; nonresidents/part‑year residents report only in-state source income or the portion of the year they were resident.
  • Withholding and estimated tax: Wrong residency assumptions can lead to underwithholding or unexpected estimated-tax liabilities and penalties.

Practical steps to protect your position

  1. Document your intent to change domicile: update driver’s license, voter registration, and primary mailing address; transfer professional licenses and subscriptions; register your car; update estate documents. Keep copies and dates.
  2. Sever ties with the former state: sell or rent out the old home, close local accounts you won’t use, and move critical services to the new state.
  3. Track days accurately: use a day‑count spreadsheet or an app. Keep contemporaneous records (calendars, travel receipts).
  4. Adjust payroll withholding and estimated payments promptly when you move or begin spending significant time in another state.
  5. File correctly: if you split residency during the year, file part‑year returns and prorate income where required.

Evidence useful in an audit

  • Driver’s license and voter registration dates; utility bills; lease or deed; mortgage or rental agreements; property tax bills; mail forwarding requests; travel records and calendars; employment location and employer correspondence.

Common mistakes to avoid

  • Assuming intent alone is enough: states evaluate objective ties, not just your belief.
  • Ignoring statutory-day rules: spending more than the threshold can trigger residency regardless of domicile claims.
  • Failing to update withholding: employers may keep withholding based on old residence information.

When to get professional help

  • If you split time across states with different tax rules (or high-tax states like New York that actively audit), consult a CPA or tax attorney for a residency analysis and audit defense. Complex situations—second homes, business operations in multiple states, or substantial investment income—benefit from tailored advice.

Further reading and tools

Authoritative sources and further research

  • Tax Policy Center, Overview of state residency rules (taxpolicycenter.org).
  • New York Department of Taxation and Finance—residency guidance (tax.ny.gov) for New York’s specific statutory tests.
  • State Department of Revenue pages for your states—rules and day-count thresholds vary by state; always confirm on the official state website.

Professional disclaimer

This article is educational and does not replace personalized tax advice. Residency rules are fact‑specific; consult a licensed CPA or tax attorney before changing domicile or relying on statutory exceptions.

Last reviewed: 2025