Tax Type
Individual Income Tax
Description
Retention of Virginia domicile during foreign absence
Topic
Persons Subject to Tax
Residency
Date Issued
12-12-1984
December 12, 1984
Re: Request for Ruling/Individual Income Tax
Dear ****
This will reply to your letter of July 12, 1984 in which you submit a request for a ruling on behalf of your client, *****.
FACTS
***** (hereinafter "Taxpayer") changed his place of abode from Virginia to Thailand in November 1978 in order to fulfill an assignment on behalf of the United States government. While present in Thailand, the taxpayer had shipped all of his household and personal belongings, including his automobile, to his new place of abode. In addition to obtaining a Thai driver's license, the taxpayer profited from various Thai investments and remitted Thai taxes on interest income derived in that country. Lastly, the taxpayer wed a Thai national in 1980.
While in Thailand, the taxpayer maintained rental property in Virginia, including his former home, as well as a Virginia bank account and a bank account in the State of Washington. In addition, the taxpayer retained his Virginia driver's license, but did not exercise the right to vote in Virginia elections while in Thailand.
In March 1983, the taxpayer left the government's employ and returned to Virginia where his mother lived. Several months later, the taxpayer found employment in Virginia and remains in the state. The taxpayer submits a request for a ruling on the applicability of the Virginia individual income tax to him for the years 1979 through 1982.
RULING
The question to be answered here is whether the taxpayer abandoned his Virginia domicile when he took up a place of abode outside of this state. Obviously, the taxpayer did not reside in Virginia during the period from October 1978 to March 1983; however, domicile has a broader and more comprehensive meaning than residence. Residence, together with the requisite intent to remain, is necessary to preserve a domicile after it is once acquired. Consequently, one may be a resident of one jurisdiction while having a domicile in another. While every person has one and only one domicile, a person may have no place which can be called his residence or he may have several such places. Accordingly, the mere change of place does not change one's domicile. The Virginia Supreme Court of Appeals in Lindsay v. Murphy 76 Va. 428 (1882) established the principle that "Mere absence from a fixed home; however long continued, cannot work the change. To constitute a new domicile, two things must concur-first, residence in the new locality; second, the intention to remain there. Until a new domicile is established, the old one remains; and whenever a change of domicile is alleged, the burden of proving it rests on the party alleging it."
Additionally, the Virginia Supreme Court stated the following in State Planters Bank v. Commonwealth of Virginia 174 Va. 289, 6 S.E. 2d 629 (1940):-
- If...a person is abiding at a particular place and while so abiding forms an intention to make it his home permanently or for an indefinite period, and continues to remain there in pursuance of such intent he thus acquires a new domicile.
Accordingly, the intent of the person is in question. "Intent must frequently be determined from the declarations and conduct of the person in light of the attending circumstances" stated the court in State Planters. The United States Supreme Court ruled in District of Columbia v. Murphy 314 U.S. 441 (1941) that the permanence of a domicile in a previous location along with other declarations and circumstances, can be indicative of a person's intention to return to his former state of residence in the future.
The court in District of Columbia v. Murphy, supra further stated the following:
All facts which go to show the relations retained to one's former place of abode are relevant in determining domicile. What bridges have been kept and what have been burned? Does he retain a place of abode there or is there a family home with which he retains identity? Does he have investments in local property or enterprise which attach him to the community? How permanent was his domicile in the community from which he came? Would a return to the old community pick us threads of close association?
Lastly, § 58-151.02(e)(1)(iii) of the Code of Virginia clearly sets forth the factors to be used in determining one's domicile:-
- The fact that a person has removed his abode to a place without this State is not conclusive evidence of a change of domicile. In determining domicile, consideration may be given to the applicant's expressed intent, conduct, and all attendant circumstances including, but not limited to, financial independence, business pursuits, employment, income sources, residence for federal income tax purposes, marital status, residence of parents, spouse and children, if any, leasehold, sites of personal and real property owned by the applicant, motor vehicle and other personal property registration, residence for purposes of voting as proven by registration to vote, if any, and such other factors as may reasonably be deemed necessary to determine the person's domicile.
Based upon the foregoing, several factors would seem to suggest that the taxpayer maintained a Virginia domicile during the period of his Thai residence. Virginia continued to be the home of the taxpayer's mother and the taxpayer retained his Virginia home and rental property while in Thailand. This would suggest that there were still threads of close association to Virginia to which he could easily, and in fact did, return to. In addition, the taxpayer maintained a Virginia bank account and driver's license. Accordingly, I must rule that the taxpayer retained his Virginia domicile during the years 1979 to 1982 and is therefore liable for the Virginia income tax as a resident of the state during those years.
Sincerely,
W. H. Forst
State Tax Commissioner-
Rulings of the Tax Commissioner