Tax Type
Individual Income Tax
Description
Change of domicile
Topic
Residency
Date Issued
09-22-1988
September 22, 1988
Re: §58.1-1821 Application/Individual Income Tax
Dear****************
This will reply to your letter dated July 13, 1988 in which you seek the correction of individual income tax assessed for taxable years 1983 and 1984.
FACTS
************** hereinafter referred to as the taxpayer, was held liable for additional individual income tax on his Virginia returns as a result of adjustments made on his 1983 and 1984 federal income tax returns. The taxpayer is an electrician, owns a home in Virginia and votes in Virginia. During 1982, the taxpayer accepted employment with the to work on the************ and established living quarters in New Jersey until the project was completed in December 1985. The taxpayer was informed when he was hired that the project had an estimated completion date of January 1985. The taxpayer is a member of Local *************** and signed the books at the New Jersey site as a traveler (a union member who is not a member of the local union). The taxpayer continued to maintain his personal residence in the ******* area during his employment with the ******** and returned to the area whenever possible to seek employment.
The taxpayer claimed various travel and housing expenses while in New Jersey as part of his employee business expense deduction. However, the Internal Revenue Service declared New Jersey his "tax home". Accordingly, the travel and housing expenses claimed for 1983 and 1984 were disallowed as nondeductible personal expenses. The taxpayer contends that he is a resident of New Jersey for 1983 and 1984, and not a resident of Virginia.
Therefore, he is not liable for filing a Virginia resident individual income tax return and due a refund for taxable years 1983 and 1984.
DETERMINATION
For purposes of determining income tax liability in Virginia, there are two types of residents: (1) domiciliary and (2) actual. Both of these types of residents are subject to the Virginia individual income tax.
A domiciliary resident is one whose legal domicile is Virginia. §58.1-302 of the Code of Va. defines domicile as "the permanent place of residence of a taxpayer and the place to which he intends to return even though he may actually reside elsewhere. Any person who has not moved from the state with the intention of permanently residing outside of Virginia is still a domiciliary resident even though he may actually be living some place else.
An actual resident is any individual who is not domiciled in this state but who maintains a place of abode in Virginia for more than 183 days during the taxable year. An individual may be an actual resident of Virginia even though he retains his legal domicile elsewhere. Additionally, while an individual may have only one legal domicile at one time, he may have more than one residence.
In the present case, several factors indicate that the taxpayer maintained Virginia as his legal domicile while working in New Jersey. The taxpayer continued to maintain his personal residence in ***** and returned to his home there as often as possible to find employment. The taxpayer maintained his membership with the local union in **** and signed the books at the New Jersey site as a traveler. In addition, the taxpayer has stated that it was his intent to return to the**** area if he could find employment.
A mere absence from one's fixed home, however long continued, cannot change one's domicile. The Virginia Supreme Court in State-Planters Bank v. Commonwealth of Virginia, 174 Va. 289 (1940) stated that "Domicile is residence at a particular place, accompanied by intention to remain there for an unlimited time. Both residence and intention to remain there must concur to constitute domicile....Mere change of place or absence from a fixed home does not work a change of domicile." Accordingly, sufficient basis exists for Virginia to hold the taxpayer liable for Virginia individual income tax as a domiciliary resident for taxable Years 1983 and 1984.
Therefore, based upon the facts presented, I find no basis for granting relief of individual income tax assessed the taxpayer for adjustments made to his 1983 and 1984 income tax returns. The taxpayer will shortly receive an updated bill with interest accrued to date. This bill should be paid within thirty days to avoid the accrual of additional interest.
If you have further questions regarding the issues discussed herein, please do not hesitate to contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner