Establishing Residency in Florida is a Key Part of Retiring Here
It is easy to see why Florida is such a popular place to retire: Our year-round warm weather and low cost of living are attractive places for retirees to spend this chapter of their lives.
Many Florida retirees do not realize all they have to do to become “official” Florida residents and reap the benefits that come with living here. This can cause them to have to continue to pay taxes in their original states. Although you can be a part-time resident of multiple states, if you want Florida’s tax and estate rules to apply to your estate, you must be domiciled in Florida. This is a key part of estate planning.
Tax Benefits of Domiciling in Florida
A primary reason why many retirees choose to move to Florida and domicile themselves here is the tax benefits the state provides. These are:
- No individual income tax. Florida is one of only seven states that does not collect individual income taxes, which makes it attractive to individuals who want to keep more of their paychecks;
- No estate or inheritance tax; and
- Favorable tax treatment for primary residences, known as “homestead” residences in Florida. The Save Our Homes provision in the Florida constitution limits the amount of appreciated value in a homestead which is subject to property taxes.
How to Establish Florida Residency
Simply owning a home in Florida is not enough to reap the benefits of being domiciled in Florida. In order to establish Florida as your domicile, you must take proactive steps to do so. These include:
- Altering your estate planning documents to reflect Florida as your state of residence, rather than your previous state. Remember to do this on your will and any trusts you own;
- Register your vehicle in Florida;
- Register to vote;
- Change over your official documents, like your driver’s license, to Florida documents;
- File a Declaration of Domicile with the circuit court of the Florida county where you reside;
- File for a homestead exemption on your Florida residence. This will help solidify it as your permanent residence; and
- Transfer your financial accounts to Florida banks and brokerages. If you currently bank with an institution that is in Florida as well as other states then change the address you have on file for each of your accounts to reflect your Florida address.
Becoming a Florida resident does not mean you have to give up the property you own in other states. It does, however, mean you must give up the homestead exemption you have for another property.
Work with an Experienced Fort Lauderdale Estate Planning Lawyer
At The Law Offices of Gregory W. Kabel, P.A., we work with individuals and couples in nearly every type of situation imaginable to plan effectively for retirement. Whether you are single, married, cohabitating, divorced, raising minor children, or part of the LGBTQ community, we are equipped to help you plan for a comfortable, happy retirement. Contact our firm today to set up your initial legal consultation with one of the estate planning lawyers at our firm.