SD Address, yay or nay?

[philh]

Sold our B&M. Have a park model permanently parked in a campground. Buying a SD and 5th wheel in the fall. Still working, but this working from home is working out pretty good so far.

Getting a lot of recommendations to set up a legal domicile in SD and corp in Montana for buying the new truck and 5th wheel.

[agesilaus]

Depends on the state and your income bracket. The state can determine from credit card receipts and other financial records where you've been. But it's unlikely that they will make the effort unless you pay a lot of taxes. There are some real horror stories out there, mainly from CA, IL and NY of the extremes they will go to pursuing someone.

"A California resident is anyone in the state for other than a temporary or transitory purpose. It also includes anyone domiciled in California who is outside the state for a temporary or transitory purpose. The burden is on you to show that you are not a Californian. If you are in California for more than 9 months, you are presumed to be a resident. Yet if your job requires you to be outside the state, it usually takes 18 months to be presumed no longer a resident."

Forbes

New York and California, collecting income taxes from individuals who are unable to prove that they did not cross the 183 day threshold has become a big revenue driver. New York, for example, collected $1 billion from residency audits from 2013 – 2017, which is 4 times more than S Corp/Partnership audits.

resdency audit

[jimbo4UT]

Hum I read all the replies and have to wonder how a state knows how long you stay there? We just notified Virginia on 11-6-2020 that we are now domicile out of Florida and I even gave them my good sams address in Florida even though they did not ask for it. I also explained that my house was going thru a remodel so we could sell it. All they ask I do is notify them if I changed my mind so they could renew my tags on the motor home and car otherwise I would have to do to dmv all over again. I love reading all the different topics on here but honestly several who post on here go into overkill. We already have a dmv in Florida we are going to in May to change our licenses and tags. After I get them I doubt I set foot back in Florida for a few years.

[Lwiddis]

What does your tax professional..CPA, EA etc... say? Don’t wing it.

[phillyg]

Go over to the Escapees forum and investigate their mail services to SD, TX and FL residents. You need to divorce your current domicile and obtain drivers licenses, insurances, professional connections, pay taxes if any, doctors, banking, etc., in the new state. No state can hold you hostage, but you have to be a resident somewhere. The MT LLC has been around for years, but last I heard, aggressive tax states like CA, NY, MI, will try to collect if you spend more than x days in-state with your MT-registered RV.

[PawPaw_n_Gram]

Other than truck taxes, consider state income tax.

Where is your job? i.e. The place where your W-2 or W-9 is issued.

My father worked in Louisiana until he was 49, and in Texas from ages 50-65. Yet he always owned the same home in Arkansas. Until his job in LA ended with a plant closure, he always had to file both LA and AR income tax. There was an offset to his AR tax for LA tax paid.

After, he had to file AR income tax and pay on the Texas income.

SD doesn't have a state income tax, but changing your domicile to there might draw closer scrutiny of Michigan tax ......

[wanderingaimles]

If you will be travelling extensively, having a mail service like Dakota Post has benefits, my meds are delivered to them in 3 month batchs and they forward to where I wish when I'm ready. The registration of your vehicles there, eliminates a need to return for state inspections and no emissions test.
Yes you pay more for registration on larger vehicles, (my MH is about $260 a year) but no income tax and the conveniences i mentioned make it worthwhile to me.

[valhalla360]

Where are you actually going to live?

If you are constantly on the road moving around, it can be a good option.

One item to watch is are you still officially assigned to Michigan in terms of work? It could be a red flag if you are working in Michigan but "residing" in South Dakota. The tax man has a tendency to assume you are guilty until you prove otherwise...so if you are really living 6 months of the year in a Michigan park, don't be surprised if they catch you at it.

Also, don't be surprised if they question the Montana LLC if there is no indication of actually having any relationship with Montana beyond using it as a tax dodge.

[jorbill2or]

Unless you have substantial income or assets to protect, and a tax lawyer to advise I’d probably not complicate matters. You have a fixed house Park model in the state your work base is even if you work from home and are looking to establish a domicile in South Dakota , and a LLC in Montana. Sounds like trouble without some serious legal consultation

[bucky]

All states are going to get their money one way or the other. Taxes are like hand cuffs. The more you struggle the tighter they make them.

[Old-Biscuit]

MT LLC info...you decide

[navigator2346]

If you buy in MT and then register in SD, you will be paying sales tax. More importantly, you need to consider your medical insurance coverage

[agesilaus]

The state tax people are very aware of the Montana tax dodge and may come after you if you are still actually living in MI. Cali has actually declared that if you live or reside in Cali for 100 days then you owe them taxes. Most states are 6 months and a day makes you a resident, I think but I am not a lawyer.