It's Not the Sunshine: Why Snowbirds Become Floridians

BOCA RATON, Fla., Feb. 6 /PRNewswire/ -- For many snowbirds lured to Florida, the biggest attraction is not the presence of sunshine.  It's the absence of Florida estate taxes.

Many snowbirds who own homes in both New York and Florida are changing their domicile to Florida according to Attorney Allan R. Lipman who is licensed both in New York and Florida.

These not only include individuals who have been stung by the recent increases in New York income taxes but also retirees with more modest incomes who want to avoid estate taxes. Lipman cites the example of two hypothetical brothers, Sam and Larry.

Sam and Larry both died in 2009.  Sam's children paid estate taxes of $16,364; Larry's children paid estate taxes of $212,835, yet they both lived in condos in Florida and New York valued at $250,000 each.  Sam's other assets consisted of a securities portfolio of $3 Million.  Coincidentally, Larry's other assets also consisted of securities of the same value. They both stayed in Florida about half the year and spent the other half in New York.

Why the difference in estate taxes?  The answer: Sam changed his domicile to Florida that has no estate tax and his children only paid a New York estate tax on the New York condo.  Larry remained domiciled in New York and his children paid New York estate taxes on all of his assets except the Florida condo.

In any calendar year where Sam did not stay in New York more than six months, he was able to avoid New York income taxes.  This often happened because Sam liked to travel during part of the summer.  Since Florida has no state income tax, he only paid Federal income taxes. Larry paid New York income taxes on the interest, dividends and gains from his securities even though he also went on trips and during some years was in New York less than six months.  As an additional bonus, Sam was able to cap the real estate taxes on his Florida condo which was his homestead while Larry was not able to do so because his Florida condo was not his homestead.

Lipman, who has written a book on the subject, conducts a seminar on his website for snowbirds who have changed their domicile to Florida or are contemplating doing so. To listen, go to www.snowbirdguide.com.  At the website, Lipman has also made available the entire updated contents of his book which is no longer in print.  

For further information or to arrange an interview, contact:

Allan R. Lipman at [email protected].

SOURCE Allan R. Lipman