Home Sweet Home: Where’s Yours?
There are many reasons for owning two residences: to take advantage of a different climate, maintain roots near the family home, run a business in a second location or just to get away from it all. Whatever the reason, some people find themselves spending more of their time at their “home away from home” as they near retirement.
If you own a second home, make sure you don’t unintentionally “move” by spending too much time there. Such a relocation could be detrimental to the health of your estate plans and end up costing unnecessary expenses.
It’s important to know your domicile — your usual place of residence. It’s possible to have several homes, but you can have only one domicile. This is the state whose laws will govern the distribution of your estate at death. If that state happens to have its own estate tax or inheritance tax (Connecticut, Washington D.C., Delaware, Hawaii, Illinois, Iowa, Kentucky, Maine, Maryland, Massachusetts, Minnesota, Nebraska, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Washington), it could mean less for your beneficiaries. And if your will doesn’t comply with the probate laws in your state of domicile, your assets may pass under state laws for those dying without a will.
There are a number of factors used to determine domicile: where you spend the most time, are registered to vote, licensed to drive, own real estate, file income tax returns. Check with your attorney if you have any questions about where you’re domiciled or the consequences of spending more time at a second home.