We get it ! Managing residency in two states can be quite a puzzle. But don’t worry; we’re here to discuss the top ten steps to stay a full-time resident in Michigan and avoid any part-time residency hassle in California:
1. Establish Domicile in Michigan: To make Michigan your permanent home, consider these actions:
- Register to vote in Michigan
- Obtain a Michigan driver’s license
- Change your address on all official documents
- Maintain a permanent home in Michigan
- Spend more than 183 days per year in Michigan
2. Sever Ties with California: Eliminate any California-related factors:
- Sell or rent out your California home
- Close any California bank or investment accounts
- Cancel California memberships or subscriptions
- Transfer your car registration to Michigan
- Change your mailing address to your Michigan address
3. Keep Detailed Records: Maintain records of your time spent in each state:
- Keep a daily or weekly calendar
- Retain receipts for travel expenses
- Save copies of airline tickets, hotel bills, and rental agreements
4. Understand California’s Residency Rules: Be aware of California’s residency criteria, including:
- The physical presence test (over 183 days)
- The domicile test (intent to make California permanent home)
- The other factors test (job, property, family location)
5. Be Prepared to Defend Your Residency: Gather documentation to support your claims:
- Copies of your Michigan driver’s license, voter registration, and other official documents
- Proof of ties to Michigan, such as property ownership, employment records, and school records
- Evidence of your intent to make Michigan your permanent home
6. File Your Michigan Tax Return On Time: Timely filing of your Michigan tax return demonstrates your commitment to Michigan residency.
7. Pay Your Michigan Taxes in Full: Meeting your Michigan tax obligations further establishes your Michigan residency.
8. Be Aware of the California Franchise Tax Board’s Audit Program: Stay informed about the potential for audits by the California Franchise Tax Board (FTB) and prepare accordingly.
9. Keep Up-to-Date on California’s Residency Laws: Regularly monitor California’s residency laws, as they may change, ensuring you remain compliant with the FTB.
10. Consult with a Tax Advisor: Seek guidance from a tax advisor to understand residency rules and strategies to avoid being considered a resident of California.
Seize your multi-state residency solution! Schedule your consultation here, REGARDLESS OF YOUR STATE!