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JimM68's avatar
JimM68
Explorer
Jun 04, 2015

Counting down and domicile questions

We have a solid contract on our house, and will be full time on July 24!

(Yeah!!!)

I have some serious wondering about this whole domicile question?

I know that the most popular states are Texas, Florida, and South Dakota, but why?
Info is hard to find, other than "we don't give legal advice" and (from Escapee's) "we now offer services in all three of those states, so send us money..."

We are currently residents of Illinois. Our income tax rate is 3%, and it costs $100/year to renew the plates on our motorhome.

My company is a Montana LLC. We have had a mail forwarding company in Montana for years, sending our personal mail there will cost me nothing.

The company's physical Location will remain Illinois, and as long as that is true, we will have to file and pay personal taxes in Illinois. We do split the income between Illinois and Montana.

Our current health plan (Illinois bcbs bronze 006) cost is very low and nationwide network.

So my questions are:
Do we have much to gain by moving out of Illinois?
Why don't RVers domicile in Montana anymore?
Is there anything to gain by "moving to Texas"?

And what does mail forwarding have to do with any of this?
When I go on Escapee's website, step one is "pick one of these three states"
and step two is "send escapee's money for mail forwarding in your choice of those 3 states"

What does mail forwarding have to do with domicile and address?
(south Dakota will accept a campground receipt, no mention of where you get your mail...)

Am I overcomplicating this?

and please don't say "hire a lawyer", I'm one who believes that the world would be a better place if all lawyers (and politicians, who are all just failed lawyers anyway) had died on the Titanic.
  • jrp's avatar
    jrp
    Explorer
    Jun 04, 2015
    congrats and your smile will only get bigger.

    1) why Fl,SD,Tx - primarily because these 3 meet all the major concerns of most fulltimers - no state income tax, they are fulltimer friendly, they accept a mail forwarding address as your official address (not all states will), and they have existing professional mail forwarders.

    2)will you gain much by moving - for your unique circumstances, other than a personal income tax reduction, it doesn't sound like it

    3)why not Mt - Mt requires its residents to have a physical street address

    4) any advantage to Tx - depends on individual circumstances - for those who have no preference to other states, & not already covered by health insur elsewhere, Tx has more acceptable options for private individual health plans than SD. and some see the Escapees organization as an advantage to TX

    5) what does mail forwarding have to do with domicile - as a fulltimer with no real home, and constantly on the move, your mail forwarding address acts as your official home address; for license, registration, insurance, taxes, etc

    6) (south Dakota will accept a campground receipt, no mention of where you get your mail...) -
    2 separate issues, the campground receipt is part of SD's exception for fulltimers to comply with the Federal Real ID Law, where you have to show documentation to prove who you are and where you live. It has nothing to do with your official address, which is provided by your mail forwarder.
  • BarbaraOK's avatar
    BarbaraOK
    Explorer
    Jun 04, 2015
    One thing that the mail forwarders do is provide an address for things like VOTING, registering vehicles, drivers licenses, insurance, jury duty, etc. If you stay residents of Illinois what will you do for an address? Will the state recognize that address for voting? Will an insurance company accept that for a 'garaged' address to calculate insurance premiums; will a health insurance company accept that address as your legal address? What does the mail forwarder in Illinois know about the fulltime life style?

    Let me turn the question back to you. Why are you so upset with this process? Of course Escapees will charge you money to set up your address, etc. So will any other mail forwarder. As long as you are using the business umbrella, most of this won't apply to you - so why are you so angry at companies that do provide that for others that are fulltiming? BTW - will MT excuse you from jury duty and allow you to vote using the company's 'address' in MT? You might want to check that out. And will MT allow you to get drivers licenses based upon that address? Again, you need to check that out.

    Barb
  • Executive45's avatar
    Executive45
    Explorer III
    Jun 04, 2015
    Jim covered most of the issues already and did a good job. Some caveats regarding SD, (I can't speak for Texas) SD does have a 'wheel tax' for many of it's counties. We use Americas Mailbox in Pennington County which has no tax. SD has no income tax and only a 3% sales tax. (important if you're buying a new rig for full timing). You already have a Montana LLC so you know the rules there, or you just haven't been caught yet...:W...

    Unless you're going to continue to work in your business you can choose your domicile State. That said, whatever state you choose, be sure to commit to that State. This means moving ALL your correspondence to that State...i.e. driver's license, registration, bank accounts voter registration etc. The IRS, which is the driving force looks at your "intent" in establishing residency. Just because your rig is reg in Montana does not make you a Montana resident. You establish your 'intent' by doing the aforementioned things.

    Finally, check your medical plans. If you're on medicare, often the level of coverage is dependent on where you live. Choose this wisely so you will have coverage if traveling in another state.

    Same deal with insurance on your rig. Only a handful of insurance companies will give you full timer coverage. Yes, you can get regular coverage but full timer coverage is like a homeowner's and car insurance policy. (covers you if someone gets hurt while visiting you and also covers other perils not covered with reg auto insurance)..good luck and safe travels...Dennis
  • stickdog's avatar
    stickdog
    Explorer
    Jun 04, 2015
    The only reason we left Illinois and relocated to SD was that we were in the Chicago Metro area and did not want to return for Air Quality vehicle testing.
    If you are not on Medicare or have nationwide health coverage, SD the last I read did not offer any nationwide health care plans. We have BCBS from retirement plan so that does not bother us.
    If I were you I'd stay in Illinois. We did save a little on vehicle insurance it covers the cost of the mail service.
  • jrp's avatar
    jrp
    Explorer
    Jun 04, 2015
    on the SD vehicle sales/excise tax - SD's very low 3% was recently raised, as of 4/1/2015 to a still very low 4%
  • lbrjet's avatar
    lbrjet
    Explorer
    Jun 04, 2015
    I hope you have a PPO insurance policy if you plan on using it for non life threatening care outside of Illinois.
  • retispcsi's avatar
    retispcsi
    Explorer
    Jun 04, 2015
    We fulltime and use Florida. It was an easy decision since we have been residents for ten years. Sold our home last July. You can contact the Tax Collector in any Fl. County and they will tell you the cost for title, registration etc. Vehicle matters are handled through their office. There is no state income tax. There are no yearly inspections. There is no requirements to spend anytime in the state to maintain residence. You do not need any special license or endorsements. I can't help you with health insurance. We use Good Sam's mail forwarding. I believe any of them are great. Another Fla. perk, if you are a resident and are 65 or 100% disabled the state parks are half price.
  • rockhillmanor's avatar
    rockhillmanor
    Explorer
    Jun 05, 2015
    I'll just add what "I" did not take into consideration when making my decisions when I went full time and how it affected me when I decided to pull off the road.

    If you leave your vehicles registered in Illinois you will have to travel back there each time for emissions testing to renew your plates.

    So pick a state that does NOT have emissions testing.

    Pick a state that does not have state income tax if that is an attracting bonus for your financial situation and/or if you are near retirement. Owning a company in your home state might alter what is the best decision for you though.

    If you choose Florida keep in mind there is an impact fee the first time you register your vehicle there count on around $500 per vehicle.

    And yes some of those states will allow a mailing company address BUT when that address goes on your drivers license it can cause additional problems down the road with your insurance and other institutions that do NOT allow mailing address' and require your DL for proof of address. An oxymoron at it's best.

    Do your homework and read read about all the different options before you jump ship! :W

    Here's a few for you to peruse over! :B
    http://taxes.about.com/od/statetaxes/a/Best-States-for-Retirees.htm
    http://taxes.about.com/od/statetaxes/a/tax-free-states.htm
    http://retirementliving.com/RLtaxes.html
  • C-Bears's avatar
    C-Bears
    Explorer
    Jun 05, 2015
    When we sold our home in Illinois and started full timing we kept Illinois as our domicile state. We used our son's address and he forwarded our mail. This method worked okay except for jury duty problems.

    We recently purchased a residence in Florida and plan on living in it about 5 or 6 months every year. Switching over vehicle titles can range from $200 or more depending on weight registered. But you will make that up because the yearly plate renewal is about 1/3 of what Illinois is.

    I really can't add much to what has already been stated otherwise. There is a lot to consider when picking the state.
  • retispcsi's avatar
    retispcsi
    Explorer
    Jun 05, 2015
    I have to add that impact fees are charged when you build structure. ie, home etc. Does not apply to vehicles. If you choose Fl. you receive your mail forwarding address you will need to show proof of that address. What we did was change our address on our vehicle insurance, cell phone bill and bank account. We needed two docs and did three. If you have never applied for a license in Florida you will need a certified birth certificate or passport. Your wife will need a divorce decree if she was married before. ie name change. Easy as eating pie. I came from Ill. originally. Good luck whatever you choose.

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