Author:By FRANk S. BERALL(fn*)

Connecticut Bar Journal

Volume 82.

82 CBJ 249.


Connecticut Bar Journal Volume 82, No. 3, Pg. 249 September 2008


The domicile, residence and citizenship of a client, his(fn1) relatives or other beneficiaries may have a significant impact on taxation of his and their income, assets, gifts and, ultimately, estates. This is also true of people who may have named the client as a beneficiary of their estates or have given or are planning to give him a large gift.

State and local income, gift, death and property taxes may be imposed, either because of the domicile or residence of a person or the situs of his real or tangible personal property.

Even if the client or his relatives are not united States citizens, his or their status as resident or nonresident aliens may affect his or their united States federal income, gift, estate and generation skipping taxes. Furthermore, his or their income, assets, gifts and estates may be subject to taxation by the country of which he or they are citizens, domiciliaries or even just residents.


The determination of domicile is largely a question of fact. Furthermore, since there is no U.S. federal nor state statutory definition of domicile, a court will look to its own state's common law for a definition. Thus, everything known about the concept of domicile is based entirely on case law.

Generally, most common-law jurisdictions consider domicile as a "person's legal home. [It is t]hat place where a man has his true, fixed and permanent home and principal establishment, and to which whenever he is absent he has the intention of returning.... Generally, physical presence within a state and the intention to make it one's home are the requisites of establishing a `domicile' therein... [It is t]he permanent residence of a person or the place to which he intends to return, even though he may actually reside elsewhere."(fn2)

"The domicile of persons often will be critical in resolving jurisdictional matters, particularly as regards settlement of estates. Domicile is the legal situs of a person established by choice or by operation of law. A domicile of choice is the `established, fixed, permanent' and therefore ordinary dwelling place of a person, as distinguished from a temporary and transient place of residence."(fn3) Two factors are essential to constitute domicile of choice: (a) actual residence in a place; (b) coupled with the intention of making that place a home.(fn4)

Residence and domicile are distinguished. "A person may have more than one residence but only one domicile. [The latter,] rather than the actual residence, often controls the jurisdiction... to tax] and determines where a person may... [vote and exercise] other legal rights and privileges."(fn5) Although there are numerous cases discussing the concept of domicile, a person's domicile is a question of fact. Thus, it does not readily lend itself to an all-encompassing definition. "Residence implies something more than mere physical presence and something less than domicile."(fn6)

A person's domicile is also his legal residence, as distinguished from any temporary place of abode. It "is the place which... [he] intends to be his... permanent home and to which... [he] intends to return whenever absent,"(fn7) rather than where business or pleasure may temporarily call him. Generally, it is the place where he "dwells and is the center of his domestic, social and civil life."(fn8)

Although an individual can have only one domicile, more than one state or country may attempt to impose its taxes on him, claiming it is his domicile. A domiciliary of a given jurisdiction is subject to both its death and income taxes, but a person domiciled (and who may also reside) elsewhere may only be subject to income taxes where he resides. Thus, Connecticut, New york, Massachusetts, and some other states tax nondomiciliaries as residents if they spend a specified number of days (usually 183) in that state.(fn9) Furthermore, it appears that a person whose estate will be subject to death taxes at his domicile may not necessarily be a resident of that jurisdiction if he does not maintain a permanent abode there. Thus, it should not tax his income.

Because of the practical necessity of attributing only one situs to a person, the following principles are generally recognized. Every person has a domicile somewhere.(fn10) Therefore, when a person is not capable of exercising a choice of domicile, the law provides one (fn11) A domicile is never lost until a new one is acquired.(fn12) Furthermore, regardless of a person's intentions, he may have only one domicile at a time.(fn13) Every person's earliest domicile, called their domicile of origin, is a domicile by operation of law because a newborn person is not capable of acquiring one of choice. His domicile of origin is that of his father, if he is legitimate, or that of his mother, if illegitimate.(fn14) If the domicile of his father or mother cannot be ascertained, their child's domicile (or at least settlement) will be his place of birth.(fn15)

Any legally capable person may acquire a domicile of choice anywhere, provided he resides there and intends to make it his home.(fn16) To change a domicile of choice, both of these items (physical presence and intent) must be transferred to a new location. until this is done, his domicile remains unchanged.(fn17) A change of domicile thus requires both his act and his intention. where he has a place of abode, his intention with respect to it controls in determining the location of his domicile.(fn18)

"The burden is upon an individual asserting a change of domicile to show that the necessary intention existed."(fn19) Furthermore, "[a]n individual who is a Connecticut domiciliary bears the burden of demonstrating that the conditions... have been met when claiming to be a nonresident during the taxable year."(fn20) No minimum period of residence in a new location is essential to accomplish a change of domicile,(fn21) but actual presence in the new place of abode is essential to establish residence.(fn22) Then, a transfer of domicile requires only an intent to make this new location a home.(fn23)

However, "the amount of proof applicable to a change of domicile case under New york's state income tax law is by clear and convincing evidence."(fn24) Once a new domicile has been acquired it is not lost by a subsequent temporary absence, no matter how long, provided an intent to return exists.(fn25)

To change domicile successfully, not only must a new domicile be established in another jurisdiction, but the old domicile must be abandoned. However, a domicile is never lost until a new one is acquired.(fn26) Death taxes based on a Connecticut domicile will ordinarily be imposed on all the decedent's property, except realty and tangibles situated elsewhere. But real and tangible personal property located outside Connecticut may then be subject to death taxes in that jurisdiction.

Jurisdictions may classify property as real, tangible, or intangible in different ways. In addition they may have another method of determining property subject to tax, its ownership, tax rates, exemptions, exclusions, deductions, credits and who bears the tax burden. To some extent, tax treaties may prevent this from being a major problem between countries, but no such concept applies between states.

As mentioned above,(fn27) a person's domicile of origin, sometimes referred to as his natural domicile or domicile by birth, is where he was born; essentially, the domicile of his parents (or mother, if his father is domiciled elsewhere) at the time of his birth. It continues to be his domicile until a new one is acquired and the old one abandoned. "The essentials of `domicile' of choice are... physical presence at a dwelling place and the intention to make that place home."(fn28)

Besides the question of domicile, a dispute may arise between states as to which law applies. The Connecticut Supreme Court has adopted the "most significant relationship" approach to analyze choice-of-law issues involving contracts.(fn29) The same reasoning could easily be applied in other types of cases, including those involving domicile, where there is a question of applicable law. Thus, in these cases, the court "must determine whether Connecticut has a more significant relationship under the principles stated in § 6 of the Restatement (Second)... to the [controversy over domicile or residence. If so,] Connecticut law would be applied. Section 6(2) sets forth seven considerations in determining which of... two states has the more significant relationship: (a) the needs of the interstate and international systems, (b) the relevant policies of the forum, (c) the relevant policies of the other interested states and the relative interests of those states in the determination of the particular issue, (d) the protection of justified expectations, (e) the basic policies underlying the particular field of law; (f) certainty, predictability and uniformity of result, and (g) ease in the determination and application of the law to be applied.(fn30)

At the death of an emancipated person (someone age 18 or over) from another state, either attending college, graduate school or in the armed forces in Connecticut), there are certain statutory presumptions governing...

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