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Need opinions on my domicile options


RMD3819

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Current situation:

 

Wife and I live in FL, have for decades. Prepping house for sale and when sold will purchase RV for cash (~250K) and go FT, hopefully in a few months. We own no other house or land anywhere. When we are done with FT it is unlikely we will return to FL. Health insurance is covered.

 

We have a CRV which we will use for toad and wife has a VW Beetle we will store at a friend's in FL. They will start/drive it occasionally. (Wife will not part with the car-don't even ask). Wife will not consider Texas for domicile.

 

SD option:

Sales tax (4%) on $250K is $10K. Registration based on weight which means ~450/year just for the RV/~$90/year per car.

 

FL option:

Sales tax (6%) on $250K is $15000. Registrations are reasonable yearly. Plus we have been here for a long time and have DLs. As with any option we would use a mail forwarding service. I think insurance is high here but really can't compare since I have been here since 1981.

 

MT option:

Put the RV and CRV in a LLC. ~$1300 start up the ~$65 year thereafter. No sales tax. Renewals ~$500/year for two vehicles. Domicile in FL or SD depending on insurance costs.

 

VW Beetle staying in FL:

Will drop insurance to the minimum and keep FL registration and FL insurance. I don't see the wisdom in transferring the title and registration to a vehicle barely driven though open to ideas.

 

The wild card in all this is insurance costs, especially on the RV. I realize this is based on lots of individual factors but is there any general wisdom on the best rates between these three options for someone in my situation?

 

Please correct any assumptions and share your thoughts.

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Health insurance should factor into your decision. Plans vary in price and options depending on where you domicile. That's something we are having to look at now, for when we go officially full time in the very near future.

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Health insurance should factor into your decision. Plans vary in price and options depending on where you domicile. That's something we are having to look at now, for when we go officially full time in the very near future.

He did say heath insurance is covered. With that caveat, I would call and insurance agency and have them run some numbers for you "apples to apples" with a specific (albeit fictional) rig, varying the state.

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since health insur is not a factor for you, its really a toss up, take your pick. a few hundred dollars in vehicle insur costs shouldn't make a difference. But in general SD is one of the lowest for vehicle insur and Fl is in the highest group for vehicle insur. But there are so many factors used in insur rates, its hard to compare ours to yours. With your long term record in Fl, if its a good record, you may not see much savings in SD. You can expect the LLC insur to be high and not all carriers will cover an LLC (business) vehicle. Remember that in any case you're looking for a "fulltimers" policy, not just vehicle insur. So the price will be higher, since its a hybrid of vehicle & homeowners coverages.

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During our 16 years of full-timing we used Miller Insurance to find us the best price. We had them check every 2-3 years for new rates as once you get with an insurance company they'll gradually raise rates. We got our full-time insurance through Progressive and National Interstate. GMAC was once in the mix early on. Miller will find you the best rates regardless of where you domicile - TX, SD and even Montana LLCs. Check them out.

 

http://www.millerrvinsurance.com/

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  • 2 weeks later...

When we made the decision to go full-time we were still living and working in Missouri. Florida was quite a ways away, while Texas and South Dakota were about the same distance from us. We decided to go with one of those two. SD seemed to be a better fit for us. Health insurance wasn't an issue since we are covered by MediCare. Supplemental insurance varies by State, so that may be a factor.

 

The difference in sales tax from FL to SD would seem to be to be more of a factor than what the liability insurance costs are. You will have to travel to SD to get your driver's licenses, but you can license your vehicles via mail because there is no vehicle inspection required. There is another current thread about getting a SD license.

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The MT LLC option was one that we considered. We opted to keep our TX status. I do own land in TX, a small cattle ranch, and

I also own land in the UP of MI. Being Medicare age health insurance was not really considered. I have made this statement on this forum before

and have received negative feedback. We didn't like the idea of setting up a company in MT just to not pay sales tax. To each his own, but it doesn't feel right

to us. Good Luck

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We just went fulltime, yet we will still be working until DEC 2017. Like RMD said, we have health insurance covered (we are US Government employees). Like 2gypsies said, Miller is a good insurance agency and we were told by our agent that domiciling in SD will cut our premium almost in half. We were also told by our Coach-Net agent that they could not provide coverage if we domiciled in FL (Miller said our rates would go up).

 

So, on our way to Alaska in 2018 we will be spending time in SD getting a new DR/Dentist/DL and setting up mail forwarding at the Escapees SD center IOT establish SD as our new domicile.

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  • 3 weeks later...

 

 

Yes. I am eligible for my prior employer's health plan.

When we changed our residence to South Dakota, I was still using my ex-employers insurance plan, on my nickle. Going from Maryland to South Dakota lowered my annual cost almost $300.

 

So staying on you ex-employers insurance can be different depending on what state you pick. Insurance premiums are by state.

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When we changed our residence to South Dakota, I was still using my ex-employers insurance plan, on my nickle. Going from Maryland to South Dakota lowered my annual cost almost $300.

 

So staying on you ex-employers insurance can be different depending on what state you pick. Insurance premiums are by state.

 

Fortunately they are self insured so my premiums are unchanged no matter where I live. They hire a claims administrator for the paperwork and use the Cigna network for out of the local area.

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Fortunately they are self insured so my premiums are unchanged no matter where I live. They hire a claims administrator for the paperwork and use the Cigna network for out of the local area.

 

We had insurance similar to that until we reached aged 65. Then it stopped and Medicare started. But, it was wonderful while it lasted.

 

Linda Sand

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  • 2 months later...

Update-

 

House is for sale but isn't selling.... :(

 

Trying to choose between the SD mail forwarders as we are on the road and will need a mail solution before a domicile solution.

 

I have to maintain my Florida residency as I don't want to lose the Homestead tax exemption on my property.

 

So..three questions:

 

1. Am I correct in that mail forwarding only would not affect residency?

 

2. Car registration renewal due in January. If the house has not sold I don't want to renew FL-i would like to register in SD. Do you think that will affect residency? I am not sure how they would know.

 

3. Any recommendations on which SD forwarder to use (or not use)? They are all about the same price for the level of service we would use.

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You say health insurance is covered. So you're saying regardless of your domicile, you have the same coverage at the same price???

 

That is entirely possible under some circumstances. The two that immediately come to mind are retired military or retired U.S. civil service.

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Update-

 

House is for sale but isn't selling.... :(

 

Trying to choose between the SD mail forwarders as we are on the road and will need a mail solution before a domicile solution.

 

I have to maintain my Florida residency as I don't want to lose the Homestead tax exemption on my property.

 

So..three questions:

 

1. Am I correct in that mail forwarding only would not affect residency?

 

2. Car registration renewal due in January. If the house has not sold I don't want to renew FL-i would like to register in SD. Do you think that will affect residency? I am not sure how they would know.

 

3. Any recommendations on which SD forwarder to use (or not use)? They are all about the same price for the level of service we would use.

 

If I was just starting out and wanted to use SD I would use the one that has a campground near Rapid City as you "could" live there so address might be less of an issue. But, that is only opinion based on no research whatsoever. :)

 

You are supposed to register a vehicle where it is primarily garaged. How much time do you plan to spend in SD vs FL?

 

Linda Sand

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So, you want to keep your Fl residency active until the house sells, that's understandable and shouldn't be an issue.

Just using a mail forwarding service in a new state does not change your domicile by itself.
Having vehicles registered in different states does not by itself effect your domicile. Many folks who have seasonal 2nd homes have multiple vehicles registered in different states.
South Dakota has at least 3 very good mail forwarding companies. They all have very high reputations & recommendations from their clients. I chose Americas Mailbox in Box Elder (Rapid City) more for its location, at the time I owned property in that end of the state. But 10 years later I'm still with them and very happy with their performance.

 

 

Update-

 

House is for sale but isn't selling.... :(

 

Trying to choose between the SD mail forwarders as we are on the road and will need a mail solution before a domicile solution.

 

I have to maintain my Florida residency as I don't want to lose the Homestead tax exemption on my property.

 

So..three questions:

 

1. Am I correct in that mail forwarding only would not affect residency?

 

2. Car registration renewal due in January. If the house has not sold I don't want to renew FL-i would like to register in SD. Do you think that will affect residency? I am not sure how they would know.

 

3. Any recommendations on which SD forwarder to use (or not use)? They are all about the same price for the level of service we would use.

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I have to maintain my Florida residency as I don't want to lose the Homestead tax exemption on my property.

I'm wondering why you want to change to SD for mail service? Since FL is one of the "favored three" states, why not just get mail service for where you are now? Escapees have mail service to use any of the three states, so you could even get mail through them now and very easily change your domicile to TX or SD at a later date with minimal need for changes.

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I realize Florida is one of the three favored states but chose SD for the (presumably) lower insurance costs. We don't have the FT coach yet so I can't comparison shop.

 

When FT is over we will not be returning to Florida. Don't know where we will end up.

 

The plan is to change everything to the SD address now and when we leave FT change one last time to where we end up. I don't really want to change to a different FL address only to switch again to SD when we go FT.

 

I just looked up FL Homestead requirements and it says nothing about mail service. It does require a FL DL (or ID card) AND at least one vehicle registered in FL although I don't know how/if they check. I was going to keep the DL anyway since we won't make it to SD until spring or summer but it looks like I will have to keep one (of three) vehicles with FL registration.

 

We are going to go with America's Mailbox as they have a plan that suits us.

 

Thanks for the responses.

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We owned property in MI and used a mail forwarding service from FL for 3 years. Then sold the house and changed to Your Best Address in Sioux Falls SD. We registered our vehicles and then when we visited the state a month later, we established our residency by spending a few nights, getting our drivers licenses, insuring our motorhome , vehicle and motorcycles. If you are not going to tour the state, you may want to select one that is closest to you. They all have good reputations and are recommended by their customers. Our service recommended Daugherty Ins also in Sioux Falls. We provided ahead of time, full-timer quotes from 4 different companies. We then started the insurance we had chosen at their office while we were there. Michigan insurance is a little unique, and expensive,and we found the SD rates to be about 1/2 of what the MI rates had been. We had previously gotten quotes in FL and they were almost as high as MI. We are very happy with our mail service and would not hesitate to recommend them.

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Once you've been fulltiming and traveling for a few years the possibilities for your final domicile may be surprising. We decided that Colorado suited us perfectly in some areas, and not so much in others. Alaska in summer early fall before frost is ideal but the lack of sun in winter made it a no go. San Diego on the ocean and most of that Pacific coast is ideal for us but too expensive and when you move inland just ten miles the heat in summer can be pretty bad. We will be moving to the Denver area in the next few years and then consider our options form there.

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Sometimes the things that make a difference are not things you would not normally consider. Legal assisted suicide? Medical marijuana? Common law marriage? Inheritance laws? We get so focused on income tax, vehicle tax, and medical insurance that we can overlook things that might be important in any particular case. Please, consider what is important to YOU when considering domicile.

 

Linda Sand

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Linda,

Good post! I never even thought about physician assisted suicide. https://en.wikipedia.org/wiki/Assisted_suicide_in_the_United_States#Colorado

 

After the election, marijuana could be legal for recreational or medical use in 29 states: http://www.latimes.com/politics/la-na-pol-marijuana-initiatives-snap-story.html

 

Let's not forget states that do not tax anything, and states that do not tax retirement checks and military retirement checks:

https://www.rapidtax.com/blog/states-that-dont-tax-military-retirement-pay/#.WBacrmwzUuU

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