Hi, I am considering to try purchase a house in Miami for my family (spouse and 2 kids and I). I am wondering if there are any implications on estate tax (federal and state) you can share regarding the impact of either me and/or my wife owning the house in Florida? We have been filing married filing jointly income tax returns. I own two rental apartments in nyc in NY, a small commercial office nyc, and our apartment in NJ. Would there be any impacts on my potential estate tax in the future if my spouse owns a share or 100% of the house in Miami? Or if I owned let's say 49% or 51% of the house in FL, and my wife owned the other 51% or 49%, then would my permanent state of residence still be FL, that could favorably affect my estate tax in NY and NJ related to my apartments in NY and NJ?
I imagine that the total worth of your real estate holdings is considerable and that you might have other investments as well. You are also involved with 3 different states. I encourage you to seek advice from financial planners in your area who deal with high net worth individuals with interests in multiple states.
I want to talk about domicile. Your domicile is your one and only permanent residence. You can only have one domicile at a time. Your domicile is where you have the intention to live permanently, and doesn't have much relation to vacation homes, or other properties you might own. If your main residence is in New Jersey, that is your state of domicile.
There is no single factor that determines where your domicile is located, but some important factors include where you physically live, the location of friends and significant social relationships, the location of your doctor, dentist, attorney, and so on, the location of your church, your voter and car registration, drivers license, and your intention to return. In addition, to establish a new domicile, you must take active steps to abandon your prior domicile.
It is possible to be temporarily away from your domicile for a long time, even years, without changing your domicile.
Buying a second home in Florida does not change your domicile unless you take intentional steps to make it so, such as by moving to Florida, living there most of the time, changing your car and voter registration, getting new doctors, and so on. Even if it is your clear intention to make Florida your permanent main home, New Jersey will likely consider you a resident if you live in New Jersey more than half the year (183 or more days).
If your domicile is in New Jersey, you are New Jersey resident and report all your worldwide income and pay New Jersey tax. If you die while you are domiciled in New Jersey, your estate will be governed by the laws of New Jersey, even if you own property elsewhere.
If you are interested in estate planning, there are specialists who will help you with that.
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