Leaving New York City: income tax and residency

Moving from New York City to the Hamptons keeps you a New York State resident for income tax. Whether it also ends New York City resident tax depends on facts the state weighs one by one: where your permanent home is, which homes you keep, and how many days you spend in each. This page restates the Tax Department’s own definitions so you know which questions to ask. It is general information, not tax advice. Talk to a CPA before you rely on any of it, and compare the move’s other costs in Is living in the Hamptons cheaper than NYC?.

Domicile: the place you intend as home

The state defines domicile as the place you intend to have as your permanent home and intend to return to after being away. You can have only one. According to the Tax Department, your New York domicile does not change until you can demonstrate that you abandoned it and established a new domicile outside New York State.

That rule matters to a city-to-East-End move in one way. A Hamptons address is inside the state, so the move does not change your state domicile. Your city status is a separate question that the state decides by facts and circumstances.

A change of domicile must be clear and convincing

The IT-201 instructions say a change of domicile must be “clear and convincing.” Easily controlled factors, such as where you vote, where your driver’s license and registration are issued, or where your will is located, are not primary factors. The state compares:

• the size, value and nature of use of your first residence against the new one
• your employment or business connections in both places
• the time you spend in each
• where items of significant sentimental value are kept
• your close family ties in each place

A change of domicile is clear and convincing only when your primary ties are clearly greater in the new location. Updating a license is still worth doing, and the address, license and voter registration page covers it, but it does not settle the tax question.

Permanent place of abode and the 184-day test

A permanent place of abode is a residence suitable for year-round use that you permanently maintain, whether you own it or not. Under the state’s definition, you are a resident for income tax purposes if you maintain a permanent place of abode in the state for substantially all of the year and spend 184 days or more in the state. Any part of a day is a day.

Tax Bulletin IT-690 says this same test applies when working out whether you maintain a permanent place of abode inside or outside New York City. It also says you generally maintain one for substantially all of the tax year if you maintain it for more than eleven months. Its example of a lake house rented out for six months, so the owner could not use it, is one case where that threshold was not met.

If you keep the city apartment

On Form IT-201, anyone who is not a full-year city resident must say whether they or their spouse maintained or had use of living quarters in New York City during the year. That means a house, apartment, co-op or other dwelling suitable for year-round use that you maintain or pay for. If you answer yes and spent 184 days or more in the city, the instructions say you may be considered a city resident for income tax. “Any part of a day is a day,” and the determination rests on the facts of your situation.

For part of a year as a city resident, the instructions point to Form IT-360.1, Change of City Resident Status.

What to keep

Tax Bulletin IT-690 advises keeping records of the time you spend inside and outside the state if you are domiciled in New York and maintain a permanent place of abode elsewhere, or are domiciled in another state and maintain one in New York.

Before you sign a Hamptons lease

A winter rental that runs only part of the year and a year-round lease can land differently on the eleven-month and year-round-suitability tests above. Which one fits your facts is a question for a tax professional. If you want a low-commitment first step, read Try a winter before you commit. The full sequence of tasks sits in the move checklist.