Q: How can snowbirding help me save on taxes?
A: Dear Retiree:
Snowbirding is a great way for retirees to escape the winter weather and can help mitigate high state income taxes at the same time.
Income tax laws vary from state to state. California income tax can be as high as 13.3%, while many states have no income tax at all. You can avoid high income taxes in your home state by establishing residency in a state with low or no income tax, like Florida or Texas.
Typically, you can do this if you reside more than 183 days a year in that state. But some states consider many other factors when determining residency for tax purposes, such as where your vehicles are registered and where your bank accounts are kept. Where you earn income can also affect the state’s tax determination.
If you want to ensure you’re snowbirding strategically, start by sitting down with a Personal Family Lawyer®. Your Personal Family Lawyer® can walk you step by step through creating an asset and estate plan that will protect your wishes and your financials.