Establishing residency for income and estate tax purpose (Scottsdale: renting, attorney)

[gumster]

Retired couple thinking of purchasing a place in Arizona while maintaining a second residence in Oregon (for Fall, winter and Spring in Arizona, and return to Oregon to flee the hot Arizona summers). We'd prefer to pay Arizona's lower state income tax rate (rather than Oregon's) and, upon our demise, have our sons avoid being saddled with Oregon's punitive estate/inheritance tax. I'd appreciate suggestions as to what is required to transfer residency out of Oregon and into Arizona to effect such a change.

Yes, I am tired of living in Portland

[wit-nit]

These 2 websites should answer your questions.

Becoming an AZ resident...
https://movingist.com/how-to-become-...idency%20forms.

PROCEDURE FOR DETERMINING RESIDENCY STATUS...
https://azdor.gov/sites/default/file...92_itp92-1.pdf

[gumster]

Wit-nit, I thank you. Reading the sites that you referred to cleared up in my mind the difference legally between Domicile and Residence concepts. Thus, it appears that after establishing our Domicile in Arizona (perhaps Scottsdale), we will be able to reside elsewhere to escape the excessively hot summer months without too much concern about taxation location issues.

mark

[jdhpa]

It's Oregon's tax laws that you need to worry about, e.g.:

https://www.osbplf.org/assets/in_bri...%20InBrief.pdf

I recommend talking to a tax attorney (in Oregon) to make sure you (and your heirs) don't get an unpleasant surprise. Especially if you have property in more than one state, how each is going to tax you can be surprising.

Good luck.

[adjusterjack]

Agree with jdhpa.

Inheritance tax may be based on where the property is, not where your official residence is.

[corydon]

No taxes.... so you want a free ride?

[gemstone1]

Originally Posted by corydon

No taxes.... so you want a free ride?

.
I saw no mention of no taxes by the OP, and none by anyone else....until your post....you read something I missed ?

Tens of thousands of people do what the OP outlined every year in this country, and do it legally.

[gumster]

Originally Posted by jdhpa

It's Oregon's tax laws that you need to worry about, e.g.:

https://www.osbplf.org/assets/in_bri...%20InBrief.pdf

I recommend talking to a tax attorney (in Oregon) to make sure you (and your heirs) don't get an unpleasant surprise. Especially if you have property in more than one state, how each is going to tax you can be surprising.

Good luck.

This is exceedingly helpful. Upon reading this summary, I think that domiciling in Arizona while maintaining a small residence in Oregon will still significantly as the larger portion of our assets would be in our trust-held investment portfolio and our Arizona property; hopefully, the trust portfolio would be viewed as being "domiciled" in Arizona. Consultation with an Oregon tax attorney would, of course, be pursued.

Renting rather than purchasing our Oregon residence might further reduce Estate liability (I hope).

Again, I am surprised to learn of this issue but am exceedingly grateful that you pointed it out.

[gumster]

Originally Posted by corydon

No taxes.... so you want a free ride?

No, and I do not expect one. It is just that considering that I've already paid federal and state taxes on my assets (US and California) as I earned them while working, I dislike the idea of having my heirs taxed again on those same assets.

I never "free ride"!

[gumster]

Originally Posted by gemstone1

.
I saw no mention of no taxes by the OP, and none by anyone else....until your post....you read something I missed ?

Tens of thousands of people do what the OP outlined every year in this country, and do it legally.

Thank you!