If a couple moves their domicile from New York to Connecticut partway through the year but their old, furnished New York City apartment doesn't sell and they still spend more than 183 days in New York that year, are they taxed as full-year New York residents?

Plain-English summary

David and Leslee Rogath were domiciled in New York State through the end of 1988. During 1988 they decided to move their business and family to Connecticut, and they closed on a $6,000,000 Connecticut house on July 7, 1989, moving in shortly after with their furnishings and their child. As soon as they had a contract to buy the Connecticut house - even before the closing - they listed their New York City cooperative apartment at 40 Fifth Avenue for sale, and kept trying hard to sell it in the years that followed. It didn't actually sell until August 19, 1993, more than four years later, because the Northeast and New York City cooperative real estate markets were depressed at the time. On their brokers' advice, the apartment stayed fully furnished with the telephone and utilities left on the whole time, to make it easier to show and sell. The Rogaths also moved their business to Connecticut and switched their voter registrations, driver's licenses, and car registrations there.

For purposes of this opinion, the Department assumed (without deciding) that the Rogaths' domicile changed to Connecticut on July 7, 1989. Before that date they spent fewer than 183 days in New York. But between July 7 and December 31, 1989, they still spent roughly five to six nights back at the 40 Fifth Avenue apartment plus other time in the state, adding up to about 80 more New York days in that stretch alone - enough to push their combined 1989 New York day count over 183.

The question was whether the Rogaths were New York "statutory residents" for all of 1989 under Tax Law § 605(b)(1)(B), even though their domicile changed to Connecticut mid-year. The Department said yes, and said it didn't even need to resolve whether or when the domicile change actually happened to reach that answer. Under § 605(b)(1)(B), a person who is not domiciled in New York is still taxed as a resident if they maintain a "permanent place of abode" in New York and spend more than 183 aggregate days there in the year; 20 NYCRR § 105.20(e) defines a permanent place of abode as a dwelling permanently maintained by the taxpayer, whether owned or not. The Department walked through a consistent line of authority - Kritzik v Gallman, Matter of Smith v State Tax Commission, Matter of Kornblum, and Matter of Veeder - all holding that a taxpayer who keeps a New York dwelling available (even while trying to sell it, and even after changing domicile elsewhere) and who crosses 183 New York days in the year is a full-year statutory resident regardless of domicile. Because the Rogaths kept the 40 Fifth Avenue apartment furnished, powered, and available all year while unsuccessfully trying to sell it, and because their aggregate 1989 New York days exceeded 183, they were subject to tax as New York statutory residents for the entire 1989 taxable year under § 605(b)(1) - independent of, and without needing to resolve, exactly when their domicile changed.

What this means for you

Individuals relocating out of New York whose old home hasn't sold yet

Changing your domicile to another state does not, by itself, end your New York tax exposure for the year you move. If your old New York home remains "maintained" - meaning it stays available for use, with utilities and furnishings kept on, even if that's purely to help a broker show and sell it - and you still spend more than 183 aggregate days in New York that year (including short visits back, like a handful of overnight stays), you will be taxed as a full-year New York resident on all your income for that year, no matter how firmly you've established your new domicile elsewhere. A soft real estate market that delays your sale, as happened here for more than four years, can extend this exposure well beyond what you expected when you moved.

Accountants and tax professionals evaluating transition-year residency exposure

When a client changes domicile mid-year, don't stop at the domicile analysis - separately check the statutory residency test under § 605(b)(1)(B). If the client kept a New York dwelling available (even unintentionally, because it hasn't sold) and crossed 183 aggregate New York days for the year counting all time in the state, the client is a full-year statutory resident regardless of the domicile finding. This ruling and its cited precedents (Kritzik, Smith, Kornblum, Veeder) show the Department applies this rule consistently, so it's worth counting all New York days carefully - even brief overnight stays at the old residence - and confirming whether the old home was truly given up (sold, sublet, furnishings removed) rather than merely listed for sale.

Common questions

Q: Since the Rogaths changed their domicile to Connecticut mid-year, why were they still taxed as full-year New York residents?
A: Domicile and statutory residency are two separate tests under Tax Law § 605(b)(1). Even someone who is no longer domiciled in New York can still be a "statutory resident" under § 605(b)(1)(B) if they maintain a permanent place of abode in New York and spend more than 183 aggregate days there during the year. The Rogaths met both of those conditions, so the domicile question didn't need to be resolved.

Q: Their apartment was for sale the whole time - how could it still count as a "permanent place of abode"?
A: Under 20 NYCRR § 105.20(e), a permanent place of abode is simply a dwelling place permanently maintained by the taxpayer, whether or not it is owned. The apartment stayed furnished with telephone service and utilities running throughout 1989, on the advice of the real estate brokers, so it remained available for the Rogaths' use even though they were actively trying to sell it. Listing a home for sale doesn't stop it from being "maintained" until it actually sells or is otherwise given up.

Q: How did the Department count the 183 days when the Rogaths had already moved to Connecticut by July?
A: The 183-day count is an aggregate for the entire taxable year, not just the period before the move. The Rogaths spent under 183 days in New York before July 7, but between July 7 and December 31 they still logged roughly five to six nights back at the 40 Fifth Avenue apartment plus other time in the state, totaling about 80 more days - pushing their full-year total past 183 even though they were living in Connecticut for most of that stretch.

Q: Did the Department decide exactly when the Rogaths' domicile changed to Connecticut?
A: No. It expressly noted that the timing of a domicile change is a factual question that can't be resolved in an Advisory Opinion (citing Tax Law § 171.Twenty-fourth, 20 NYCRR § 2376.1(a), and its own opinion in Kenneth Springer, TSB-A-93(1)I). It simply assumed, for purposes of the analysis, that the change occurred on July 7, 1989 - and found that the outcome was the same either way because the statutory residency test resolved the case on its own.

Q: Is this a one-off result, or does New York apply this rule consistently?
A: The Department cited a consistent line of authority. In Kritzik v Gallman, taxpayers who genuinely gave up their New York home when they moved were not statutory residents. In Matter of Smith v State Tax Commission, taxpayers who changed domicile mid-year but could not sell their New York residence were held to be full-year statutory residents - a very similar fact pattern to the Rogaths'. In Matter of Kornblum, taxpayers claiming a Florida domicile change were statutory residents because they kept a New York abode and failed to prove they were under 183 days. In Matter of Veeder, the Tribunal didn't even need to reach the domicile question because statutory residency was clear on its own. This ruling follows that same consistent approach.

Q: What should someone do differently to avoid this outcome when relocating out of New York?
A: The two levers are the permanent place of abode and the day count. If the old New York home can be sold, sublet, or otherwise fully given up (furnishings removed, utilities disconnected) before year-end, it stops counting as a maintained abode. And limiting total New York days - including short visits back to the old residence - to 183 or fewer for the year avoids the statutory residency test regardless of what happens with the home. Relying on domicile change alone, without addressing both of these, is not enough.

Citations and references

• Tax Law § 605(b)(1)(A) - resident individual domiciled in New York, unless no New York permanent place of abode is maintained, one is maintained elsewhere, and 30 or fewer days are spent in New York
• Tax Law § 605(b)(1)(B) - resident individual not domiciled in New York who maintains a New York permanent place of abode and spends more than 183 aggregate days of the taxable year in New York
• 20 NYCRR § 105.20(e) - a permanent place of abode is a dwelling place permanently maintained by the taxpayer, whether or not owned, generally including one owned or leased by the taxpayer's spouse
• Tax Law § 171.Twenty-fourth and 20 NYCRR § 2376.1(a) - an Advisory Opinion applies statutes and regulations to a specific set of facts and cannot resolve disputed factual questions such as the timing of a domicile change
• Kritzik v Gallman, 41 AD2d 994 (1973) - taxpayers who gave up their New York permanent place of abode when they moved were not statutory residents, implying the opposite result had they kept the abode
• Matter of Smith v State Tax Commission, 68 AD2d 993 (1979) - taxpayers who changed domicile mid-year but could not sell their New York residence were full-year statutory residents because they exceeded 183 New York days and maintained a New York abode
• Matter of Eli and Beatrice Kornblum, Tax Appeals Tribunal, January 16, 1992, TSB-D-92(3)I, affirmed 194 AD2d 882 - taxpayers claiming a Florida domicile change were statutory residents because they maintained a New York abode and did not prove they spent 183 days or fewer in New York
• Matter of Harold M. and Pearl M. Veeder, Tax Appeals Tribunal, January 20, 1994, TSB-D-94(4)I - the domicile question did not need to be resolved because the taxpayers were clearly statutory residents under the abode-plus-183-days test
• Kenneth Springer, TSB-A-93(1)I (February 5, 1993) - the timing of a domicile change is a factual question that cannot be resolved in an Advisory Opinion

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/income_ao_1994.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/income/a94_9i.pdf

Original ruling text

New York State Department of Taxation and Finance

TSB-A-94 (9) I
Income Tax
July 5, 1994

Taxpayer Services Division
Technical Services Bureau
STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. I940311A

On March 11, 1994, a Petition for Advisory Opinion was received from David
and Leslee Rogath, P.O. Box 7917, Greenwich, Connecticut 06836.
The issue raised by Petitioners, David and Leslee Rogath, is whether they
are considered statutory residents for taxable year 1989, under section
605(b)(1)(B) of the Tax Law, if they changed their domicile from New York State
to Connecticut on July 7, 1989.
Petitioners, husband and wife, were domiciled in New York State through
December 31, 1988. During 1988, Petitioners decided to move their business and
their family to Connecticut. Petitioners purchased a $6,000,000 residence in
Connecticut on July 7, 1989 and shortly thereafter they moved into the house with
their furnishings and their child.
Once the taxpayers had entered into a contract to purchase the Connecticut
residence, they listed their residence at 40 Fifth Avenue in New York City for
sale with real estate brokers. Petitioners listed the apartment for sale prior
to the purchase of the Connecticut residence, during the summer of 1989 and in
subsequent years Petitioners aggressively attempted to sell the apartment.
Petitioners sold the 40 Fifth Avenue residence on August 19, 1993. Although the
apartment remained furnished and supplied with telephone service and utilities,
this was at the suggestion of the real estate brokers, who advised Petitioners
that this would facilitate the sale of the apartment.
As a result of the depressed state of the real estate market in the
Northeast and especially the New York City market for cooperative apartments, the
apartment did not sell during the year 1989. Petitioners established their
business in Connecticut and changed their voter registrations, driver's licenses
and car registrations to Connecticut. For the purposes of this opinion it is
presumed that Petitioners changed their domicile to Connecticut on July 7, 1989.
Prior to July 7, 1989, Petitioners spent less than 183 days in New York
State. However, between July 7 and December 31, 1989 Petitioners spent
approximately five to six nights at the 40 Fifth Avenue residence and a total of
approximately 80 days in New York. In the aggregate, the total number of days
Petitioners spent in New York State during 1989 exceeded 183 days.
Section 605(b) of the Tax Law defines a resident and nonresident individual
as follows:
(1) Resident individual. A resident individual means an individual:

TP-9 (9/88)

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TSB-A-94 (9) I
Income Tax
July 5, 1994

(A) who is domiciled in this state, unless (i) he maintains no
permanent place of abode in this state, maintains a permanent place
of abode elsewhere, and spends in the aggregate not more than thirty
days of the taxable year in this state ... or
(B) who is not domiciled in this state but maintains a
permanent place of abode in this state and spends in the aggregate
more than one hundred eighty-three days of the taxable year in this
state ...
(2) Nonresident individual.
A nonresident individual means an
individual who is not a resident or a part-year resident.
Section 105.20(e) of the Personal Income Tax Regulations, defines a
permanent place of abode as a dwelling place permanently maintained by the
taxpayer, whether or not owned by such taxpayer, and will generally include a
dwelling place owned or leased by such taxpayer's spouse.
In the Matter of Kritzik v Gallman, 41 AD2d 994 (1973), the taxpayers moved
from New York to Connecticut on July 27, 1967. The taxpayers tried to establish
that they were statutory residents of New York for the entire year 1967, so that
the distributive share of partnership losses of the husband cold be taken into
account in computing their New York tax liability for the year.
The court
rejected the contention, stating that "[w]hen petitioners moved to Connecticut
in July, they no longer maintained a permanent place of abode in New York. They
could not, therefore, meet the statutory requirements for residents. (Tax Law,
605, subd. [a], par. [2] of the Tax Law.)" This implies that had they maintained
a permanent place of abode for the year in New York and met the other
requirements of the statute, they could have established that they were statutory
residents for the years, despite having changed their domicile during the year.
The Appellate Division addressed this further in the Matter of Smith v
State Tax Comm, 68 AD2d 993, (1979), where it determined that the taxpayers, who
had changed their domicile from New York to Florida during the year, nevertheless
were statutory residents since they spent more than 183 days in New York during
the taxable year and they maintained a permanent place of abode in New York
because they were unable to sell their New York residence during the taxable
year. Therein, the taxpayers moved from New York to Florida in July of 1970.
In September 1970, the taxpayer sold a large amount of corporate stock.
Initially, the stock was taxed on the ground that there was no change of domicile
in 1970 and, therefore, the taxpayers were New York residents for the entire
year. After a formal hearing, the State Tax Commission held, on June 24, 1977
that although a change in domicile did occur in July, 1970, the taxpayer were
taxable as residents for the entire year under section 605(a)(2) of the Tax Law
since they maintained a permanent place of abode in New York for the entire year
and spent more than 183 days in New York State. The Appellate Division confirmed
the assessment, rejecting the taxpayers' argument that they only had notice as
to the change of domicile issue and not the issue of whether they were residents
under section 605(a)(2) of the Tax Law. The court stated:

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TSB-A-94 (9) I
Income Tax
July 5, 1994

Furthermore, a fair reading of section 605 (subd [a], par [1])
reveals that if the taxpayer could not establish domicile in Florida
they would at least in part have to establish that they did not
maintain a "permanent place of abode" in New York and did not spend
more that 30 days of the taxable year here. On the other hand, if
domicile was not in issue, then they would have had to show that no
permanent place of abode was maintained in this State and no more
than 183 days of the taxable year were spent here (Tax Law,
605,
subd [a], par [2]).
In the Matter of Eli and Beatrice Kornblum, Dec Tax App Trib, January 16,
1992, TSB-D-92-(3)I, the Tribunal affirmed the administrative law judge's
determination that the petitioners were statutory residents even if a change of
domicile was established. Therein, the petitioners sought to prove that they
changed their domicile from New York to Florida in October 1983.
The
administrative law judge determined that the taxpayers had not established a
change in domicile, but that even if they did change domicile, they maintained
a permanent place of abode in New York State and did not prove that they did not
spend at least 183 days of the year in New York for the tax years at issue.
Hence, they were properly assessed under section 605(a)(2) of the Tax Law as
statutory residents. The Appellate Division in Kornblum v. Tax Appeals Tribunal
194 AD2d 882 affirmed the Tribunal decision stating that the taxpayers continued
to be domiciliaries of New York State for the tax years at issue.
In the Matter of Harold M. and Pearl M. Veeder, Dec Tax App Trib, January
20, 1994, TSB-D-94-(4)I, the Tribunal affirmed the administrative law judge's
determination that it was unnecessary to resolve the question of the petitioner's
domicile because it is clear that, regardless of their domicile, they were
statutory residents of New York State because it was established that petitioners
maintained a permanent place of abode within New York State during the years in
issue and they did not sustain their burden of showing that they did not spend
more than 183 days of the taxable year in New York State.
The determination of whether a change of domicile has occurred, is a
question of fact which depends on a variety of individualized circumstances
(Matter of Newcomb, 192 NY 238, 250; Kenneth Springer, Adv 0p Comm T & F,
February 5, 1993, TSB-A-93(1)I. Questions of fact are not susceptible of
determination in an Advisory Opinion. An Advisory Opinion merely sets forth the
applicability of pertinent statutory and regulatory provisions to "a specific set
of facts"
Tax Law, 171.Twenty-fourth; 20 NYCRR 2376.1(a). Therefore, herein,
a determination cannot be made in an Advisory Opinion as to when and/or whether
Petitioners changed their domicile from New York to Connecticut during 1989.
However, it is unnecessary to resolve the question of Petitioners' domicile
because regardless of their domicile, they maintained a permanent place of abode
in New York State for the entire taxable year 1989, and they spent in the
aggregate more than 183 days of the taxable year 1989 in New York State.

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TSB-A-94 (9) I
Income Tax
July 5, 1994

Accordingly, regardless of Petitioners' domicile, for taxable year 1989,
Petitioners are subject to tax as statutory residents of New York State pursuant
to section 605(b)(1) of the Tax Law. Kritzik, supra.; Matter of Smith, supra.;
Matter of Kornblum, supra.; and Matter of Veeder, supra.

DATED: July 5, 1994

s/PAUL B. COBURN
Deputy Director
Taxpayer Services Division

NOTE: The opinions expressed in Advisory Opinions
are limited to the facts set forth therein.