Use your browser's "back" button to return to the text.Matter of SILVERMAN TSB-D-89(14)I STATE OF NEW YORK - TAX APPEALS TRIBUNAL June 8, 1989
Opinion - The Administrative Law Judge determined that, according to the record, petitioners failed to establish a change in domicile from New York to Florida during the years at issue. In concluding that petitioners were residents of New York, pursuant to section 605(a)(1)(A) of the Tax Law, during each of the years 1978 through 1982, inclusive, the Administrative Law Judge denied their petition and sustained the notices of deficiency that were issued against them on April 8, 1985.
On exception, petitioners contend that the Administrative Law Judge did not include all facts favorable to the petitioners in the determination, and that they established by clear and convincing evidence their intention to make Florida their permanent home.
We affirm the determination of the Administrative Law Judge.
First we must examine petitioners' exceptions to the findings of fact by the Administrative Law Judge. Petitioners claim:
1. that subsequent to the sale of Modern Maid, petitioner Jack Silverman was provided with a "minimum" office and such office was not extensively used by petitioner,
2. that it was clear from the record that good faith attempts [*15] were made to sell the Woodmere real estate, and that it was consistently on the market,
3. that there was no evidence in the record to indicate that statements from the Woodmere Country Club were sent to petitioners' address in New York, or that the club was used on numerous occasions by petitioner Jack Silverman during the months of May through December at each year in issue,
4. that checking account activities on the part of petitioner Jack Silverman with New York entities does not establish that the payors were in New York,
5. that petitioner Jack Silverman was not actively engaged as a partner in several partnerships reported on his Federal income tax return, but rather that the losses generated by certain partnership investments indicated that they were passive investments,
6. and that in general, petitioners object to the Administrative Law Judge's rejection of the Requested Findings of Fact of Petitioner on the basis that they were unsubstantiated or conclusory in nature.
After extensive review of the record, we find no support for the claim that the Administrative Law Judge misconstrued or otherwise misinterpreted the facts concerning petitioner's office following [*16] the sale of Modern Maid, or the payment of New York expenditures throughout each year.
We also find ample evidence in the record to support the Administrative Law Judge's finding that statements from the Woodmere Country Club were sent to petitioners' address in New York, and that the club in question was used numerous times during the months of May through November of each year at issue. We reviewed each of the collected invoices, and found the actual Woodmere address on those dated May through December. Also included on these monthly statements is an itemized list of the activities engaged in at the club, which supports the factual finding that these facilities were used on numerous days during the months of May through November of each year at issue.
In regard to petitioner Jack Silverman's activities as a business partner in Landoil '79 Associates, the Exeter Company and Fairfax Company during the years at issue, the Administrative Law Judge found as a fact that Jack Silverman was a partner and correctly concluded that petitioner maintained business ties in the State of New York. The Administrative Law Judge did not describe the level of Jack Silverman's activity but simply [*17] concluded that petitioners' Federal tax returns clearly showed a continued business relationship with businesses in the State of New York throughout the period at issue.
We find each of petitioners' above enumerated exceptions to be without merit, in that the facts as stated by the Administrative Law Judge correspond with the documentary and testimonial evidence of record. The exception dealing with the sale of the Woodmere home will be subsequently explored in depth, as this finding of fact relates directly to whether petitioners intended to establish themselves as domiciliaries of Florida.
With regard to the issue of domicile, the Division's regulations (20 NYCRR 102.2[d]) provide, in pertinent part, as follows:
"Domicile. (1) Domicile, in general, is the place which an individual intends to be his permanent home -- the place to which he intends to return whenever he may be absent.
"(2) A domicile once established continues until the person in question moves to a new location with the bona fide intention of making his fixed and permanent home there. No change of domicile results from a removal to a new location if the intention is to remain there only for a limited time; [*18] this rule applies even though the individual may have sold or disposed of his former home. The burden is upon any person asserting a change of domicile to show that the necessary intention existed. In determining an individual's intention in this regard, his declarations will be given due weight, but they will not be conclusive if they are contradicted by his conduct. The fact that a person registers and votes in one place is important but not necessarily conclusive, especially if the facts indicate that he did this merely to escape taxation in some other place.
"(4) A person can have only one domicile. If he has two or more homes, his domicile is the one which he regards and uses as his permanent home. In determining his intentions in this matter, the length of time customarily spent at each location is important but not necessarily conclusive. As pointed out in subdivision (a) of this section, a person who maintains a permanent place of abode in New York State and spends more that 183 days of the taxable year in New York State is taxable as a resident even though he may be domiciled elsewhere."
To effect a change of domicile, there must be an actual change in residence, as [*19] well as an intention to abandon the former domicile and to acquire another (Aetna National Bank v. Kramer, 142 AD2d 444, 445). The absolute and fixed intention to abandon one domicile and acquire another must, however, be established by clear and convincing evidence (see, Matter of Bodfish v. Gallman, 50 AD2d 457). According to Tax Law section 689(e), the burden of proof is upon petitioners to show that the necessary intention to effect a change in domicile existed. In the present case, petitioners did not establish by clear and convincing evidence that they intended to change their domicile from New York to Florida.
The record reveals that in 1961, petitioners purchased a home in Woodmere, New York. Some thirteen years later, in 1974, petitioners began leasing an apartment in Palm Beach, Florida. The record also indicates that petitioners placed their New York home on the market in May, 1975, and in 1983, it was finally sold. The Administrative Law Judge properly determined that the record is not clear with respect to the period of time for which the New York house was offered for sale, for there exists conflicting testimony as to specifically when the house was actually [*20] on the market and when the house was specifically being shown. While it is clear that efforts were made to sell the Woodmere home, it is not clear what degree of effort was made.
The degree of effort made to sell the home is an important factor in determining whether petitioners remained domiciled in, and were resident individuals of the State of New York, because it concerns the issue of intention. Intention as it applies to domicile has long since been recognized by the Court of Appeals as an integral component in making such a determination, when it stated in Matter of Newcomb (192 NY 238, 250):
"Residence means living in a particular locality, but domicile means living in that locality with intent to make it a fixed and permanent home. Residence simply requires bodily presence as an inhabitant in a given place, while domicile requires bodily presence in that place and also an intention to make it one's domicile.
"The existing domicile, whether of origin or selection, continues until a new one is acquired and the burden of proof rests upon the party who alleges a change . . . In order to acquire a new domicile there must be a union of residence and intention. Residence [*21] without intention, or intention without residence is of no avail . . . There must be a present, definite and honest purpose to give up the old and take up the new place as the domicile of the person whose status is under consideration . . . .
"This discussion shows what an important and essential bearing intention has upon domicile. It is always a distinct and material fact to be established. Intention may be proved by acts and by declarations connected with acts, but it is not thus limited when it relates to mental attitude or to a subject governed by choice . . . ."
The uncertainty that surrounds the efforts to sell the New York residence clearly undermines petitioners' claim that they acquired a new domicile and abandoned the old.
Petitioners' retention of their home in New York during the years at issue is but one of the elements to be considered in this process, however. In addition to the failure to dispose of the home in Woodmere, petitioners were engaged in various other affiliations within the State of New York throughout this period. The record indicates that petitioner Jack Silverman maintained his membership in the Woodmere Club during the years at issue, and upon [*22] his return to New York during the months of May through November, used the club's facilities as well. In 1981, petitioner maintained an automobile in New York. Throughout the period at issue, he maintained a safe deposit box in New York as well. It is also important to note that on July 15, 1981, petitioners each executed a Last Will and Testament which included an authorization for New York probate. In addition, petitioners continued their membership in a New York religious temple, engaged in substantially more checking account activity in New York than in Florida, and maintained their subscription to their local New York newspaper.
The test of intent with respect to a purported new domicile has been stated as "whether the place of habitation is the permanent home of a person with the range of sentiment, feeling and permanent association with it" (Matter of Bodfish v. Gallman, supra). While petitioners may have moved to florida in order to establish a residence, they have not provided clear and convincing evidence of an intent to change their domicile such as would warrant a reversal of the Administrative Law Judge. (see, Matter of Zinn v. Tully, 54 NY 713, revg [*23] 77 AD2d 725).
Although petitioners filed a Florida Declaration of Domicile on January 24, 1979, declaring that they had become bona fide residents of Florida on November 29, 1977, as well as registered to vote in Florida and obtained Florida drivers' licenses, courts have recognized the "self-serving nature" of these formal declarations when used as evidence to affirmatively establish new domicile (Wilke v. Wilke, 73 AD2d 915, 917). These formal declarations are less persuasive than the informal acts of an individual's "general habit of life" (Matter of Trowbridge, 266 NY 283, 289). However, regardless of the weight of these factors, in light of the extent and number of affiliations petitioners maintained with the State of New York, they have not sustained their burden of proving their intent to establish Florida as their new domicile during the years at issue.
For these reasons, we affirm the Administrative Law Judge's determination.
Accordingly, it is ORDERED, ADJUDGED AND DECREED that:
1. The exception of the petitioners, Jack Silverman (Deceased) and Frances Silverman (Deceased) is denied;
2. The determination of the Administrative Law Judge is affirmed;
3. [*24] The petition of Jack Silverman (Deceased) and Frances Silverman (Deceased) is in all respects denied; and
4. The notices of deficiency issued on April 8, 1985 are sustained.
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