When Moving Away from California, Beware the Tax Hazards

Want to go on paying high California State Income Tax after moving to a new lower-tax state?  No? Well, if California’s “residency auditors” decide you haven’t completely moved away, you’ll get stuck paying those high California income taxes anyhow. Therefore, you’ll want to prove you’ve truly moved.

Obtaining a fixed home and registering to vote in your new state are good starts, but auditors will be checking many other details, too. Are you still visiting a doctor in California? (They’ll question that.) Are you storing valuable possessions in California? (Not advisable.) You get the idea. 

Special hazard: Are you are planning to test each state by living in it for a while? To establish residency, 183 days is enough in many states. But let’s suppose you’ve moved on to your second “candidate” state before the California residency auditors get around to contacting you.  Your argument that you did establish residency in that first state (which you’ve since abandoned) will be weaker.  So before starting this, seek the advice of a CPA who is well-versed in California residency audits.  

For the full story, read Liz Weston’s article in the L.A. Times: