Like a long line of other wealthy New Yorkers, President
Donald Trump has decided to establish his legal residence in Florida, apparently at least in part to save money on taxes.But changing one's legal home is not so simple.New York state has a platoon of state auditors who zealously examine whether people are trying to skirt paying its state and local taxes by improperly claiming that they live elsewhere.Those officials regularly face off against an industry of accountants and lawyers who specialize in tax avoidance strategies.Under state law, taxpayers who spend 184 days a year in
New York -- more than half the year -- have to pay state taxes on all of their income. But even if a person does spend most of the year out of state, that is not enough.Tax experts said that convincing auditors that a taxpayer has gone from being a New Yorker to being a Floridian involves more than filing a "declaration of domicile" form, as Trump and
Melania Trump, the
first lady, did in Palm Beach County Circuit Court in September.Florida is one of the few states with no state or local income taxes and has long been a preferred destination for wealthy New Yorkers looking to lower their tax bills.For its part, New York has a multipart test that takes in everything from where a taxpayer's family is and where he or she keeps "items near and dear," like family heirlooms. Auditors also examine whether a taxpayer continues to maintain a business in New York.In this case, if Trump still controlled the Trump Organization, with its considerable holdings in
New York City, that might raise questions.In other words, tax officials look at more than whether a taxpayer has simply switched from a New York bank to a
Florida bank.It is not clear how much time Trump plans to spend in New York during the rest of his presidency or after he leaves the
White House -- or whether he plans to keep his triplex apartment in
Trump Tower or sell it, a move that could figure in how New York evaluates his tax status.And the burden of proof would be on him."Unlike the current impeachment hearings, where the burden of proof is on the House of Representatives, here the burden of proof is on the president to prove that he is no longer a New York resident," said Michael Kosnitzky, who chairs the private wealth group at the law firm Pillsbury Winthrop Shaw Pittman. "The burden is squarely on him."There are seemingly reams of rules and endless ways taxpayers can be tripped up.Nishant Mittal, a founder of Monaeo, which offers an app to help wealthy people keep track of their whereabouts for tax purposes, said New York had conducted an average of 3,024 nonresidency audits a year between 2010 and 2017. He said the audits had yielded about $1 billion for the state."My belief is once he is no longer president, he will definitely get audited," Mittal said, adding, "New York is going to make sure he actually did change his domicile."One issue that tax authorities consider is, "have you abandoned your New York residence?" Kosnitzky said.But the state considers more than whether abandoning a New York residence means giving up a brick-and-mortar house, like Trump's home on the 58th floor of Trump Tower."The term they use is where you have established strong and enduring ties," Kosnitzky said. "He's associated with New York. He's Mr. New York. It's hard for Mr. New York to disavow his residency. It's not insurmountable, but he's associated with New York."Another factor that could help Trump prove his case is whether a taxpayer who has a business has been running that business in the tax year in question.Trump "could be found to be a Florida resident because he's not technically running the company anymore," said Robin Statsky, an accountant in Manhattan. "He's basically been in Washington" and has spent more time there than anywhere other than Mar-a-Lago since he was inaugurated, she said.Tax experts said Trump is not alone in leaving. There has been a surge of departures among hedge fund managers looking to reduce their tax bills, especially if they lost the deduction for state and local taxes in the 2017 tax overhaul bill.The elimination of that deduction had a significant impact among well-off residents in New York and New Jersey, states with some of the country's highest local income tax rates.By some estimates, leaving could reduce their tax bills by nearly 13 percentage points.If New York does challenge a residency, the chances that a taxpayer will win are not good, Nittal said."The reason is, New York is pulling data from cellphone carriers" and other sources like social media sites, he said. "When the state comes in and says, 'You were not in New York,' it's really, really hard to fight it."That Trump would walk away from New York might seem hard to imagine. It was the city where he was born, where he built towers that carried his name and where his blustering personality and his romantic life -- he is twice divorced -- made him a fixture in the tabloids.It was also where he starred in "The Apprentice," the reality-television show that elevated his national profile.But since he was elected president, it has seemed that the city and Trump were headed for a breakup, with both sides openly expressing animosity for each other.In discussing his decision to leave New York on
Twitter, Trump said he had been treated poorly by political leaders in the state, despite having paid "millions of dollars in city, state and local taxes each year.''But because Trump has never released his taxes, the validity of his claim cannot be determined.Trump is also said to be angered by a subpoena filed by Cyrus Vance Jr., the Manhattan district attorney, seeking his income tax returns, though changing his residence is not likely to affect the case.At an unrelated news conference Friday, Gov. Andy Cuomo, a Democrat, speculated that the president had moved for "legal purposes," seemingly referring to the case being pursued by Vance, rather than because of New York's high taxes."He's resisting releasing his taxes. He's in litigation. I think his lawyers think this will help his legal case," Cuomo said, though he acknowledged he did not know that to be true.This article originally appeared in The New York Times.(C) 2019 The New York Times Company