Domicile

A domicile is an individual’s principal place of residence, the place to which he intends to return when he goes out. The location of a person’s domicile is typically determined by this intent, as it is the place he has established his home, having no plan to vacate it soon. In a legal sense, an individual’s domicile becomes important in determining in which court he may file a legal action, and to which state he pays taxes. To explore this concept, consider the following domicile definition.

Definition of Domicile

1. noun. A person’s permanent, fixed, or principal home
2. noun. A person’s legal residence

Origin      1470-1480       Middle French domicilium

What is a Domicile

A domicile is a person’s true and permanent home, the place where he intends to remain, and to which he plans on returning if he leaves. For instance, a person’s domicile would be the home to which he returns after a two-week trip to Europe. In the United States, an individual’s domicile determines to which state he pays taxes, which court he may file a legal action, and to which state he may look for government assistance programs. When an individual passes away, his estate is governed by the laws of the state in which his domicile was located.

In the United States, each person is considered to have a domicile, and may maintain more than one domicile. The law does not consider any person to have abandoned his domicile until he has established a new one.

For example:

John lives and works in New York but, because he travels a great deal to Los Angeles, he decides to buy a home in California. John spends about six months in each home, and he considers this a permanent arrangement. John now has two domiciles.

Alternatively: John’s employer transfers him to their office in Los Angeles, and he is to start within the week. John packs his home and heads to California, placing his belongings in storage, and renting a hotel room, until he buys a home. John’s domicile remains in New York until he establishes a home in California, whether by purchasing a home, or by leasing a home, at which time his domicile becomes California.

Corporate Domicile

Businesses have legal domiciles, much the way people do. A corporate domicile is the state in which the corporation is registered, and the state in which it maintains its principal place of business. Corporate domicile governs the business’ legal status as a business entity, as well as business taxes. Laws governing corporations vary by state, and some states offer more incentives than others do in the attempt to draw businesses to incorporate in their jurisdiction. Because of this, many businesses incorporate in those states, but primarily operate the business in another location. In such a case, the corporation has two domiciles.

Types of Domicile

U.S. law recognizes three types of domicile: domicile of birth or origin, domicile of choice or necessity, and domicile by operation of law. While many people believe the term domicile to refer to a specific residence address at which someone lives, or business operates, is has more to do with the country, state, county, and city in which the individual resides. Which type of domicile applies to any individual depends on the circumstances.

Domicile of Birth or Origin

Domicile of birth refers to the domicile, or place of residence, of anyone as a matter of where he was born. Domicile of birth is generally assigned as the domicile of the child’s family, until the individual reaches the age of majority and establishes his own domicile. When a child is born within a marriage, he is assigned the domicile of his father. If the child is born out of wedlock, he is typically assigned the domicile of the mother.

Domicile of Choice

A domicile of choice refers to any domicile acquired by the individual himself. Domicile of choice may be the person’s domicile of birth, if he chooses to remain once he reaches an age to choose, or it may be any other domicile chosen by the individual. Domicile is also used to refer to a change of residency made by choice or necessity. While the law presumes domicile of choice, the term may only be applied to individuals competent to make such a choice.

By law, any competent adult may acquire a domicile of choice if the following conditions are met:

1. Consent – a the individual must be of legal age, and have freedom of choice
2. Intent – the individual must have intent to change his or her current residence to another state or jurisdiction
3. Permanency – the individual must intend to make this new residence his or her permanent residence.

Domicile by Operation of Law

Domicile by operation of law refers to domicile imposed by legal statute, with no consideration given for the person’s intent to change residency. When domicile is assigned by operation of law, the individual has no freedom or right to choose otherwise. Individuals who may be subject to domicile by operation of law are generally those people under another’s control, such as a wife or child, and those who have been assigned a domicile by another, as a matter of law.

For example, individuals who hold public office, or who have been tasked a public duty, may be required to reside in another state for the execution of their duties. In this case, the individual may have two domiciles for the duration of the duty, retaining his original domicile with the intent to return at some point. This is most commonly seen where people serve as members of the military, or who serve as ambassadors, public agency heads, and for prisoners incarcerated in another state. Domicile by operation of law also applies to the President of the United States.

Domicile vs. Residence

The term residence refers to the place where an individual lives. This may be a specific address, or even refer to a building in which the person lives. The term domicile, on the other hand, refers to the residence at which an individual lives, with the intent to make it his permanent home. As the very definition of domicile includes the term residence, it clearly takes on a larger meaning. A person’s domicile has more to do with the person’s duties, obligations, and personal rights, than simply being present at a home.

A residence is the dwelling in which a person lives, and may be considered more temporary than a domicile, as a person can have his residence in one location, and his domicile in another. An intent for permanency, which is required in a domicile, is not required to establish a residence. Even transient or short term stays in a dwelling can constitute a residence.

For example:

Sally, whose domicile of birth is her parents’ home in Sacramento, California, chooses to attend college in Utah. Sally moves most of her things into an off-campus apartment, where she stays while school is in session. Sally has no intent to make Utah her permanent home, but plans on returning home, both during breaks, and after she finishes college. As such, Sally has changed her residence, but her domicile remains at her home in California.

Establishing a New Domicile

Factors that determine where an individual’s domicile is located include where he lives, where his car is registered, and where he votes. In generally, these things are done in the state in which he intends to be his permanent home. Claiming a new domicile is not always as easy as buying a home in a new state, registering a car there, and registering to vote. This issue usually only comes up when a state says the individual is domiciled within that state.

To prove the intent to maintain domicile in a specific place, it is generally necessary to maintain most important activities in that state. A person may show his intent to maintain domicile in a specific state by using the address of that residence in important documents and transactions, including:

• Tax returns
• Social Security records
• Passport
• Homeowners and vehicle insurance
• Credit cards
• Bank accounts
• Brokerage or investment accounts

When creating estate planning documents, such as a will or trust, or when appointing a power of attorney, the individual should also make his preferred state of domicile clear, with an explicit statement. In addition, when establishing a new domicile, the individual should use his new address when taking the following steps after moving into that state:

• Register to vote
• Register a vehicle
• Obtain a driver’s license or state-issued ID
• File taxes
• Use local professionals, such as doctors, lawyers, and accountants

Serviceman Establishment of New Domicile

In 1942, Clark F. McIntosh and his wife lived in Wyoming, when he entered the military service. Within four months Clark was sent overseas. Three years later, Clark’s wife was advised by her doctor to leave Wyoming due to the climate, expressing his belief that the dry Arizona weather would be beneficial to her health. Clark conversed with his wife through letters, regarding the move, and he agreed it was the right thing to do. Clark’s wife and infant son, as well as the wife’s mother, moved to Arizona, where they bought a house and awaited Clark’s discharge from the service.

Clark McIntosh was discharged toward the end of 1945, at which time he returned to his family at their Arizona residence. In 1950, Clark filed for a state income tax exemption available to ex-servicemen domiciled in Arizona prior to September 1, 1945. As Clark’s family had relocated to Arizona in 1942, he felt he was entitled to the tax exemption, but it was denied by the county tax assessor. McIntosh sued the county, seeking to have the court validate his domicile in the state at the time his wife and child established residency. The court, relying on the Arizona Constitution, denied McIntosh’ claim.

Clark took his case to the state Supreme Court, again seeking a clarification of the term “domicile,” and its applicability to servicemen. While Maricopa County claimed that McIntosh had not personally established his domicile in Arizona until 1945, Clark pointed out that, not only had is family established residency, but he had demonstrated his intent to change his domicile through the letters exchanged with his wife.

Referring to both the language in the Arizona State Constitution, as well as referring to case law on the topic, the Arizona Supreme Court ruled against Clark McIntosh, holding that he had not yet become domiciled in Arizona until he returned home from the service on November 1, 1945. The Court ruled that sending his family to Arizona, even with the intent to join them there, was not enough to make it his domicile of choice, but that required both his intent and his presence were necessary to affect the change.

Related Legal Terms and Issues

• Intent — A resolve to perform an act for a specific purpose; a resolution to use a particular means to a specific end.
• Jurisdiction – The legal authority to hear legal cases and make judgments; the geographical region of authority to enforce justice.
• Residency – The geographical location in which a person lives or resides; the location of a business’ main office or to which a corporation is registered.