New York Rules that Taxpayer Established Statutory Residency before Becoming Domiciled

October 28, 2021

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By: Aspen Fairchild, SALT Senior Associate

At a glance

  • The main takeaway: The actions you take leading up to moving to a new state may cause you to pay income tax as a resident in that state sooner than you expected.
  • Why it matters to you: Residency audits can be invasive, and you may bear the burden of proving that you were not in the state for the requisite number of days. So if you’re preparing a move to a new state, maintain thorough documentation.
  • Next steps: Aprio’s State and Local Tax (SALT) team can assist you with residency issues and other important state-related tax topics.

Schedule a free consultation today to learn more!

The full story:

 In most states, there are two ways that an individual will be treated as a resident for income tax purposes: by becoming a statutory resident or by establishing a domicile. As the term suggests, a statutory resident is defined statutorily on a state-by-state basis. One common definition of a statutory resident is an individual who maintains “a permanent place of abode” and spends more than 183 days of the year in the state. In contrast, a taxpayer establishes domicile wherever they consider “home” which is a more subjective determination.[1]

In some cases, an individual that is in the process of establishing a new domicile may engage in activities that cause the individual to become a statutory resident before becoming a domiciliary. This was the situation in a recent New York Division of Tax Appeals determination.[2]

During 2014, the taxpayer was a professor and received W-2 wage income from two community colleges, one located in California and one located in New York. His position at the community college in New York became permanent at the end of 2014. The taxpayer maintained a home in California, which was sold on March 25, 2014. From January 1, 2014, through November 1, 2014, the taxpayer rented an apartment in New York City to use when he travelled for work. On December 3, 2014, the taxpayer bought an apartment in New York City and conceded that he established domicile in New York on that date. Upon expiration of his lease and before purchasing the apartment, the spouse claims to have stayed with various friends in New York but did not provide any other details.

For the 2014 tax year, the taxpayer filed a New York tax return as a non-resident, which was selected for audit. The state requested the completion of a non-resident questionnaire, chronological history of his residence and employment, credit card and bank statements, employment contracts, calendars for days claimed to be spent outside of New York, cellphone number, carrier and monthly bills or statements and petitioner’s closing statements for the purchase of the property in December of 2014. The taxpayer also submitted airline and train travel documents for almost 30 trips in 2014. Based on the information and documentation provided, the state concluded that the petitioner was taxable as a resident.

To be a New York statutory resident, a taxpayer must maintain a permanent place of abode in the state or city for “substantially all of the year” and be physically present in the state or city on more than 183 days in a taxable year.”[3] The taxpayer bears the burden of proof in showing that a permanent place of abode was not maintained and that they were in the state for less than 184 days of the year.

When determining if there is a permanent place of abode, New York considers if the abode is suitable for living year-round, if the taxpayer has a legal right to access it, and if so, if the taxpayer exercised that right. The taxpayer did not dispute any of this but instead maintained that the abode was not permanent because his stay was only temporary due to the nature of his employment in New York, which during that time was temporary. However, the regulatory language relied on by the taxpayer to support his position had been deleted in a 2008 amendment.

Whether a permanent place of abode was maintained for “substantially all of the tax year” is not statutorily defined, but the state, as a matter of policy in its internal 2014 Non-Resident Audit Guidelines, has interpreted this to mean a period of more than 11 months. Between the taxpayer’s apartment lease term, purchase of an apartment and the time in between for which the taxpayer did not provide any evidence, the taxpayer’s permanent place of abode was considered maintained for substantially all of the year.

To calculate the number of days spent in the state, time spent within New York for any part of the day is considered a “day,” except if the time spent is solely for boarding a plane, train, ship or bus for travel to a destination outside the state or when traveling through the state for a destination outside of the state.[4] Based on the documentation provided, the state determined that the taxpayer’s 202 days in New York during 2014, and the taxpayer was unable to meet his burden to prove otherwise. Thus, the taxpayer was determined to be a New York statutory resident for 2014.

The bottom line

Residency audits, particularly those in New York, can be very invasive. For example, the decision lists for each of the taxpayer’s 2014 trips specifically identifies the date and time of cab and ATM receipts showing the taxpayer’s whereabouts. Ultimately, the taxpayer bears the burden of providing that he or she was not in the state for the requisite number of days. Therefore, the key to a successful residency audit is properly maintaining thorough documentation throughout the year. Aprio’s SALT team has experience analyzing state residency requirements and filing obligations, and we can assist you with any residency issues. We constantly monitor these and other important state tax topics, and we will include any significant developments in future issues of the Aprio SALT Newsletter.

Contact Aspen Fairchild, SALT Senior Associate, at or Jeff Glickman, Partner-in-Charge of Aprio’s SALT practice, at for more information.

This article was featured in the October SALT newsletter.

[1] For more information about domicile determination, see this article from our August 2021 SALT Newsletter.

[2] Matter of Joseph Pilaro and Joseph Gorrie, DTA No. 829204, (Aug. 26, 2021).  The petitioners filed a joint return although the case is concerned only with the residency status of Joseph Pilaro.  The parties conceded that Joseph Gorrie was not a statutory resident in 2014.  The facts discussed above relate solely to Joseph Pilaro.

[3] N.Y. Tax Law §605(b)(1)(B); 20 NYCRR 105.20(a)(2)

[4] 20 NYCRR 105.20(c).


Any tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or under any state or local tax law or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Please do not hesitate to contact us if you have any questions regarding the matter.

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About the Author

Jeff Glickman

Jeff Glickman is the partner-in-charge of Aprio, LLP’s State and Local Tax (SALT) practice. He has over 18 years of SALT consulting experience, advising domestic and international companies in all industries on minimizing their multistate liabilities and risks. He puts cash back into his clients’ businesses by identifying their eligibility for and assisting them in claiming various tax credits, including jobs/investment, retraining, and film/entertainment tax credits. Jeff also maintains a multistate administrative tax dispute and negotiations practice, including obtaining private letter rulings, preparing and negotiating voluntary disclosure agreements, pursuing refund claims, and assisting clients during audits.