United States

Taxpayer domiciled in New York City for personal income tax purposes

Extensive Florida connections failed to establish change in domicile


On July 21, 2016, the New York Tax Appeals Tribunal issued its decision in In the Matter of the Petition of Thomas Campaniello, finding that a taxpayer with extensive connections to Florida did not change his domicile from New York City to Florida for the 2007 tax year.

The taxpayer was audited in 2011 and assessed $488,781 in personal income taxes for the 2007 tax year after a finding that the taxpayer was a resident of New York. The taxpayer originally moved to New York City in 1963, engaging in various business activities until he became the exclusive U.S. agent of a high-end furniture company. In 1975, the taxpayer opened a furniture store in New York City with the intent to open stores across the country. In 1981, the taxpayer purchased an apartment in Miami in conjunction with the opening of a store in the same city. Several other showrooms were subsequently opened in Miami and the taxpayer began to invest in real estate in Florida and New York, forming several Florida corporations in the process.

Since 1975, the administrative and bookkeeping functions for petitioner’s retail furniture business were handled in New York City. Maintenance of the Florida corporations’ book and records, and performance of all their administrative functions took place in New York. The tax filings for each of the Florida corporations list the taxpayer’s New York business address. Additionally, the taxpayer made all administrative, operational and financial decisions related to his furniture businesses, his real estate investments and his Florida corporations at his New York address. However, the taxpayer frequently traveled to Florida, often spending four days a week managing his businesses in the state.

The taxpayer maintained the Florida apartment purchased in 1981 and slowly began to spend more time in the state participating in sailing and managing the Florida-based furniture showrooms. Around 2006, the taxpayer registered several vehicles in Florida, registered to vote in 2008, received Social Security checks to his Florida address, and obtained a Florida’s driver’s license.

Under New York audit, the taxpayer responded to a questionnaire that he last filed a New York resident income tax return in 2005 and had moved to Florida to be closer to his businesses and avoid the New York weather. The auditor established that the taxpayer spent 169 days in New York in 2007, including 150 work days, and he consistently traveled to New York for the work week. The auditor also determined that he continued active involvement in operating the New York businesses and continued to maintain a New York residence where his wife lived.

On appeal, the New York Tax Appeals Tribunal concluded that the taxpayer did not establish by ‘clear and convincing evidence’ that the New York domicile was replaced by the Florida domicile in 2007. The tribunal determined that the taxpayer continually and frequently used his New York City apartment which was owned since 1979. The taxpayer was present in New York for 171 days in 2007, including several multi-jurisdiction days, maintained personal belongings, continued to receive mail at his New York address, including credit card and cell phone bills, had use of an automobile, had substantial family ties to the state, where his wife (while separated), daughter and grandchild lived, while having no family in Florida. Additionally, the tribunal found that the taxpayer continued to manage and control administrative and financial functions of his businesses in New York and the books and records of New York and Florida businesses were maintained in New York.

The tribunal, reviewing the facts and circumstances as a whole, was unpersuaded that the taxpayer relocated domiciles because of the many ties he maintained with New York. Residency analyses are not always straight-forward, especially considering the taxpayer in this case appeared to intend to live in Florida, but continued managing his businesses from New York. Changing one’s voter registration or registering a vehicle may not be enough to effectuate a change in domicile. Taxpayers living and working in multiple jurisdictions should consider the impact of their activities on a states’ claim of jurisdiction over the income produced.


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