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Topic: Question on keeping a US address and on discontinuing California residency  (Read 1775 times)

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I am a US citizen and have just married a British citizen. I will be applying for a spousal visa to move to the UK in the next couple of weeks (once our certified marriage certificate arrives). I would like to set myself up in the best possible way for tax purposes.

I have owned and lived in a flat in California for nine years, except for the two years I lived in the UK on an HSMP visa (2008-2010). During that time I just left my US accounts with my California flat address and used a mail forwarding service. However, I am selling the flat and do not intend to return to California, and would like to discontinue California residency so I won't have to pay California taxes.

I would like to maintain a US address for billing purposes for a few bank and financial accounts so that I can continue to do online things that require a US address (e.g., gifts for US family members). What would be the best way for me to do this? Friends in California have offered to let me use their address, but I assume I would be better off not having a California address if I am trying to discontinue California residency? Should I get a private mailbox service in another state? Or should I just ditch the whole idea?

Also, is there something I should do to indicate that I have discontinued California residency? I will be leaving in May or June this year.

Thanks for any help!


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Here is a well written article discussing breaking CA residency:

http://us.kpmg.com/microsite/tax/ies/tea/spring2010/article7.asp

With UK tax in mind, you need to be certain you do not have a CA living trust.
 













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    • Professional tax preparation for American expatriates
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California is one of the most difficult states for expats (http://www.taxesforexpats.com/expat-tax-advice/official-resources.html). CA deems non-residents who moved to a foreign country "domiciled" in CA as long as there are indications to the fact that expatriation was transitory. The FTB's approach is, not the words but the acts of the taxpayer should demonstrate they have no intent to return.
Having the non-US spouse permanently residing in UK is the "act" in your favor; however, keeping the mailing address in California as well as bank accounts, driver's license, voting registration are the acts working against you.
First thing to do in order to discontinue California residency is filing as part-time resident for the first year when you move to UK (2011). When you file as part-time resident you indicate the date when your CA residency ceased.
Next year, you do not file CA tax return. If FTB contacts you, you should be able to prove that you are a non-resident and non-domiciled by providing documents supporting your statement. Keeping CA mailing address will definitely be an obstacle to your plans.
Professional tax preparation for American expatriates by a Federally-Authorized EA - www.TaxesForExpats.com


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Thanks very much to both of you.

If I got a Mailboxes Etc. type of address in Nevada, say, would that cause any problems?

Thanks for the tip about the living trust--I need to check with my mother on that one.


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