When the comedian Joan Rivers died back in September, there was an unusual provision in her estate plan: Rivers’ will named her state of residency as New York, but her domicile as California.
This was clearly done to take advantage of the tax situation in each state: New York has a state estate tax, whereas California does not. But Rivers’ will was filed through the legal system of New York, her primary residence, though probate is usually done in the state of domicile.
Many wealthy older clients face the same decision, since they may have summer and winter residences, or vacation homes in which they spend a significant amount of their time. A person can have many residences, but only one domicile. And that choice of domicile can significantly impact their estate planning. A client should take that decision seriously.
Domicile is typically a question of fact based on the individual’s intent to remain in, or return to, a particular state and permanent place of abode. The California Court of Appeal has provided a good working definition: “domicile” is the one location with which, for legal purposes, a person is considered to have the most settled and permanent connection.