Changing Your State of Legal Residence In Conjunction With A PCS Move

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Military personnel have long had the ability to claim a state of residence and maintain that residency regardless of where military orders may send them.

But how do you do it?

The Military Spouses Residency Relief Act or MSRRA  allows military spouses to change their state of residence for tax purposes at any time, but beware - making the change may have unintended consequences.

 

Before you declare residency in your new or old state, consider the following factors:

  • Where do you want to vote?
  • Where do you want to register your car(s)?
  • Where will you file state income taxes or will you file them at all (several states have no state income tax)?
  • Will your residency choice affect tuition rates at a college or university?
  • Check the impacts on county and local taxes, fees and services.
  • Is your state of residency a community property state?
  • How will your state of residency affect your insurance rates – home, auto, business?
  • Ensure your will, Power of Attorney, and other estate planning will be valid in your state of residency.
  • Are there any college savings plans tax breaks in one state versus another?
  • How will a different residency affect you if you own or operate your own business?
  • Will property rights change if you opt for residency in one state versus another?
  • How will personal property taxes be affected if you change your state of residency?

Check your state's department of revenue web site for tax form changes related to MSRRA.

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