I graduated from a Virginia university, moved to a state with no income tax for my new job, but kept my Virginia driver's license and voter registration -- do I still owe Virginia tax as a full-year resident?

Plain-English summary

This ruling adds a new evidentiary factor to Virginia's well-developed domicile-abandonment case law: continuing to vote in Virginia elections after a claimed move is now, alongside renewing a Virginia driver's license, treated as VERY STRONG evidence that a taxpayer never actually abandoned Virginia domicile.

An IRS tip led the Department to a taxpayer who hadn't filed a 2017 Virginia return. After graduating from a Virginia university in 2017, he took a job in a state with no individual income tax, leased a residence there, and continued to reside there. On appeal, he submitted a part-year Virginia return reflecting a mid-2017 move. But the Department looked at what he'd kept in Virginia: he renewed his Virginia driver's license in February 2021, kept a vehicle registered at a Virginia locality (renewed as recently as December 2020, stored at a relative's home since he didn't need a car in his new state), and -- critically -- remained registered to vote in Virginia and actually cast ballots in the 2020 and 2021 general elections (absentee in 2020).

Changing domicile requires both actually abandoning the old one (with no intent to return) and establishing a new one with the intent to remain there permanently or indefinitely -- and both have to happen at the same time (Va. Code § 58.1-302). A Virginia driver's license application requires certifying Virginia residency (Va. Code § 46.2-323.1), and while someone CAN establish domicile elsewhere while still holding a Virginia license (P.D. 00-151), renewing that license is considered strong evidence of an intent to retain Virginia domicile (P.D. 02-149).

This ruling adds voting to that analysis with real force. The Virginia Constitution requires voters to be domiciled in the Commonwealth (Article II, Section 1), a requirement echoed in the statutory definition of residence for voting purposes (Va. Code § 24.2-101). Citing a 1917 Virginia Supreme Court decision (Coopers Adm'r v. Commonwealth), the Department held that maintaining a Virginia voter registration and actually voting in Virginia elections is very strong evidence the taxpayer considered Virginia his domicile during the period he held and used that registration. Combined with the renewed driver's license, that evidence defeated the taxpayer's claim that he'd abandoned Virginia domicile in 2017 -- even though he may have genuinely intended, at some point, to make his new state permanent.

Because the taxpayer never actually abandoned his Virginia domicile, he remained a full-year Virginia domiciliary resident for all of 2017 -- not a part-year resident as he'd claimed. The Department instructed him to file an amended full-year resident return (rather than the part-year return he'd submitted) to accurately reflect his liability, giving him 30 days to do so before the assessment would be adjusted based on the best information otherwise available.

What this means for you

Anyone who moves out of Virginia but keeps a Virginia voter registration and votes in Virginia elections

That's very strong evidence, under Virginia's Constitution and case law, that you still consider Virginia your domicile -- expect it to be weighed heavily against any claim that you abandoned Virginia residency, on top of (and independent from) a renewed driver's license.

Recent graduates or anyone taking a first out-of-state job

Moving for a job and leasing a new residence isn't enough on its own to establish a new domicile if you keep meaningful Virginia ties -- particularly your voter registration and driver's license. If you genuinely intend to make the new state your permanent home, consider updating your voter registration and license there to match that intent.

Taxpayers who filed a part-year resident return but are later found not to have abandoned Virginia domicile

Expect to be asked to amend to a full-year resident return, not just have the part-year return adjusted -- if you never actually abandoned domicile, your ENTIRE year's income is subject to Virginia tax as a domiciliary resident, not just the pre-move portion.

Common questions

Q: I moved out of Virginia for a job but kept voting in Virginia elections -- does that hurt my claim that I'm no longer a Virginia resident?
A: Yes, significantly. The Department treats maintaining a Virginia voter registration and actually voting in Virginia elections as very strong evidence you still consider Virginia your domicile, citing the Virginia Constitution's requirement that voters be domiciled in the Commonwealth.

Q: Does renewing my Virginia driver's license after moving away automatically mean I'm still a Virginia resident?
A: Not automatically -- you can establish domicile elsewhere while still holding a Virginia license -- but renewing it is treated as strong evidence of an intent to retain Virginia domicile, especially when combined with other retained ties like voter registration.

Q: If I filed a part-year resident return but the Department finds I never abandoned my Virginia domicile, what happens?
A: You'll likely be asked to amend to a FULL-YEAR resident return, since failing to abandon domicile means your entire year's income remains subject to Virginia tax as a domiciliary resident, not just the period before your claimed move.

Citations and references

• Va. Code § 58.1-302 (defines domiciliary resident and actual resident; domicile change requires concurrent abandonment of the old and establishment of the new)
• Va. Code § 46.2-323.1 (a Virginia driver's license requires certifying Virginia residency)
• P.D. 00-151 (8/18/2000) (domicile can be established elsewhere even while retaining a Virginia driver's license)
• P.D. 02-149 (12/9/2002) (renewing a Virginia driver's license is strong evidence of intent to retain Virginia domicile)
• Va. Const. art. II, § 1 (voter qualifications require Virginia domicile and place of abode)
• Va. Code § 24.2-101 (statutory definition of residence/resident for voting purposes)
• Coopers Adm'r v. Commonwealth, 121 Va. 338, 93 S.E. 680 (1917) (Virginia Supreme Court precedent on voter registration as evidence of domicile)
• Va. Code § 58.1-111 (Department may estimate tax due from information in its possession when no proper return is filed)

Subject

Residency : Domicile - Failure to Abandon Virginia Domicile

Source

• Landing page: Virginia Laws, Rules & Decisions
• Ruling: P.D. 22-63

Original ruling text

April 5, 2022

Re: § 58.1-1821 Application: Individual Income Tax

Dear *:

This will reply to your letter in which you seek correction of the individual income tax assessment issued to * (the “Taxpayer”) for the taxable year ended December 31, 2017.

FACTS

The Department received information from the Internal Revenue Service (IRS) indicating that the Taxpayer may have been required to file a Virginia income tax return for the 2017 taxable year. A review of the Department’s records showed that the Taxpayer had not filed a return. The Department requested additional information from the Taxpayer in order to determine if his income was taxable in Virginia. Based upon a review of the information provided, the Department determined the Taxpayer was a domiciliary resident of Virginia for the entire 2017 taxable year and issued an assessment. The Taxpayer filed an appeal, along with a Virginia part-year return, indicating that he had moved to * (State A), a state which does not impose individual income tax, from Virginia in July 2017.

DETERMINATION

Two classes of residents, a domiciliary resident and an actual resident, are set forth in Virginia Code § 58.1-302. The domiciliary residence of a person means the permanent place of residence of a taxpayer and the place to which he intends to return even though he may reside elsewhere. For a person to change domiciliary residency to another state or country, that person must intend to abandon his Virginia domicile with no intention of returning to Virginia. Concurrently, that person must acquire a new domicile where that person is physically present with the intention to remain there permanently or indefinitely. An actual resident of Virginia means a person who, for an aggregate of more than 183 days of the taxable year, maintained his place of abode within Virginia. A Virginia domiciliary resident, therefore, working in other parts of the country or in another country who has not abandoned his Virginia residency continues to be subject to Virginia taxation. Additionally, a person who is not a domiciliary resident of Virginia, but who stays in Virginia for an aggregate of more than 183 days is also subject to Virginia taxation.

In order to change from one legal domicile to another legal domicile, there must be (1) actual abandonment of the old domicile, coupled with an intent not to return to it, and (2) an acquisition of a new domicile at another place, which must be formed by personal presence and an intent to remain there permanently or indefinitely. The burden of proving that the domicile has been changed lies with the person alleging the change.

In determining domicile, consideration may be given to the individual’s expressed intent, conduct, and all attendant circumstances including, but not limited to, financial independence, profession or employment, income sources, residence of spouse, marital status, situs of real or tangible property, motor vehicle registration and licensing, and such other factors as may be reasonably deemed necessary to determine the person’s domicile. A person’s true intention must be determined with reference to all the facts and circumstances of the particular case. A simple declaration is not sufficient to establish residency.

The Department determines a taxpayer’s intent through the information provided. A taxpayer has the burden of proving that he or she has abandoned his or her Virginia domicile. If the information is inadequate to meet this burden, the Department must conclude that he or she intended to remain indefinitely in Virginia.

The Taxpayer established several connections in State A that indicate he may have intended to establish domicile there. After the Taxpayer graduated from a Virginia university in 2017, he obtained employment in State A. The Taxpayer also leased a personal residence in State A where he continues to reside.

The Taxpayer also retained numerous connections with Virginia. He maintained a Virginia driver’s license which he renewed in February 2021. He also owned a vehicle that was registered in a Virginia locality. The registration was most recently renewed in December 2020. The Taxpayer indicates that he kept his car at a relative’s Virginia residence because did not need a vehicle in State A. In addition, the Taxpayer was registered to vote in Virginia. His voting record indicates that he voted in both the 2020 and 2021 general election, voting absentee in 2020.

Virginia Code § 46.2-323.1 states, “No driver’s license ... shall be issued to any person who is not a Virginia resident.” In fact, this section states that every person applying for a driver’s license must execute and furnish to the Commissioner of the Department of Motor Vehicles (DMV) a statement that certifies that the applicant is a Virginia resident. The Department has found that an individual may successfully establish a domicile outside Virginia even if he retains a Virginia driver’s license. See Public Document (P.D.) 00-151 (8/18/2000). However, obtaining or renewing a Virginia driver’s license is considered to be a strong indicator of intent to retain domiciliary residency in Virginia. See P.D. 02-149 (12/9/2002).

With regard to eligibility to vote, Article II, Section 1 of the Constitution of Virginia states in relevant part as follows:

In elections by the people, the qualifications of voters shall be as follows: Each voter shall be a citizen of the United States, shall be eighteen years of age, shall fulfill the residency requirements set forth in this section, and shall be registered to vote pursuant to this article.

The residence requirements shall be that each voter shall be a resident of the Commonwealth and of the precinct where he votes. Residence, for all purposes of qualification to vote, requires both domicile and place of abode.

The domicile and place of abode requirement found in the Constitution of Virginia is also reflected in the definition of “residence” or “resident” used in Virginia election statutes. See Virginia Code § 24.2-101. Consistent with the precedent established by the Virginia Supreme Court in Coopers Adm’r v. Commonwealth , 121 Va. 338, 93 S.E. 680 (1917), the Department will consider the fact that a taxpayer obtained a Virginia voter’s registration and voted in elections in Virginia to be very strong evidence that that individual considered Virginia to be his domicile during the time he held and used such registrations.

The Department acknowledges that a change of domicile occurs as part of a process in which no single factor is dispositive. As stated above, a change of domicile requires both establishing a new domicile and abandoning the old. These requirements must also be satisfied concurrently. Although the Taxpayer may have formulated the intent to establish domicile in State A, his continuing connections with Virginia, in particular renewing his driver’s license and continuing to use a Virginia voter’s registration, indicate he failed to abandon his Virginia domicile. As such, a change of domicile has not occurred. Therefore, after carefully considering all of the evidence presented, I find that the Taxpayer remained taxable as a domiciliary resident of Virginia for the 2017 taxable year.

The assessment at issue was made based on the best information available to the Department pursuant to Virginia Code § 58.1-111. The Taxpayer, however, may have information that better represents his Virginia income tax liability for the taxable year at issue. Therefore, the Taxpayer should file an amended 2017 Virginia resident income tax return, changing his filing status from a part-year resident to a full-year resident, to more accurately reflect his Virginia tax liability. The return should be submitted within 30 days from the date of this letter to: Virginia Department of Taxation, Office of Tax Policy, Appeals and Rulings, P.O. Box 27203, Richmond, Virginia 23161-7203, Attention: *. Upon receipt, the return will be reviewed and the assessment will be adjusted, as appropriate. If the return is not received within the allotted time, the assessment will be adjusted based on the best information available.

The Code of Virginia sections and public documents cited are available on-line at www.tax.virginia.gov in the Laws, Rules & Decisions section of the Department’s web site. If you have any questions regarding this determination, you may contact * in the Office of Tax Policy, Appeals and Rulings, at ***.

Sincerely,

Craig M. Burns

Tax Commissioner

AR/3930.B

Related Documents

97-301

00-151

02-149