BEFORE THE UTAH STATE TAX COMMISSION
Petitioners, ) FINDINGS OF FACT,
: CONCLUSIONS OF LAW,
v. ) AND FINAL DECISION
AUDITING DIVISION OF THE ) Appeal No. 93-2161
UTAH STATE TAX COMMISSION, :
) Account Nos. XXXXX and
Respondent. ) Tax Type: Income
STATEMENT OF CASE
This matter came before the Utah State Tax Commission for a Formal Hearing on XXXXX. G. Blaine Davis, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner was Mr. XXXXX. Present and representing Respondent were Ms. XXXXX, Assistant Attorney General, together with Mr. XXXXX, Mr. XXXXX and Mr. XXXXX.
Based upon the evidence and testimony presented at the hearing, the Tax Commission hereby makes its:
FINDINGS OF FACT
1. The tax in question is income tax.
2. The period in question is calendar year XXXXX.
3. Respondent has made a determination that the income of Petitioner is taxable by the State of Utah for the calendar year XXXXX. Petitioner claims that such income for the relevant period is not taxable to the State of Utah because he claims to have been a resident of the state of XXXXX.
4. Petitioner, Mr. XXXXX, who will be referred to herein singularly as Petitioner, attended college within the State of Utah, and then lived in Utah and XXXXX.
5. Petitioner, Mr. XXXXX and his wife, XXXXX, were married in XXXXX in XXXXX. XXXXX was from Utah.
6. Shortly after their marriage, XXXXX and XXXXX returned to the State of Utah in XXXXX of XXXXX. Prior to that time, Mr. XXXXX had lived primarily in XXXXX for several years.
7. XXXXX and XXXXX rented a house on XXXXX in Salt Lake City, Utah. Mrs. XXXXX and her children from a prior marriage lived in that same house from the time of the marriage of Mr. and Mrs. XXXXX through the audit period, a period of more than six years.
8. During the course of the marriage, Mr. XXXXX has regularly worked in XXXXX during the summer months when it is warm enough to perform construction work. When the weather turns too cold to continue construction work, then Mr. XXXXX returns to live with his wife in XXXXX, Utah.
9. During XXXXX, Mr. XXXXX also worked for a brief period in XXXXX, and then returned to be with his wife in XXXXX, Utah.
10. XXXXX is employed in XXXXX, Utah, by operating her own business, known as "XXXXX."
11. During the year XXXXX, Petitioner, XXXXX, testified that he was in XXXXX from the middle of XXXXX through XXXXX, was then in Utah for approximately two weeks, and then returned to XXXXX sometime in XXXXX and stayed through late XXXXX. He then returned to XXXXX, Utah in late XXXXX and stayed through the end of the year. He was not in the State of Utah for 183 days or more during XXXXX.
12. During XXXXX, Petitioner owned two parcels of real property in XXXXX. However, he did not live in either parcel. Petitioner did have a mortgage on at least one of the parcels, and the mortgage was with a bank in XXXXX.
13. Petitioner has at least one motor vehicle registered in the State of XXXXX. His wife has a motor vehicle which is registered within the State of Utah.
14. Petitioner had insurance on the buildings which he owns in XXXXX, and carried the insurance through an insurance agency that does business in XXXXX.
15. Petitioner had a telephone within the State of XXXXX in his name.
16. Petitioner is a member of a union and his union dues card lists an XXXXX address.
17. Petitioner is registered to vote in XXXXX, having registered to vote there on XXXXX.
18. From the time of the marriage of Petitioner to his wife in XXXXX, Petitioner and his wife filed separate tax returns. However, in XXXXX, Petitioner and his wife filed a joint federal tax return, and filed a joint Utah tax return which was never amended.
19. Petitioner and his wife filed a XXXXX resident long-form individual income tax return which showed an amount of tax due, but the amount of tax due was not enclosed with the return. Petitioner thereafter filed an amended return as a non-resident or part-year resident individual income tax return, which showed a refund due. The Auditing Division received the amended return, but did not allow it as an amended return because they were of the opinion Petitioner did not qualify to file a non-resident or part-year resident return.
20. The Petitioner is a member of the XXXXX, and his church records are located with the XXXXX Ward in XXXXX, Utah.
21. When Petitioner is located in XXXXX, he has a post office box at which he receives his mail.
22. Even though Petitioner owns two parcels of real property, both of those properties are rented to other individuals, and he does not reside in either of those parcels when he is in XXXXX. Instead, he lives primarily in XXXXX which are frequently located a substantial distance from any major city.
24. All of the documents submitted by Petitoner to support his claim of being a resident of XXXXX list only his post office box as his address.
A tax is imposed on the state taxable income of every resident individual for each taxable year. (Utah Code Ann. '59-10-104).
A "resident individual" is either:
a. an individual who is domiciled in this state for any period of time during the taxable year; or
b. an individual who is not domiciled in this state but maintains a permanent place of abode in this state and spends in the aggregate 183 or more days of the taxable year in this state. (Utah Code Ann. '59-10-103(l)(j).)
For purposes of determining whether an individual is domiciled in this state, "domicile" shall mean:
a. the place where an individual has a true, fixed, permanent home and principal establishment, and to which place he or she has (whenever he or she is absent) the intention of returning. It is the place in which a person has voluntarily fixed the habitation of himself or herself and family, not for a mere special or temporary purpose, but with the present intention of making a permanent home. (Rule R865-9I-2, Utah Administrative Code).
After domicile has been established, two things are necessary to create a new domicile; first, an abandonment of the old domicile; and second, the intention and establishment of a new domicile. The mere intention to abandon a domicile once established is not of itself sufficient to create a new domicile; for before a person can be said to have changed his or her domicile, a new domicile must be shown. (Rule R865-9I-2, Utah Administrative Code).
A part year resident is an individual who changes his or her status during the tax year from a resident to a nonresident or from a nonresident to a resident. (Rule R865-9I-2, Utah Administrative Code).
DECISION AND ORDER
Based upon the testimony in this proceeding, Mr. XXXXX was not in the State of Utah for a period of 183 or more days, but he is domiciled in this state. He therefore is deemed to be a resident of the state of Utah for income tax purposes.
Based upon the legal definitions of domicile, the Commission finds that Mr. XXXXX has a true, fixed permanent home and principle establishment to which place he has, whenever he is absent, the intention of returning. That location in Utah is the place at which he has voluntarily fixed the habitation of himself and his family, not for a mere special or temporary purpose, but with the present intention of making a permanent home. He returns to Utah after each work engagement in XXXXX, and he returned to Utah after a work engagement in XXXXX.
On the other hand, it appears that the substantial contacts which Petitioner had in the State of XXXXX for calendar year XXXXX are primarily for employment purposes. Mr. XXXXX did not have a true, fixed or permanent home and principle establishment in XXXXX to which he intended to regularly return. His most permanent attachment to the State of XXXXX appears to be his post office box. Likewise, he has not fixed XXXXX as the habitation of his family.
Based upon the foregoing, it is the order of the Utah State Tax Commission that Mr. XXXXX was domiciled within the State of Utah for calendar year XXXXX, and that his Petition for Redetermination is therefore denied. The assessment made by the Auditing Division against Petitioner is hereby sustained. It is so ordered.
DATED this 22nd day of November, 1995.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val Oveson Roger O. Tew
Joe B. Pacheco Alice Shearer
NOTICE: You have twenty (20) days after the date of a final order to file a Request for Reconsideration with the Commission. If you do not file a Request for Reconsideration with the Commission, you have thirty (30) days after the date of a final order to file a.) a Petition for Judicial Review in the Supreme Court, or b.) a Petition for Judicial Review by trial de novo in district court. (Utah Administrative Rule R861-1A-5(P) and Utah Code Ann. ''59-1-601(1), 63-46b-13 et. seq.)