Establishing a residence in an income-tax free state

M

MadderThanMax

Suppose that a very successful futures trader moved to a state to establish residency to avoid state income taxes. He gets an apartment, obtains a drivers license, opens up a new bank account then a new brokerage account. After six months, he moves back to his high income tax state. He keeps his apartment. He sets up a mail forwarding arrangement such that he gets his mail to his home in the high tax state. He trades from his new home. Occasionally he vacations back to his tax free place. He declares residency in the tax free state and avoids paying state income tax.

Any thoughts on this mad scheme?
 
I know a number of ppl who moved to (state )tax free state but they live there at least more than 6 months. Your problem will be a money trail. If you work in your high tax state there will be a w2 and you would have to literally commit fraud by reporting yourself as a non or part time resident of that state. If your income is from trading and you have no paper trail leading you back to the high tax state you might get away with it. Also I'm assuming you have no property in high tax state.
 
RichardRimes said:
I know a number of ppl who moved to (state )tax free state but they live there at least more than 6 months. Your problem will be a money trail. If you work in your high tax state there will be a w2 and you would have to literally commit fraud by reporting yourself as a non or part time resident of that state. If your income is from trading and you have no paper trail leading you back to the high tax state you might get away with it. Also I'm assuming you have no property in high tax state.
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No real property, no "real" job, no W2. The only real worry I have is my broker noticing all the trade IPs are not from the state I told them I live in. I could route them through the tax free state, but keeping that gear up and running is a bit of a pain.
 
Just friggin' move to a tax-free state. I left NYC years ago for Florida and now reside in Seattle, in income-tax-free Washington State, although the sales tax is 8 percent and change. You also have Nevada, Wyoming and Texas to chose from; New Hampshire, too. Visit NYC for high-end meals and shopping sprees, if you must. If you like the NW, live in Vancouver, Washington and do all your shopping over the bridge in Portland, Oregon, where there is no sales tax. (But a steep income tax.)
 
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