For some, it is a lifestyle move: lower cost of living, better weather and no state income tax. For others, it is a business decision, shaped by regulation, opportunity and climate resilience. Take Sylvester Stallone; he left California permanently for Florida in 2024, citing a more welcoming environment for both family and business.
No matter the reason, every day, Americans of all backgrounds relocate, bringing with them their wealth, their work, their businesses and their vision for a new start. Florida has long led the trend, followed by Texas, Arizona and Nevada. More recently, Tennessee, North Carolina and South Carolina have emerged as strong draws for both individuals and businesses.
In a country that prizes mobility, crossing state lines can quietly rewrite the laws that govern your life. Every state has its own rules for taxes, property ownership, inheritance and even family protection. What counts as separate property in one jurisdiction may be marital in another. A homestead may be shielded from creditors in one state but exposed in the next. The same trust, power of attorney, or business agreement can produce different results depending on where you call home.
Lessons Far Beyond Florida
At the center of these variations lies a single, deceptively simple concept: domicile. Domicile is foundational. It determines which state’s laws apply to almost every area of personal, estate and business planning, so before a lawyer or other advisor can make recommendations, they must know which legal system (which state’s laws) actually governs the client.
This article examines the legal implications of domicile and residency through the lens of one of the most migration-driven states in the country, Florida, whose unique blend of constitutional protections and statutory rules illustrates how dramatically state law can shape an individual’s or business’s legal and financial outcomes. But the lessons apply far beyond Florida.
Whether a client is leaving New York for Texas, California for Arizona, or Illinois for Tennessee, the principles of domicile planning remain the same: intent, consistency and coordination across every facet of life.
What Is Domicile?
A person can have many homes but only one domicile, the place they intend to make their permanent home. Residency refers primarily to physical presence. Domicile adds the element of intent. The law considers both, looking at where you live and where you plan to remain.
Few cases illustrate the stakes better than Acklie v. Nebraska Department of Revenue, 982 N.W. 2d 228 (Ne. 2022). Duane and Phillis Acklie thought they had left Nebraska for good after buying a Florida home, moving their possessions, registering to vote in Florida and obtaining Florida driver’s licenses. The Nebraska Supreme Court disagreed, citing the couple’s lingering ties, such as family, business interests, political contributions and even a “Nebraskan of the Year” award. The court applied Nebraska’s presumption against a change of domicile and ruled the Acklies were still Nebraska residents for tax purposes, liable for years of state income tax despite living in Florida.
States like New York are equally aggressive. New York’s residency audits hinge on five factors: home, business involvement, time, items “near and dear” and family connections. Even if a person claims to have relocated, maintaining a permanent abode in New York and spending more than 183 days there can trigger resident taxation. These rules are designed to keep high-income taxpayers from “moving” their address but not their life.
The lesson is simple: domicile is proven by conduct. Licenses, voter registration and utility bills help, but auditors and courts weigh the entire story. New domicile must be both declared and demonstrated.
Florida Homestead: Protection, Tax Benefits and Planning Challenges
Few concepts in Florida law are as distinctive, or as misunderstood, as homestead.
The term carries both constitutional and fiscal significance, offering residents extraordinary benefits but also imposing strict limits on how a home may be owned and devised.
Constitutional Protection
Florida’s homestead protection is rooted in Article X, section 4 of the Florida Constitution, which shields a person’s primary and permanent residence from most creditors. This protection arises automatically once the property becomes the owner’s domicile; no filing or application is required.
Homestead protection is among the strongest in the nation. It prevents the forced sale of the residence by most judgment creditors and also restricts how the property may be devised at death. These rules apply regardless of whether the owner has claimed the property-tax exemption, and they extend to the land and improvements comprising up to one-half acre within a municipality or 160 acres outside a municipality.
Proper titling is essential to preserve both ownership rights and protections. For married couples, holding title as tenants by the entireties or through a properly drafted revocable trust generally maintains full constitutional protection while allowing flexibility for estate planning.
Property Tax Benefits
In addition to constitutional protection, Florida law provides substantial property-tax relief for qualifying residents determined annually. To obtain these benefits, a property owner must be a permanent Florida resident as of January 1 of the tax year and must file an application with the county property appraiser by March 1.
The Homestead Exemption under § 196.031, Fla. Stat., reduces the taxable value of the primary residence by up to $50,000. The first $25,000 applies to all property taxes, and the second $25,000 applies to non-school levies. In 2024, the Legislature amended the law to index the exemption for inflation, and most counties list an adjusted exemption of approximately $50,700 for 2025. Additional exemptions are available to widows and widowers, low-income seniors, first responders and certain disabled persons.
Florida’s Save Our Homes (SOH) cap, found in § 193.155, Fla. Stat., limits annual increases in assessed value to the lesser of 3 percent or the rate of inflation. Homeowners may also “port” up to $500,000 of accumulated SOH value to a new Florida residence within two years of abandoning the prior homestead, preserving their capped property tax base after a move.
Planning for Homestead
Florida’s homestead protections, while generous, are accompanied by some of the most restrictive transfer limitations in the country. These rules, grounded in Article X, section 4(c) of the Florida Constitution and § 732.401, Fla. Stat., are designed to preserve the family home but often frustrate conventional estate planning, particularly for families with minor children.
- To start, a homeowner who is married cannot convey or mortgage the homestead without the joinder and consent of the spouse, even if the property is titled solely in the owner’s name. This safeguard prevents one spouse from unilaterally transferring or encumbering the family residence, reinforcing the homestead’s role as a protected asset for the household. For clients relocating from states without such restrictions, this can be an unexpected limitation on property control and refinancing flexibility.
- At death, the restrictions become even more complex. If the decedent is survived by a spouse and minor child, the homestead cannot be freely devised. By default, the surviving spouse receives a life estate with a vested remainder in the descendants, or the surviving spouse may elect to take a 50% tenancy-in-common interest instead. Any attempt to devise the homestead, whether by will or revocable trust, fails by operation of law (even if devised to the surviving spouse).
- If the decedent is survived by a spouse, but without a minor child, the homestead may only be devised to the surviving spouse. Homestead’s treatment at death is governed by a complex hierarchy of constitutional and statutory provisions. Each factor affects whether the homestead passes outside probate as “protected” or becomes part of the estate subject to creditors and administration.
- Because of these constitutional constraints, estate plans based on another state’s laws need to be reviewed when changing domicile to Florida, and Florida-based estate plans must be drafted with care. A homestead cannot be devised to a revocable or testamentary trust for the benefit of a surviving spouse unless a spousal waiver is in place. Couples with minor children should consider joint ownership or an Irrevocable Homestead Trust during life to preserve flexibility and avoid invalid devises. Advisors should also confirm title ownership and coordinate marital agreements, mortgages and trust provisions to ensure compliance with Florida’s strict homestead rules.
Florida’s homestead transfer restrictions are both protective and prohibitive. They safeguard the family home but can override otherwise well-drafted estate plans.
Florida’s Pro-Business Environment: The CHOICE Act and State Tax Reforms
Florida continues to position itself as one of the most business-friendly jurisdictions in the country. While federal agencies such as the Federal Trade Commission are moving to restrict or eliminate noncompete agreements, Florida has gone the opposite direction with the CHOICE Act (the Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth Act).
Effective July 1, 2025, the CHOICE Act allows employers to use noncompete and garden leave agreements for certain highly compensated employees, replacing the prior presumption that noncompetes longer than two years were unreasonable. The statute no longer requires proof of a “legitimate business interest,” easing enforcement for employers and reinforcing Florida’s reputation as a state that honors private contractual freedom.
The Legislature has also delivered major tax relief by eliminating the state sales tax on commercial rents under House Bill 7031, effective October 1, 2025. Florida had been the only state to levy a statewide tax on commercial rent since 1969. The repeal aligns Florida with every other state in the nation, reducing costs for businesses and incentivizing relocation. Together, the CHOICE Act and rent tax repeal reinforce a consistent policy theme: Florida aims to attract business investment, preserve economic flexibility and differentiate itself from more restrictive jurisdictions.
Crossing Legal Systems
For married couples, relocating to a new state can mean more than a change of scenery; it can mean crossing from a community property system to a common law jurisdiction, or vice versa. Many of the states contributing to Florida’s inbound migration, including California, Texas and Washington, treat assets acquired during marriage as community property. Florida, by contrast, follows the common law model, where ownership depends on title and intent rather than an automatic marital presumption.
Florida, however, recognizes that many married new residents arrive with existing community property. Under § 732.216(2), Fla. Stat., property that was community property under another jurisdiction’s law retains that character when the couple becomes domiciled in Florida. Preserving that status requires careful tracing, deliberate titling and consistent treatment across estate and trust documents to ensure that later planning does not inadvertently destroy the property’s community character.
For couples who wish to maintain or even create community property treatment, Florida offers a distinctive planning opportunity through the Florida Community Property Trust Act, §§ 736.1501 – 736.1512, Fla. Stat., enacted in 2021. The Florida Community Property Trust (FCPT) allows couples to designate property as community property. When properly structured, an FCPT can allow the entire property, rather than only the deceased spouse’s share, to receive a step-up in basis at the first spouse’s death, mirroring the treatment available in community-property states without requiring domicile outside Florida.
The FCPT exemplifies Florida’s broader effort to attract trust activity and wealth management business. In recent years, through amendments to the Florida Trust Code, the Legislature has expanded trust terms, trust situs flexibility, directed trustee statutes and family trust company provisions, positioning Florida as a jurisdiction of choice for modern estate planning.
Conclusion
Changing one’s domicile is far more than a change of address. It is a change of legal identity, determining which state’s rules govern taxes, property rights, inheritance and even personal autonomy. The decision to relocate, whether for family, financial, or business reasons, should be accompanied by thoughtful legal and tax planning to align every aspect of life under the new state’s laws.
Florida provides a compelling case study: robust constitutional protections, favorable tax policy and a regulatory climate designed to attract both individuals and businesses. Yet its legal framework also underscores an enduring truth about domicile planning nationwide: the laws that protect you can also constrain you. Understanding both sides of that equation is the key to truly making a new state “home.”
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Jones Foster Shareholder William G. “Bill” Smith, LL.M., concentrates his practice in the areas of estate planning, estate and trust administration, taxation, and transactional corporate law. He provides counsel to businesses, private foundations, and charities in matters that include business succession planning, transfers of business interests, LLC and S corporation creation, governance documents, mergers, and Treasury Regulation compliance.
