World / Politics

Florida residency may boost Trump's re-election bid and lower his tax bill

Bloomberg

President Donald Trump, a lifelong New Yorker, has changed his primary residence to Florida, a move that could benefit his re-election campaign — and his tax bill.

The president says in a declaration of domicile filed in Palm Beach County, Florida, that he has become a “bona fide resident of the State of Florida residing at” his Mar-a-Lago resort in Palm Beach.

Trump adds in the document, dated Sept. 27, that “I formerly resided at 721 Fifth Avenue” in New York. That’s the address of Trump Tower.

He lists “other places of abode as” 1600 Pennsylvania Ave., NW, in Washington — the White House — and his golf resort in Bedminster, New Jersey.

First lady Melania Trump has also changed her state residence to Florida, in a document dated Oct. 3.

The White House did not respond to questions about why the Trumps made the change, which was reported Thursday night by the New York Times.

The president, who grew up in Queens and rose to fame as a real estate developer in Manhattan, remains deeply unpopular with voters in his hometown. He lost the heavily Democratic state in 2016, but narrowly won Florida, which remains under Republican control.

Florida will be contested in next year’s election, and becoming a resident of the state could help Trump’s campaign there.

In any event, he could see large tax savings from a residency switch to Florida. New York State and city impose a combined individual income tax rate of nearly 12.7 percent for top earners. Florida officials have long enticed wealthy people from the Northeast with promises of warm sunshine — and zero state income taxes.

The financial hit of state income taxes increased following Trump’s 2017 tax overhaul, which limited the federal deduction for state and local taxes to $10,000. The deduction was previously unlimited, allowing some top earners to take deductions that can be worth millions of dollars.

Trump’s move, if motivated by taxes, would bolster a point that his political foes have been making for months: His tax law is hurting Democratic-led, high-tax states by prompting the wealthiest residents to move elsewhere. Gov. Andrew Cuomo, a Democrat, has called the change “economic civil war.”

Carl Icahn, another New Yorker and billionaire, is planning to move his home and business to Florida to avoid the Empire State’s higher taxes next year.

New York doesn’t make it easy to leave, however. New York’s Department of Taxation and Finance will go to great lengths to keep wealthy residents on their tax lists. New York considers people residents if they maintain a residence there for at least 11 months of the year and spend at least 184 days in the state.

The states’ methods can be aggressive: Issuing subpoenas to pore through credit card statements, bank transactions or phone records to track a taxpayer’s location, and sending auditors to interview doormen or confirm doctors’ appointments.

The law in the District of Columbia says that elected officials who work in Washington should claim their home state for tax purposes.

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