Can I become a state resident by using your mailbox service?

The very very short answer to this question is -- no.

Many people have asked us about becoming a resident of a state that we have a location in.  This article is to answer some of the most frequently asked questions as well as provide you general information regarding changing your residency to another state.

Being a Resident of a State

When you are a resident of a state, you are subject to the laws and jurisdiction of that state.  Not only do you get the benefits offered by the state, you are also subject to the conditions set by them. A few examples:

  • You are eligible for any state-based subsidies such as food stamp programs and housing programs.
  • You are eligible for resident tuition rates at state and local colleges, which is much lower than non-resident or international fees.
  • You will pay state income taxes, if there are any.

Due to the fact that one can obtain state-funded benefits as a resident, each state is generally fairly restrictive in determining how you can become a resident.  Several factors will help to establish your residency in a state:

  • Changing your driver license issued by the state.
  • Having a home address in that state.
  • Having a voting location in that state.
  • Having all your bills, bank statements, utilities, etc all going to that state.

Establishing Residency in a State

To establish residency in a state, the first thing to do is to have a resident address in that state.  After all, you're going to need a home to move to first before you can start moving there.  This can be a rented or purchased home.  

Once you have an address, you can begin to update your mailing address for your bills, statements, etc.  You would also be setting up utilities (electricity, water, gas, internet, phone) at your new resident home.  All this is needed before you can apply for a new state ID.

Getting Your Driver License / State ID

Obtaining a state ID, be it a driver license or normal state ID, is one formal way to proof that you are residing in that state.  This is because the DMV requires you to provide proof of residency in that state when you apply for an ID for the first time in that state.  The DMV will usually ask you to provide at least two documents for this.  Some examples of acceptable documents are:

  • Rental or lease agreement with the signature of the owner/landlord and the tenant/resident.
  • Deed or title to residential real property
  • Mortgage bill
  • Home utility bills (including cellular phone)
  • Medical documents
  • Employee documents

For a comprehensive list of acceptable documents, please visit the state's DMV website.

Is Having a Mailbox Address Sufficient For Establishing Residency?

Many people have asked us about whether they can get a mailbox address with us to establish residency.  While a mailbox account in the state helps with having an address in the state and can get all your bills over to the state, it is not sufficient to establish.  To do so, you still need to provide some sort of proof that you have a place to live there.  

Once you have established residency, then using a mailbox address to maintain presence in the state will be much easier and is allowed.  This is the case with many expats where they moved to another country for years but still maintain their link with the state at home.

What About State Taxes?

People often want to change their residency to lower their state taxes.  This is the case for many retirees, where they would move from a state with high state income taxes (such as California) to a state with no state income taxes (such as Nevada or Florida).  Some would also move to states that do not tax social security income.  Regardless of the situation, there are benefits to moving residency.

There are a couple factors to consider when attempting to move residency.  The first is that what you need to do to establish residency in the new state.  This part is already discussed in detail and is not difficult to do if you have a property to move to.

The second, and more complicated, factor is whether your original resident state will let you off the hook for paying taxes.  Some states have much higher standards in determining your resident status for tax purposes.  California, for example, defines "resident" for tax purposes as either "every individual domiciled in this state who is outside the state for a temporary or transitory purpose" or "every individual who is in this state for other than a temporary or transitory purpose."  As a result of California's expansive residency laws, many taxpayers have been surprised to find they owe California income taxes when they did not consider themselves California residents.

Therefore, if you wish to get out of paying taxes in your original state, you need to do some research and ensure that you follow proper guidelines to eliminate as many links from your original state as you can.  Having mail sent to another state is only one part of the equation, but will not help 100%.  

If you will be permanently relocating to another country, the situation may be more complicated that what you think and will require more planning.

In summary, the definition of "residency" is different for tax purposes.  It's prudent to consult a tax lawyer or CPA to determine the laws that govern this if you are looking to move out of your current state.

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