04/13
On August 27, 2019, the Department assessed the Taxpayer for personal income tax, penalty and interest for tax years 2013 and 2014. On October 7, 2019, through representation, the Taxpayer submitted a formal protest of the assessment. The primary issue to be decided in the protest was whether the Taxpayer’s spouse was a New Mexico resident in 2013 and 2014, making her out-of-state income subject to New Mexico income tax. The Taxpayer’s spouse argued that she was a resident of Virginia, where she was working and living during the tax years in question. The definition of a resident found in statute states that if an individual is physically present for less than 185 days during the tax year and leaves the state with the bona fide intention of moving permanently away from the state, the individual is no longer a resident. Regulation defines domicile as the permanent establishment to which the individual intends to return after an absence, and is the place where the individual has voluntarily fixed as their permanent home. Therefore, when an individual who was a resident moves from the state, the determination must be made as to whether the individual intends to leave the state permanently, and establish a new permanent domicile, or if the individual instead intends to return to the state. The Taxpayer’s spouse continued to own a home with the Taxpayer in New Mexico, used the New Mexico address as a mailing address, continued to be registered to vote in the state, and continued to keep a New Mexico driver’s license, all while she was living and working in Virginia. The Taxpayer also had a career where she moved temporarily to different states for her job. Following the criteria found in regulation, the Hearing Officer determined that the evidence clearly showed that the domicile of the Taxpayer’s spouse continued to be New Mexico, and this having been decided, ordered the protest denied.