RV Tips

Things To Consider Before Changing Residency

uncle-sam-taxesIt’s common talk amongst full time RVers about which state is the best to become a resident. When you really don’t live in one place, most folks have the option of changing which state they’re currently tied.

There are some snags. Whichever state you choose, you’ll have to show proof of residency to get a driver license or to register a vehicle.

Why would someone want to change their state of residency? One word, taxes.

The subject of changing state residency always involves tax rates, vehicle registration rates, and insurance.

There are only 7 states that don’t have income tax. They are Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. Two other states only tax dividend and interest income. Those states are New Hampshire and Tennessee.

If you’re a resident of California and make roughly $100k per year, the state is taxing you about $4,500 per year. That breaks down to $375 per month. That’s lot rent for one month in a lot of places. So, if you change your residency from California to a state that doesn’t tax personal income, you could essentially save enough money to pay for camping. If you finance your RV and find good rates and a great deal on a camper, your payment could be less than $375 meaning the tax you’re no longer paying California would cover your RV payment.

Vehicle registration rates are most likely cheaper as well. To register a vehicle in California, it’ll cost you $46 plus additional fees based on the type of vehicle, license plate type, and the owner’s county of residence and driving record. If you register a vehicle in Tennessee it’ll cost you $24 per year. Did I mention that Tennessee doesn’t have a smog check. More savings. To find out how much it costs in each state, you can follow this link:

In speaking with a few folks that live in Florida that register and insure their vehicles in the sunshine state, insurance rates are a bit more here vs. Tennessee. I’m not sure how they compare to other states, but I found this useful link that shows Michigan with the highest car insurance rates.

So, several things to consider before changing state residency. Do your research before making the decision. I think it would be smart to talk to an accountant before making the decision. When speaking with an accountant, I would recommend talking to one that knows the rules of the state you are considering, not one from your own state.

By Brian Gilbert

Prior to August 28th, 2012 we had never spent the night in a camper or RV. Now we're full timers and have never looked back. If you've ever dreamed of doing the RV thing, do it. It's much easier than I ever imagined. The only thing I regret so far is not doing it sooner.