(PHOTO: Illustration for Holding Court column by MyRye.com, using AI.)
Holding Court is a series by retired Rye City Court Judge Joe Latwin. Latwin retired from the court in December 2022 after thirteen years of service to the City.
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By Joe Latwin
(PHOTO: Former Rye City Court Judge Joe Latwin in his old Rye City Court office on Monday, December 5, 2022.)
Be careful what you wish for.
In 1976, British Prime Minister Margaret Thacher said “The problem with socialism is that is eventually run out of other people’s money.” Now the chickens are coming home to roost. Recently, New York City Mayor Mamdani, facing a $2.2 billion budget shortfall for FY2026 and a projected $10.4 billion gap for FY2027. Not surprising when it was announced he is spending $81,000 to house each illegal alien! So, the Mayor has asked the State Legislature to reduce the State Estate Tax exemption from $7 million per person to $750,000 and tax at a 90% rate. In 2022, NY Governor Hochul said that “if New Yorkers didn’t like New York, they should get out and go to Florida.” Well, apparently, they did. Now Governor Hochul is begging people who moved to Florida and Texas because of high taxes to move back to New York to pay higher taxes to fund New York’s generous social programs. In New York State, the top 20% of family income households (above $144,000) pays 40% of the taxes. The top 1% (over $880,900) pays 13.5% of taxes. We don’t have a revenue problem, we have a spending problem, not even addressing crime, unsafe subways, stifling regulations, and outrageous energy bills. New York City spends more than the entire State of Florida despite Florida having almost three times the population. New York City spends 2.5 times more per person than the State of Florida. Faced with potentially greater confiscatory levels of taxes, more New Yorkers are thinking about moving to more tax friendly places – sunny Florida, booming Texas, bucolic Tennessee. But things are so bad in California, where they measure the loss of population by counting the number of one-way U-Haul rentals from California, that California is contemplating taxing people who moved out of state.
Here are some of the New York rules to avoid being taxed by New York. If you leave New York, you can still be taxed if you are a New York domiciliary. A domicile is where you intend to return. Among the factors to determine domicile are: (a) do you maintain a residence; (b) are you actively employed or doing business here; (c) how much time do you spend here; (d) where are your sentiments tied; (e) where are your family connections & (f) other factors such as where your cars are registered, where you are registered to vote, where do you bank, and where are your doctors.
Even if you are not domiciled in New York, you can still be taxed if you are a statutory resident. You will be deemed a statutory resident if you (a) maintain “permanent place of abode” which can be owned or leased and is suitable for year-round use; & (b) spend more than 183 days (or parts of days) in New York.
Last, your estate may be subject to a New York State Estate tax even if you are a nonresident, if your estate includes real estate or tangible personal property located in New York (i.e., cars, artwork, jewelry, but not cash, credits and securities.
We will run out of other people’s money. If you are able to arrange to leave and avoid New York’s tax burdens, please ask those left behind to kindly turn off the lights and enjoy paying for their ever-increasing share of the tax burdens until everyone runs out of money or leaves.