Establishing a primary residence is important, especially when it comes to financial matters. The IRS offers tax breaks on the sale of homes to the tune of the first $500,000 for married couples, or $250,000 for individuals. The catch? The home in question must be the primary residence. In the same vein, having an established primary residence can help you save the home during bankruptcy proceedings. Regardless of the reason, establishing a primary residence is a great financial idea. Here is our helpful guide on how to determine your primary residence.
What is a Principal Residence?
The Internal Revenue Service does not have a specific definition as to what a principal residence exactly is. However, a principal residence can simply be defined as the place where an individual or their family spends the majority of their time. Establishing a property as your principal residence means you must spend the bulk of your time there, whether the dwelling is owned or rented. Ownership itself does not make a property a principal residence.
Proving a Property is Your Primary Residence
If you only own one home and have lived in it for many years, obviously proving that it is your primary residence will be no problem at all. However, if you have several residences where you live throughout the year, proving which one is your main residence may be a little trickier. The IRS, as well as the courts, generally will consider several things when attempting to determine an individual or family’s primary residence. These include:
- Where do you receive the majority of your mail?
- Which address is listed on your driving license?
- Which address is listed on any vehicle registrations?
- Where do you vote?
- Where do you list as a residence on your tax returns?
Proving Florida Residency
If you are seeking to establish your Florida home as your primary residence, state law is much more defined with regards to the requirements and the process. According to Florida Statute 222.17, an individual may establish a domicile as their residence:
by filing in the office of the clerk of the circuit court for the county in which the said person shall reside, a sworn statement showing that he or she resides in and maintains a place of abode in that county which he or she recognizes and intends to maintain as his or her permanent home.
This declaration also applies to individuals who wish to have their Florida residence as their primary residence, but who own properties in other states or abroad. The declaration must include the address which will be named as the primary residence, including the city and county, as well as a list of all other properties which are owned elsewhere.
Contact an Experienced Attorney Today
If you are finding yourself sinking in a sea of debt, but want to protect your hard-earned assets, you need to contact an experienced bankruptcy attorney right away. Call the Law Offices of Patrick L. Cordero for a free consultation today at (305) 445-4855.