Published in Financial Advisor IQ, February 15 2017
For business travelers, some states will “tax you if you just stop to fill up with gas inside their boundaries,” warns Donna Cuiffo, a managing director at Clarfeld Financial Advisors in Tarrytown, N.Y., which manages about $5 billion.
Even retirees need to plan ahead to avoid big tax headaches in coming years, she suggests. For example, Cuiffo is working with a couple who is planning to retire soon to Florida. The family wants to keep their current house in the northeast, which creates differing tax consequences since their new state of residency doesn’t assess an income tax.
Her recommendation isn’t to let taxes dictate the terms of their golden years. But Cuiffo is offering some common-sense planning solutions focused on maintaining proper travel records and maintaining an organized household. That includes encouraging them to mark on a calendar which house they’re at on a daily basis. Then she’s offering to collect and store such information each quarter for the couple.
It’s a little exercise Cuiffo is using with all of her clients who live in different locations and travel a lot between states.
“Just asking people to fill out a calendar is a great way to simplify a very complex issue,” she says, “and set up more in-depth discussions about residency taxes in the future.”