Why We Chose Nevada As Our Domicile State
This post is about why we chose Nevada as our domicile state. If you’re already familiar with what a “domicile” is and what makes a state RV-friendly, skip down to “Why We Chose Nevada”.
What Is “Domicile”?
Domicile is defined as treating a specific place as your permanent home. The government requires everyone have a legal domicile. Your home state is where you will file your taxes, register to vote, get your driver’s license, register your vehicles, and get your health insurance. The word “residency” gets used interchangeably with “domicile”.
Our domicile was North Carolina until recently. We were already established as North Carolina residents and all we did when we hit the road was change our mailing address to Jerud’s mom’s (who also lived in Asheville). She handled all of our mail for us. This made our roadlife transition easier and we kept it this way until recently.
When Jerud’s mom moved away from North Carolina earlier this year, Jerud and I decided it was time to think about where our domicile would be. We could’ve kept claiming North Carolina as our domicile. But the main reason we didn’t is because we don’t make money in the state of North Carolina so why would we continue paying income tax to the state? For example: when we worked in Washington state (who doesn’t have income tax) we still had to pay income tax on the money we made in Washington to North Carolina because that’s where our domicile was.
The burden is on you to show that you’ve moved to another state. North Carolina was happy to continue collecting income taxes from us until we told it otherwise.
What Makes A State RV-Friendly?
South Dakota, Texas and Florida are widely considered RV-friendly states. Quickly I’ll list what makes them RV-friendly (each point below doesn’t necessarily apply to all three states):
No state income tax
Low to mid-range vehicle insurance
Affordable vehicle registration
Convenient or no vehicle inspection
Reasonable health care plans (at least that used to be the case)
Has mail forwarding companies to handle your mail
Easy to establish domicile (for example: you can claim Nevada as your domicile state after presenting a receipt with a 30-day stay in an RV park or hotel)
Doesn’t require returning in-person to renew license
Escapees RV Club is established in all three states and as a member you can use their physical address to establish domicile. In addition, they offer mail forwarding services.
Why We Chose Nevada
So, if there’s already three established RV-friendly states, why didn’t we just go with one of those? The main reason was that we didn’t want to have to drive to any of them, even after we’d established our domicile there.
Florida is too far (we plan to stay west of the Mississippi for a long time)
Texas isn’t our thing (unlike a lot of people, we don’t choose to winter in Texas)
And South Dakota is kind of out of the way and has really, really cold winters.
Out of those three states, South Dakota was really the only real contender for us. It’s closer to drive to than Texas and Florida, and it only requires you to return to the state for one night every 5 years. But for us Nevada still came out on top mainly because of health insurance. Health insurance costs are a lot lower than South Dakota, and Nevada offers PPO plans while South Dakota only offers HMO plans under the affordable care act.
Here are additional reasons why we chose Nevada:
It is very “central” to most of the states we spend time in or want to hang out in, so coming back is easy.
It has no income tax or dividend tax.
(I originally wrote that Nevada doesn’t have property tax, but I was wrong. A reader corrected me and here’s the property tax information.)
Although auto insurance is on the high side when compared to other states, outside Clark and Washoe counties (Las Vegas and Reno) can be quite low. Insurance is high because Nevada is a “24 hour state” (serves alcohol 24-hours) and a mining state. But the RV park we stayed at and used to establish our domicile was in Elko County, which has low vehicle insurance rates. We saved close to $200 by switching auto insurance from North Carolina to Nevada.
Nevada bases vehicle registration costs on the new MSRP for the vehicle, then depreciates that value according to the vehicle’s age. So for a newer vehicle, registration costs aren’t as low as SD/FL/TX, but we’re OK with that because our truck and RV are almost 20 years old and were “fully depreciated” according to the DMV. I think it’s the higher registration costs for new / high-value rigs that cause Nevada to not be considered an “RV friendly state”.
Health insurance costs are on the low side and the affordable care marketplace offers PPOs (unlike some of the “RV friendly” states, now). HMO plans aren’t as attractive to us despite having cheaper and lower deductibles, because they are only valid at in-network facilities, which typically are only in the state you’re domiciled in. Since we live on the road, the reality is that we’ll rarely go to an in-network facility. PPO plans are more expensive and have higher deductibles, but they do offer (reduced) coverage outside the network. We want to have health insurance that will allow us to go to any doctor whenever we need to and not have to drive back “home” to see a doctor. We are far more likely to land in an out-of-state ER than any doctor’s office. But then again, everything related to health insurance is always changing. Page 20 of the 2017 Marketplace Landscape Brief compares health insurance costs in every state.
The winters can be mild (example: Las Vegas) if we ever need to come back for whatever reason during the winter.
There was a mail forwarding service in Nevada that could handle our mail for a good price. While it’s not necessary to have a mail forwarding service in the same state as your domicile, it does make things a bit easier. After contacting many mail services, we signed up with Inc. Paradise, located in Las Vegas.
INC. PARADISE SERVICES
Only $99/year for a mailbox that can receive mail for up to three people
Electronically savvy. They will notify you to let know who you’ve gotten mail from and easily let you choose to scan, mail forward, or trash it.
Prices to scan is affordable ($1 for 1-10 pages)
While their mail forwarding costs is a bit expensive ($5.50 plus postage), we knew we wouldn’t have them forward much.
Will hold onto our mail for extended period of time
Can also provide “registered agent” services (additional cost) if you intend to form a company in Nevada
Jerud compared 43 states regarding income/dividend/property taxes, vehicle registration costs, health insurance, and auto insurance and Nevada came out to be the third-cheapest state (for us). Since it was also the closest state for us to get to and its domicile requirements were fairly easy, Nevada it is!