Keep A Low Profile

I have discussed on several occasions ways in which to avoid paying State taxes. Most of them require establishing a tax free state as your tax home. However, as with all tax related matters, the burden of proof lies with the taxpayer to prove s/he is not subject to a specific State’s taxes. The State merely has to claim that you are subject to its jurisdiction and then you have to make the case that you aren’t.

Besides the normal steps for establishing a tax home in tax free States, it would be smart to maintain a low profile in the taxable States. Here is a story of some pilots who live in Minnesota who were pretending to live in tax free States, while being far too active in their MN communities. I’m sure they were also flaunting their ability to avoid MN taxes. More tax breaks have been lost over the past decades by big-mouthed beneficiaries who can’t resist the temptation to brag about it. Envy is widely prevalent in this country. It is just a matter of time before people who don’t receive the same tax breaks are going to try to get yours taken away.

KMK