Are you an Arkansas resident?

[arcticfox2005]

We are Wyoming residents and have a second home in Arizona. We are thinking of selling the Arizona home and relocating (for about 4-5 months of the year) to northwestern Arkansas. I have some questions that can probably be answered by an Arkansas resident: (1) Is it possible for us to purchase a home in Arkansas, live in it for 4-5 months of the year, and still retain our Wyoming residency? (2) Same as above, but what if we rented rather than purchased? (3) Regarding the state income tax - I read that even non-residents are taxed on their income by Arkansas. Is this only on income that is generated in Arkansas? Our income is totally from two sources - Social Security and Arizona State Retirement System, and I really don't understand how Arkansas could tax income derived from Arizona. And finally, (4) I am assuming that if we spent the 4-5 months in Arkansas in a campground in our motorhome (with Wyoming registration and plates), that we could avoid the tax man. Correct?

Thanks in advance for your help.

Bill

 

[Wendy]

Arkansas exempts social security retirement. Don't know about state pensions. I suspect Kim Bertram knows and will jump in here with an answer.


Wendy

 

[Gary RV_Wizard]

Each state defines its own tax structure for its residents, whether full or part time. Heck, they can tax income from China if the state legislature, representing the people of the state, agree to it. As long as its your income and you place yourself under Arkansas law by becoming a resident, they can make up rules about it.

It always gets sticky when people have homes or jobs in more than one place. The laws in most states really aren't set up to handle that equitably, and no state has any incentive to give up their own revenue just to make you a happy camper. Some states pro rate based on time, i.e. if you spend 25% of the year in that state, then 25% of your income (regardless of source) is subject to the state's tax laws. However, some sources, e.g. social security, may not be not taxed anyway.

Whether you retain Wyoming residency is up to Wyoming, but I doubt if there is any issue on that score. Nor does having Wyoming as your primary residency have any effect on Arkansas tax law. If you are in Arkansas long enough to be considered a taxpayer under Arkansas law, you will have to pay whatever Arkansas law says you owe.

Whether living in an RV park in an RV avoids the Arkansas taxman once again depends on how Arkansas law is written. And, to be practical, whether you get noticed by anybody official.

You need to consult an Arkansas tax attorney and explain what you plan to do, and detail what your situation will be.

 

[Bozworth]

Arkansas is one of the less pushy states that appreciates snow birds and doesn't try to tax you to death. Just keep your current drivers license and voting cards. If you do earn Arkansas income, file a part year return for the state part, but keep your federal return where it is.

If you visit Arkansas long enough I suspect you will eventually want to retire there, particularly the area you mention, anywhere from Mena north thru Ft Smith, Fayetteville, rogers, and over to Harrison and MtN Home.

The Cherokee Village and Hot Springs areas are also older more traditional meccas you might want to spend at least a few weeks in before you decide.

 

[Bozworth]

arkansas does have a personal property tax on vehicles that are registered in the state. This is a county-based tax and isbased on depreciated value. The sales tax is 6-7 percent based on county or city, and there would never be a use tax if you paid that or more in some other state. The personal property tax runs a year behind, so if you did get plates in 2014 you would not pay it until 2015. Plates are really cheap other than being tied into the sales and pp taxes, so if your RV is older, and you are retired, you can live virtually tax free. The state has come a long way, but like Wyoming, don' expect 8 lane freeways, well developed rapid transit systems, high quality museums, symphonic orchestra's or any other expensive big city amenities.