Zion Healthshare

[Skookum]

You, I, and only a couple other people seem to understand this and that most states follow the same rules. A lot of folks are confusing the term 'residence' with 'residency', and that 'residency' is another term for 'domicile'. Your residence is where your feet are planted now. Your residency/domicile is where you legally do business with government agencies.

You can have several different/separate residences (where you may pay state or local taxes on all of them), but you can maintian only one residency/domicile.

What if I own a house in both California and another state, and split my time 50/50 except I spend time on the road for 3 months out of the year, leaving from either residence, and stay a few nights in South Dakota along the way?

 

[Octodad]

Health Share is NOT insurance. Whether or not you get reimbursed for medical services is totally up to the company and there is no appeal nor state or federal government regulation. Check out this article: A Christian Health Nonprofit Saddled Thousands With Debt as It Built a Family Empire Including a Pot Farm, a Bank and an Airline

You are absolutely correct. No guarantees for payment.

We have friends who have used Samaritan Ministries healthshare for years with no issues. He has had major heart issues including surgeries and had an aneurism a few years ago. All of their bills were covered, but no guarantee.

 

[Tulecreeper]

What if I own a house in both California and another state, and split my time 50/50 except I spend time on the road for 3 months out of the year, leaving from either residence, and stay a few nights in South Dakota along the way?

Which one would you file you taxes in? That would be your state of residency.

 

[Knightclimber]

Health Share is NOT insurance. Whether or not you get reimbursed for medical services is totally up to the company and there is no appeal nor state or federal government regulation. Check out this article: A Christian Health Nonprofit Saddled Thousands With Debt as It Built a Family Empire Including a Pot Farm, a Bank and an Airline

Yes, that is why I was originally against any health shares. But from what I have been able to find Zion seems legit. Though I am still nervous and not completely sold on them either. That is why I was asking for real world experiences.

 

[Knightclimber]

I was able to use MNSure and found a couple of Blue Cross/Blue Shield MN health plans which should have nationwide networks.



ACA plan qualification is determined by where you actually reside, which is not necessarily your domicile.

I did research those plans. They would only cover at most 50% of costs for anything outside of Minnesota including emergency room visits. That is not a good option. The main thing I am looking for is emergency and catastrophic costs. We are both healthy with no meds or pre-existing conditions.
Switching plans every time we change locations is not an option either.

 

[Knightclimber]

Pretending for a moment that you are just going to retire in your mid-50's but just staying put in MN and not going on the road full time, what were you planning on using for health care in that regard? I'm assuming that neither you nor your wife have health coverage from the jobs you are retiring from.

If we were staying put in Minnesota that would be simple. We would go through MNSure.

 

[Knightclimber]

Thank you to everyone who has replied. This is a great discussion and I know there are others researching this and watching and learning. Have considered doing the Florida Domicile thing for the ACA national plan but we haven’t had any desire to go to FL so that would add some complexity and logistics problems. Plus we wouldn’t be able to take advantage of the no income tax thing since we would retain property and accounts in MN.
I have researched many different options. Seems most of the plans offered for full timers are either indemnity plans or health shares.

 

[Trivet]

I did research those plans. They would only cover at most 50% of costs for anything outside of Minnesota including emergency room visits. That is not a good option. The main thing I am looking for is emergency and catastrophic costs. We are both healthy with no meds or pre-existing conditions.

I asked before, but it was kind of buried in a long post I wrote. But how did you determine the 50% coverage for anything outside of Minnesota? Is 50% what they pay for out-of-network services? (And for the record, there are a lot of plans out there, including PPO plans, that don't provide any out-of-network coverage at all.)

Did you look at the provider directory and see no in-network providers outside Minnesota? With Blue Cross, you can get that result even in states where Blue Cross PPO plans do have access to a nationwide network, but it's not apparent from just doing provider searches.

 

[Gary RV_Wizard]

I'm not sure if you read the decision, but it's all about domicile, Minnesota's rules about domicile, and being subject to taxes based on domicile under Minnesota law. It holds that under Minnesota law, the Sanchezes didn't prove they had established a domicile in South Dakota despite going through the same steps many other people have done, and leaving Minnesota and not coming back. It's a cautionary tale for Minnesotans.

I get that, but my point is that state laws define who is subject to state taxes. In this case, it is the Minnesota Dept of Revenue that set the definition of "domicile" as criteria for their taxation. And the Sanchez's did not comply with the Minnesota criteria.

Applying the standards established in the administrative rules of the Department of Revenue for determination of domicile, the tax court concluded that the Sanchezes had not established domicile in South Dakota and were responsible for income taxes in Minnesota for the full year.

A South Dakota court may well have ruled that the Sanchez's qualified for SD domicile, but that wouldn't change a thing in Minnesota, cause the only rules that matter in Minnesota tax law are Minnesota rules.

 

[Kirk]

A South Dakota court may well have ruled that the Sanchez's qualified for SD domicile, but that wouldn't change a thing in Minnesota, cause the only rules that matter in Minnesota tax law are Minnesota rules.

It is important to remember that having met the laws of a new state in no way protects you from being subject to the laws of the state that you are moving from. And that is true whether the issue is taxes, vehicle registration, or a host of other legal issues. If you, your business, your vehicles, your real estate, or your bank account is in a state it is subject to the laws of that state.

 

[Gary RV_Wizard]

It is important to remember that having met the laws of a new state in no way protects you from being subject to the laws of the state that you are moving from. And that is true whether the issue is taxes, vehicle registration, or a host of other legal issues. If you, your business, your vehicles, your real estate, or your bank account is in a state it is subject to the laws of that state.

Excellent advice!

 

[Steven L]

It is important to remember that having met the laws of a new state in no way protects you from being subject to the laws of the state that you are moving from. And that is true whether the issue is taxes, vehicle registration, or a host of other legal issues. If you, your business, your vehicles, your real estate, or your bank account is in a state it is subject to the laws of that state.

Excellent advice!

Which is why I ended up retaining tax and real estate attorneys, to guide me throught the exact steps we'll follow to positively sever all ties with my current home state, when we begin the process of establishing domicile in South Dakota later this year.

Everything is fairly straightfoward, with only a couple additional steps regarding our current home, which we intend to sell to our son on a C.F.D. basis. The contract needed to be rather specifically worded, to shield us sufficiently from any future claims by the state of us still retaining ownership, in the event they might attempt to use that as a basis to still consider us Minnesotans.

 

[Trivet]

Everything is fairly straightfoward, with only a couple additional steps regarding our current home, which we intend to sell to our son on a C.F.D. basis. The contract needed to be rather specifically worded, to shield us sufficiently from any future claims by the state of us still retaining ownership, in the event they might attempt to use that as a basis to still consider us Minnesotans.

Did they explain how they're going to do that? It would be interesting because one of the hallmarks of a contract for deed is that the seller does retain ownership until the contract is paid off in full. And as we know, Minnesota doesn't play around when it comes to hanging on to its domiciliaries.

It sounds like they might be doing something clever, and that's always interesting.

 

[Kirk]

Did they explain how they're going to do that?

I wouldn't think that it would be so very difficult as long as Steven severs his ties to Minnesota and establishes new ones in SD, or any other state, for that matter. There are many people who own real property in states that they do not live in and sometimes never have. The one thing that I would advise is to file an early state income tax return to demonstrate the intention to change states of domicile.

 

[Ex-Calif]

It is important to remember that having met the laws of a new state in no way protects you from being subject to the laws of the state that you are moving from. And that is true whether the issue is taxes, vehicle registration, or a host of other legal issues. If you, your business, your vehicles, your real estate, or your bank account is in a state it is subject to the laws of that state.

The states hate to give up tax residents.

When I started my career I moved from Ca to Ohio where I did training and establishing tax residency before being shipped out for close to 30 years.

California chased me for about 3 years before they gave up claiming I was a state tax resident. I had professional preparation provided by Peat/Marwick through the company so they knew what they were doing.

When I retired to FL I was sure to establish tax home in FL before severing ties with Ohio. Ohio has chased me for a while and while I did have my company tax preparers send them a letter stating I was not a tax resident any more they are pesistent. I send them a copy of the same letter each time I get one from them.

If it ever gets to a court type situation I hope the company steps up for a retiree and represents me...

 

[Tulecreeper]

The states hate to give up tax residents.

When I started my career I moved from Ca to Ohio where I did training and establishing tax residency before being shipped out for close to 30 years.

California chased me for about 3 years before they gave up claiming I was a state tax resident. I had professional preparation provided by Peat/Marwick through the company so they knew what they were doing.

When I retired to FL I was sure to establish tax home in FL before severing ties with Ohio. Ohio has chased me for a while and while I did have my company tax preparers send them a letter stating I was not a tax resident any more they are pesistent. I send them a copy of the same letter each time I get one from them.

If it ever gets to a court type situation I hope the company steps up for a retiree and represents me...

Interesting. I retired from CA and left in July and by August I was a resident of AR with a DL, water bill, mortgage bill, etc. The following spring I went to a local tax preparer who knew what she was doing and filed in both CA and AR. Never heard from CA again.

 

[Ex-Calif]

Interesting. I retired from CA and left in July and by August I was a resident of AR with a DL, water bill, mortgage bill, etc. The following spring I went to a local tax preparer who knew what she was doing and filed in both CA and AR. Never heard from CA again.

This was back in the 80s. California was basically arguing that my training period, which lasted the required number of Ohio training days was not a residency but a temporary assignment as they sent me overseas following it.

The company argued that they did not subsidize or pay for my living expenses during the Ohio stay so I was a bona fide Ohio resident after the 6-months or whatever.

The company was good and knew what they were doing as they hired a lot of guys from a lot of states. California was testing law and jurisdiction.

They may have given up that particular pursuit knowing that they will always end up losing.

The Ohio to FL one is concerning as millions of folks retire from all over to FL and in fact hundreds of folks from my company have done so. The fact that Ohio is being persistent leads me to believe they think they had a twist here.

The other reason it's a big deal is that the last year, my retirement year, I worked 6 months from my RV in FL (thanks covid), retired June 1 & I got a 6 figure lump sum buyout that Ohio really wants a (big) taste of.

 

[Gary RV_Wizard]

One of the wrinkles in the tax situation is that each state makes it's own tax laws and it is quite possible to remain subject to those state taxes even though you have become a "resident" elsewhere. A common example would be residing in one state but working in another - many states that have an income tax consider any money earned in the state to be taxable, regardless of where you reside. But there are often more arcane examples that may apply if you have any connection or presence in that state. You need to be very careful if you retain any property in a state, keep a vehicle there long term, have investments there, etc. That sort of thing can make the tax situation subject to debate the the state has hoards of people charged with interpreting their laws in their own favor. Ditto for state "tax courts", which are more about collecting tax $ than tax "justice".

 

[Kirk]

One of the wrinkles in the tax situation is that each state makes it's own tax laws and it is quite possible to remain subject to those state taxes even though you have become a "resident" elsewhere.

This is also complicated by the fact that many people who reside in states with high taxes attempt to use a claim of domicile in one of the lower tax states to hide from the taxes due. Because that has been done, they suspect that others are doing so.

 

[Trivet]

I wouldn't think that it would be so very difficult as long as Steven severs his ties to Minnesota and establishes new ones in SD, or any other state, for that matter. There are many people who own real property in states that they do not live in and sometimes never have.

Steven said his lawyer included language in the contract for deed that would shield him from claims by the state that he retains ownership of the house, to avoid Minnesota using the fact that he still owns the house as an evidence that he is domiciled in Minnesota. But as I said, in any contract for deed the seller does retain ownership--that's why I'm curious about what the lawyer put in the contract for deed deed to make that not the case in his situation.

But in more general terms, the Sanchez court put it this way: "Once domicile is established in Minnesota, it is presumed to continue until another domicile is actually established. ... The taxpayer has the burden of proving a new domicile outside of Minnesota." Having a rebuttable presumption may seem to a lot of people like a subtle distinction, or maybe even no distinction at all, but it has significant legal effect.

In the Sanchez case, they did everything people tell fulltimers to do (get an address in the new state, register to vote, register your vehicles, open a bank account, change your insurance, sell your house in the state you no longer want to be domiciled in). However, the Court said, "There is no evidence that their visits to South Dakota during 2004 were anything more than brief, temporary stays for the purpose of establishing a mailing address." And the Court requires (somewhat torturedly, in my view) that "One must actually reside in the new state at the time the intent is formed to make the new state one's permanent home," and found the Sanchezes didn't do that.

That's why people domiciled in Minnesota who want to not be domiciled there any more need to be really careful about how they go about it because the Sanchezes did everything right (including giving up title to their Minnesota house by selling it, which Steven isn't going to do with a typical contract for deed), and still got tripped up.