A Bit About Domicile State Selection

As it turns out, South Carolina is actually the friendlier state when it comes to vehicle taxes compared to South Dakota, at least if you have a travel trailer. Mostly because SC doesn’t collect sales tax on travel trailers. At all. It’s hard to beat that. Even when you consider that SD’s title and registration fees are cheaper.

Don’t start planning to make SC your full-timing domicile state though. We pay out the butt here in income tax. At least our gas is cheap, not that that will matter much once I’m traveling and no longer bound to one state.

Now maybe you’re wondering why I’m going on about domicile stuff when it’s mail forwarding I’ve been working on the past two days. What it comes down to is you need to pick a domicile state before deciding on a mail forwarding company, because you’ll be using the address the mail forwarding company gives you as your ‘home’ address.

I had decided to make South Dakota my state of residency a long time ago and I’m going to be honest here, it wasn’t because I spent hours researching it, it was because the majority of pre-retirement full-timers do. I figured all those people couldn’t be wrong. Well, I have learned a few things about domicile state options, just from extensive browsing around on RVing forums. I’ll share it here, but don’t consider this a definitive guide, rather general bit of wisdom to consider if you’re early on in the process of preparing to full-time yourself.

The three most common domicile states for full-timers are South Dakota, Texas, and Florida. They all share no income tax in common, and have other perks as well.

South Dakota’s base state sales tax is 4%, the lowest of the bunch, and their sales tax for vehicles and RVs is 3%. They also don’t have a vehicle safety inspection, and you can register your vehicles without being in the state. In order to become a resident you just need a mailing address (hence the need for a mail forwarding company in South Dakota) and to spend one night in South Dakota in a campground or hotel and take the receipt with you to the DMV to get your driver’s license. There is some paperwork involved with each of these steps which I won’t go into in detail here since it’d be a post in and of itself, but if there is enough interest I will gladly write about it in the future or you can contact me by e-mail or social media for a more private audience.

Texas is I believe 6% sales tax, but they have the benefit of the Escapee’s RV club, which goes to bat with the government for full-timer’s rights. Another benefit is it’s southern location, you don’t need to worry about what time of year it is when you need to renew things.

Florida is well, Florida. You have to spend a certain amount of time a year there to be able to call it your home state, but as it’s the warmest place to spend the winter months in the continental U.S., so people who choose it wouldn’t call that a disadvantage.

Go to Rv.com, the Escapees forum, or any other large RVing forum and you’ll find many hours worth of discussion on what the best domicile state is. I will give you one important piece of advice though:

If at all possible, keep all of your affiliations in the state you call your domicile state. As in vehicle registration, driver’s license, owned property, if you have a business or LLC, doctor, dentist, bank, etc. Anything that ties you to another state can give that state the chance to try to claim you as a resident, and that can lead to fines and fees and miles of legal tape.

If you’re going to be working seasonal jobs like I am, that can also lead to some gray areas. Besides having to pay state tax on the hours you put in in the other state, (I’ll be paying income tax to Kansas for my time at Amazon) if you spend too much time working in a state that can also gives officials a reason to claim you as a resident. I’m not saying that it’s going to happen, it’s just a distinct possibility that young full-timers should be aware of.

Some states are worse about this than others, California being one example. I remember reading about a RVer who got pulled over by the police in the state, he’d been working there for a few months. The cop cited him for not having California tags on his vehicles and charged him a hefty late fine. He didn’t actually ‘live’ in the state, but because he’d been working there for X amount of time by state law he was a resident.

Stories like these worried me as a future full-timer and it’s something I’ll be keeping in the back of my mind as I head out next month. It’s impossible to keep track of the nuances of every state’s rules when it comes to residency, but I recommend checking a reliable RVing resource/forum for things like this before planning to spend a significant amount of time in a new state as a precaution.

* * *

And pictures are back, yay! I don’t have the iphone picture thing completely sorted out yet, but I’m getting there. Here I have a picture of the pvc pipe within my closet that was leaking. After getting up on the roof and caulking over all of the rivet heads it seems to be doing okay. So far. I guess we’ll see.

The other picture is myself in the pool here at Stoney Crest. This RV park may not have a lot of trees and the sites may be close together, but it has a nice and well maintained pool. Bonus points for being deep enough that I can’t stand up in it at one end – very few pools go deeper than 5 feet these days (this one goes to 8). Also: my previous post on pop riveting has now been updated with pictures of the process.

I have several days off in a row coming up, and have plans to do a big RV cleaning/purging this weekend and get the rest of the mail forwarding stuff set up. Expect more about that next week, less than one month to departure, woohoo!

**Edited on 8/19/12 to remove text related to spam, as it has been all fixed.**

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18 Responses to A Bit About Domicile State Selection

  1. Marvin August 16, 2012 at 7:10 am #


    Becky ,

    Florida , also has a grey area on license plates that is subjectively enforced according to the attitude of the officer . If you are employed in the state , you are required to have Florida vehicle plates and insurance coverage .

    • Becky August 16, 2012 at 8:57 pm #

      Yeah, I figured there were others besides just California. Think the best advice I heard on the subject was don’t offer up anything unless you are directly asked by an officer.

  2. cozygirl August 16, 2012 at 9:21 am #

    Well I got lost on the spam part…however do you know if your site is compromised? I wish hacks would just hack off O:(

    That domicile planning makes my head spin. That’s our chore this winter to figure out before next year and how sweet to find you have shared most of the work. Our biggest question is we want to stay within our PPO for the better health insurance coverage and that leaves MO or IL…neither I’d like to claim especially our not so great state of IL! I was hoping we could claim SD but still keep our doctors here and come back if we need work done on our bods and visit with the family especially all our grandbabies O:) Now I’m not sure we can do that. And we want to workamp as well…hummmm lots of questions about that too. Guess we have our work cut out soon to ask more and more questions…thanks to all the awesome bloggers and all the forums!

    PS – you are just so adorable…nice pool shot! Loving that red hair… :O) ~cozygirl

    • Becky August 16, 2012 at 9:09 pm #

      Basically the google search result for Interstellar Orchard has a link to my site as you would expect, but there is some spam in with it. The actual site itself doesn’t have any spam nor have I noticed anything else amiss. To be honest I don’t get it all myself either, I’m not an expert on website stuff or hacking. I’ll get it sorted out though.

      Yeah you could keep your doctors in IL, but that could potentially give IL a reason to still claim you as a resident so tread carefully. Maybe do a bit of searching on Illinois laws about such things? it probably wont’ be fun, but just think how great it’ll be once you’re on the road full-timing. That thought keeps me going when things get tough. 🙂 I’ll definitely still be spending time visiting my relatives up in Wisconsin once I’m on the road, that’s a great thing about traveling, you can be where you need to be.

      And thanks, although my hair isn’t actually red. It’s just got some red-ish highlights when the sun hits it a certain way. I just love love love the pool here, makes exercising easier too when it’s too hot to jog, I can swim laps.

      Good luck you guys! I’ve been peeking at your blog on occasion, seems like you’re making good progress. 🙂

  3. narda August 16, 2012 at 3:33 pm #

    So envy you! enjoying a free time at the pool!
    narda recently posted..Marion Jones Sells Tiny TX House … Buys Not-So-Tiny HouseMy Profile

    • Becky August 16, 2012 at 9:12 pm #

      That picture was actually taken a good few weeks ago, shortly after I bought my iphone. There hasn’t been much pool time lately with all the frantic running around to get stuff done. Pretty soon though this hard work will be paying off and I’ll be free to roam. 🙂

  4. Ross Macintosh August 17, 2012 at 6:16 am #

    Becky – I did a bit of research. You can be sure nobody figured out your admin password. The problem is with woo themes. Apparently they were severly hacked in April and the code of all woo themes was compromised, giving the hackers a backdoor into all blogs/websites using woo themes templates. The hackers can likely add ads etc to thousands of sites at the same time with just a few clicks of a mouse.

    If you go to the woo themes site and log in apparently there is a security patch to the “framework” that you need to install asap. They likely have info there once you log into their site. If there is a backup feature I’d imagine you’d should use it after you install the patch. It is likely important to replace any old (compromised) backup with a new clean one.

    Good Luck! — Ross
    Ross Macintosh recently posted..trailer pricing…My Profile

    • Becky August 18, 2012 at 11:53 pm #

      Voila! All fixed. You were right Ross, updating the framework did the trick. Thanks a million.

      Took me a bit to find the download on wootheme’s website. They didn’t exactly have an announcement saying ‘we’ve had a security breach, get the fix here!’ that would be bad for business I suppose. 😉

  5. Don J November 14, 2013 at 1:52 am #

    Becky, Great web site! We are planning to go full time in the next year or so and are leaning towards South Dakota for our domicile state. We live in California now but plan to do a lot of traveling. But with family in California will probably spend a fair amount of time here. Since retiring I’ve been working here as a contractor and will until we put away a little more money.

    We are putting our home up for sale and once it sells I will continue to work in California, but we were kind of planning to set up residence in South Dakota after the sale. But it sounds like this money grabbing state is set up to get around that if I’m working here. I guess I figured I’d have to pay income tax on what I earn working here, but I didn’t realize they would call it residency just because I’m working here.

    So the question is if you see much advantage in establishing a South Dakota residence in the near future before we pull out of the state for good.

    The second question is how much time can we expect to be able to visit friends in California before they will try to force the residency thing? Did you see any guidelines while you were doing your article?

    Thanks again for a great web site.

    -Don J

    • Becky November 14, 2013 at 4:41 pm #

      Heya Don, thanks for commenting and welcome to IO!

      I’m not a legal expert in any way shape or form, so please don’t take my advice too seriously. If you want more concrete advice, you might want to go to California’s DMV website and see for yourself exactly what the letter of the law says about residency or contact a law firm in California that has had experience dealing with these sorts of issues.

      That being said, here’s what I can find:
      This website has blurbs pulled right from each state’s laws regarding vehicle registration for all states, if you scroll down to California you’ll see:

      “A non-resident vehicle becomes subject to registration 20 days after gainful employment is accepted or residency is established, at which time application for registration must be made.”

      So by those words, as long as you’re working in Cali, you need to keep your vehicle registered there. As for visiting California and being considered a resident, that same page has this to say:

      “A non-resident vehicle must be registered in California if the vehicle is based in California or primarily used in California; a vehicle is considered to be primarily used in California if it is operated or located in the state for a greater amount of time than it is located or operated in any other jurisdiction.”

      So by those words, as long as you spend an equal amount of time not in California as you do in California, you should be okay. What the law doesn’t state is what time period their looking at. 6 months out of a year would be my guess (as long as you aren’t working there remember) but again I’m not a law expert.

      Hope this helps!

  6. John February 24, 2015 at 10:10 am #

    Hi Becky, I just found your site last night so I haven’t been all the way through it yet. I’m now in the planning stages of making a move similar to yours, but only 3 years from now. The difference being I’m planning on living out of my pickup and visiting every national forest in the lower 48, I believe there are 155. I’m tentatively planning on thus taking approximately 6 years and will spend the winter months somewhere warm

  7. John February 24, 2015 at 10:12 am #

    Cont. I saw earlier in the post about receiving mail, I can either have an address at a friends in Michigan or a relatives in Washington, but how would I get mail if I’m in say Alabama one day and Arkansas the next. Thank you

    • Becky February 24, 2015 at 12:55 pm #

      Heya John and welcome to IO!

      I use a mail forwarding company, which I explain in

      Basically that company forwards my mail to wherever I happen to be. Since I’m in one location for months at a time working, it’s pretty easy for me. If you’re going to be moving around a lot it gets a little more challenging. You’ll probably have your friend or relative forward your mail general delivery to the post office nearest the national forest you’re staying at. This means you will want to ask the post office ahead of time to make sure they take general delivery mail, and then you’ll stay in that area until the mail arrives. To make it easier, move to online billing and notifications as much as possible so reduce your reliance on paper mail.

      I hope this helps!

  8. Oystein June 11, 2015 at 2:12 pm #

    I live in California and will not being picking this state as a domicile. After reading your post I will choose Texas. Californian has high taxes all the way around and vehicle registration fees are very high. The county I live in, Santa Barbara, has an 8 percent sales tax. California is bueatiful, especial along the Central Coast, but you are paying for it.

    • Becky June 11, 2015 at 9:59 pm #

      Yeah Oystein everyone I’ve talked to in California has said it’s ridiculously expensive to live in.

      At the time I wrote this post, SD was the best (read: cheapest) choice for young fulll-timers, but with the Affordable Care Act going into effect this year all that’s changed. I suppose I should do an updated version of this post some day. 🙂

  9. Don J June 12, 2015 at 1:01 am #

    Becky, I’m curious about why the affordable care act affects choosing South Dakota as a domicile state? You did say that had something to do with younger full-timers, so that may not apply to us as I just started Medicare and my wife is a few years behind me, but I am curious. This thread has my post from a year and since then we have sold our home in California and are full time in our RV. We are staying long term in a very nice RV resort (Vines) in Paso Robles, CA. I’ll continue working for about another year while we are here and then hit the road. We are certainly going to get out of Taxifornia once I quit working. This state is tax crazy as Oystein from Santa Barbara has said. They are finding new reasons to tax people all the time. Last year they got through a law that let’s them add over $1 tax per gallon to gasoline sales. It used to be 18.2 cents and it was on a sticker on the pumps. They change it so fast that they quit putting up the stickers. Last one I saw said 39 cents a gallon, but I read somewhere that it is now nearly 50 cents.

    So in our search for a domicile state we visit with a lot of others who stay in our RV resort. In addition to the big three (Florida, Texas and South Dakota) we find Montana, Nevada and Oregon are being used. In Montana people form an LLC to save on taxes on their vehicles, Nevada seems to be very high on vehicle licensing fees and there were some drawbacks in Oregon too. Of the big three Florida is supposed expect you to be in the state about half the time, but people we spoke with said that they aren’t there that much and it doesn’t seem to be an issue. In Texas you may need to get a Class A drivers license. South Dakota only requires you to prove you were in the state for one night in the 6 months before you renew your drivers license. According to a web site there our rig should license for around $330 a year with NO smog requirement. In California it was around $800,

    I’m still studying, but South Dakota is still looking like a strong favorite. Would really be interested in seeing your re-evaluation of domicile states.

    -don j
    Don J recently posted..RV trip to Grand Canyon…err… Las Vegas, Pahrump and Calico Ghost TownMy Profile

    • Becky June 13, 2015 at 9:42 am #

      Don, you can read about the health insurance changes in SD here: http://www.interstellarorchard.com/2014/11/17/south-dakota-rver-health-insurance-changes/

      Being on Medicare though, this probably doesn’t affect you at all, it’s just for the pre-retirement age full-timers who can no longer get health insurance in SD that will cover them out of state. You can still poke at Kyle’s website I listed in that article to see how the Medicare options are like in SD. Hope this helps.

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