Defining Residence for Income Tax Purposes: Domicile as Gap-Filler, Citizenship as Proxy and Gap-Filler

29 Pages Posted: 22 Jan 2016

See all articles by Edward A. Zelinsky

Edward A. Zelinsky

Yeshiva University - Benjamin N. Cardozo School of Law

Date Written: January 22, 2016

Abstract

The states' income tax systems are important repositories of experience which confirm the administrative benefits of citizenship-based taxation. Domicile today plays an important role in state tax systems as a gap-filler when more objective statutory residence laws fail to assign any state of residence to the taxpayer. Citizenship is an administrable proxy for domicile and serves a similar gap-filling role in the federal taxation of individuals whose income and activities straddle across national boundaries.

The states' difficulties enforcing domicile-based taxation highlight the administrative benefits of citizenship-based taxation. As long as residence is understood for tax purposes in terms of domicile, citizenship is an efficient proxy for such domicile. The states' experience defining residence supports the United States' citizenship-based approach to federal income taxation. Under the Internal Revenue Code, citizenship serves as an administrable proxy for domicile and fulfills the same gap-filling function played by domicile under the states' income taxes.

Keywords: citizenship-based taxation, residence-based taxation, statutory residence, domicile, source-based taxation

JEL Classification: K33, K34

Suggested Citation

Zelinsky, Edward A., Defining Residence for Income Tax Purposes: Domicile as Gap-Filler, Citizenship as Proxy and Gap-Filler (January 22, 2016). Michigan Journal of International Law, Vol. 37, 2016, Cardozo Legal Studies Research Paper No. 476, Available at SSRN: https://ssrn.com/abstract=2720254

Edward A. Zelinsky (Contact Author)

Yeshiva University - Benjamin N. Cardozo School of Law ( email )

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