Home Is Where The Taxes Are, Court Says

It’s where you live that counts - at least for tax purposes - the Idaho Supreme Court says.

The court on Wednesday unanimously rejected an appeal from a couple, holding that when they received a $63,450 termination payment, they were residents of Idaho and thus subject to state income tax.

William and Joy Pratt contended when they received the payment on May 3, 1991, they should have been considered residents of Clarkston, Wash., because that was where they intended to live.

But the Supreme Court agreed with the Idaho Tax Commission, which held that the termination payment was taxable in Idaho.

The Pratts said they traveled to Clarkston in March and April of that year, seeking suitable housing, but did not move into a leased home until May 31.

The Supreme Court said for a change of domicile to occur, a person must be physically present at the new site with the intention of making that his or her home.