If you live in Minnesota for 183 days out of the year, then you're technically a full-time resident for tax purposes, the state Supreme Court ruled Wednesday in a decision that could affect many part-time residents.
In the case of Curtis and Stacy Marks, justices ruled 4-3 that the Minnetonka couple owe at least an additional $379,000 in taxes for 2007.
The Marks family moved from Florida to Minnesota in August 2007, but according to court documents Curtis Marks was physically in Minnesota for an additional 104 days before settling in permanently. This brings his presence in the state to a total of 257 days – or 70 percent of the year – although he claimed part-year residence status in his tax return.
Judges have ruled that his physical presence in Minnesota made the Marks family full-time residents for that year.
State law says a person can still claim residency elsewhere, but if they maintain an abode — residence with a kitchen and bathroom — and spend 183 days or more in the land of 10,000 lakes, then they owe a full year's worth of taxes.
The Star Tribune reports the Marks family owns a nearly $4 million home on Lake Minnetonka and were audited by the Department of Revenue in 2009.
Marks cofounded Verifications Inc., a Twin Cities background checking and drug testing business, and now runs a local software company, the paper adds.
Ruling could have big impact
One of the three judges against the decision, Justice David Stras, noted the Marks family didn’t buy a house in Minnesota until August 2007, and believes any days spent here prior to that shouldn’t count toward the 183-day calculation. He also argued the case is a policy issue and should be addressed by the state legislature.
According to MPR News, Stras said the court’s opinion may eliminate — or at least limit — part-year resident status for many eligible taxpayers.
The publication also said this case has been watched closely by the state’s most wealthy snowbirds and part-year residents because it could affect tens of thousands in tax dollars.
The Marks' attorney Barry Gersick believes the outcome of the case will impact many.
“I feel bad for my clients,” Gersick told the Star Tribune. “I’m not sure how the Department of Revenue will use this ruling moving forward, but it will definitely have an impact beyond our narrow case.”