It seems that Kansas should return $43 million in revenue tax plus curiosity to Gene Bicknell after a latest choice of the Supreme Court docket of The State of Kansas. That is the best stake residence/domicile case I can recall. It’s fairly dramatic. In 2021 Kansas collected $4.6 billion in particular person revenue tax, so it’s like they must pay almost 1% of it again to only one man. The problem was whether or not Mr. Bicknell was a Kansas resident in 2005 and 2006. In 2006 he bought his curiosity in NPC Worldwide, Inc to Merrill Lynch International Personal Fairness. At the moment NPC was the biggest Pizza Hut franchisee with 790 shops in 26 states.

I lined the case in 2014. It has a tortured procedural historical past which I’m not going to evaluation. Mr. Bicknell received, however given the backwards and forwards, it was in all probability not an inevitable victory. As a substitute I’ll have a look at a number of the points that arose which may effectively be related in circumstances of way more modest quantities, however first somewhat little bit of background.

The Mystical Idea Of Domicile

When enthusiastic about what your state of residence is for revenue tax functions, there’s a tendency to concentrate on issues like driver’s license, voter registration and counting days. Do not get me mistaken. These primary type of issues could be crucial, however they will not be determinative. You’ll usually be thought-about a resident of the state the place you’ve got your domicile. And domicile can generally seem to be an nearly mystical idea. It’s the place that you just think about to be your everlasting dwelling, however there may be an odd level.

Everyone has a domicile and even in case you determine that you’re not going to ever return to your domicile, it stays your domicile till you determine a brand new one. And within the onerous circumstances, all kinds of issues could be seen as related in figuring out what your true domicile is. A marketing consultant on the problem as soon as informed me that it’s the place you’ve got the household photos.

Personally, I believe that if you find yourself coping with comparatively affluent individuals who would possibly personal houses in a number of states, the idea of domicile is sort of dated, nevertheless it persists.

Can Nonseparated Spouses Have Totally different Domiciles ?

One of many points complicating the case was that Rita Bicknell continued to assert Kansas residency via 2007, whereas Gene had made the change in 2003.

Rita defined she didn’t instantly declare Florida residency then as a result of she was not prepared to finish her involvement with sure skilled, political, and charitable actions in Kansas. However she testified that she nonetheless spent most of her time in Florida between 2003 and 2008.

There’s a presumption {that a} married couple share the identical domicile. This ended up creating a reasonably advanced evidentiary argument within the courts. There had been a really shut examination of Gene’s Florida domicile however not a lot of Rita’s declare of continued Kansas domicile. So Gene was not required to show that he had a special domicile than Rita’s.

Regardless that, the Bicknells received. the lesson right here might be not to do that at dwelling. If you wish to win the state revenue tax, your partner could have to surrender the varsity board seat or no matter it is likely to be that desires them to carry onto the outdated domicile.

Pay Consideration To That Questionnaire

Firstly of the audit Kansas Division of Income (KDOR) despatched out a questionnaire that amongst different issues requested what number of days Gene was in Kansas versus Florida. The reply was 111 days in every in 2004, 113 days in Kansas and 117 in Florida in 2005 and 111 in Kansas and 134 Florida in 2006. This didn’t look a lot like having deserted Kansas for Florida.

It turned out that the questionnaire had been dealt with by a senior wealth advisor who had a crew reconstruct the times from info that they had accessible. Gene was capable of set up that he had not likely paid any consideration to it and had his assistant signal it. At trial Gene testified that he did not common greater than 30 days per yr in Kansas in 2005 and 2006. Buddies, household and colleagues corroborated this declare.

Taking that at face worth I’ve to marvel in regards to the communication with the wealth adviser. Having these days be so shut ought to have set off alarm bells given the stakes concerned. On the very least the questionnaire ought to have had enter from attorneys. Somebody ought to have requested Gene in regards to the day depend earlier than making that sort of damaging admission, which apparently was not true.

Actually Take into account Getting Rid Of The Previous Home

One other matter that brought on a variety of concern was sustaining possession of the home in Pittsburg Kansas.

Whereas there was no particular proof in regards to the worth of the Bicknells’ Pittsburg home, the district court docket discovered their Florida home was bigger and certain way more beneficial.

KDOR had a counter argument to that

In difficult the district court docket findings, KDOR argues the worth of the Bicknells’ Florida home was principally attributable to the land and never the home itself.

It ended up not sinking the case for the Bicknells, nevertheless it certain didn’t assist.

Nice Consequence For The Bicknells

KDOR fought onerous, however Bicknell’s crew lastly prevailed. Even church membership entered into the case, as they maintained their membership in a Kansas church for just a few years whereas in search of simply the best one in Florida. Bicknell’s celeb and the excessive stakes meant that there was a great little bit of protection on the choice. Jonathan Shorman of The Kansas Metropolis Star famous a number of the extra colourful moments:

At occasions, the lawsuits took weird turns. In a single court docket submitting, Bicknell mentioned KDOR cited that he had visited household and pals in Crawford County, owned property there, put in a swingset at his Pittsburg home for his grandchildren and allowed a farm cat named Checkers to stay on the home as proof he hadn’t left Kansas for Florida.

Shorman famous that Kansas will be capable of deal with the fee because it has a $3 billion surplus. You possibly can hear Bicnknell’s commentary right here.