On a glorious fall weekend, with resplendent colors and a warm sun taking the edge off crisp, cool air, I set out to play golf, as I do most Sundays from spring to fall, with my friends at a club on the North Fork. On this mid-October day, the golf course was empty.
We wondered why there were no players pushing ahead of us on such a beautiful morning.
One friend said he was at the transfer station near his home earlier in the morning, and a man told him, “I’m outta here — time to go to Florida.” He drove off, his Florida plates fastened to his car.
My other friend said a wealthy man he knows was leaving on his private plane to Florida this week.
Why are they departing these parts so early? we wondered.
Then it dawned on us.
There are growing number of well-off people who have declared residence in Florida to avoid taxes in New York State, New York City and Suffolk County. They are forced to spend time in the Sunshine State and other tax havens for six months and a day. This is especially true of older people who may be retired, living off fixed income or working less.
As someone who pays a heavy tax load to live here, it is unsettling for me to see these folks enjoying our beautiful beaches, visiting wineries, playing golf and being out on our pristine waterways for six months of the year, and not contributing their fair share of taxes. We are being abandoned for half the year plus one day as the tax base shrinks.
These itinerant New Yorkers are also taking advantage of living in New York City part time yet reveling in all the city has to offer. They are seeing Broadway shows, visiting museums and chilling in Central Park, but leaving us in the lurch when it comes to helping people less fortunate than they.
New York localities are losing billions of dollars in funds for fighting crime, educating our kids, picking up garbage, improving mass transportation and funding services. It is only fair that one should pay something if you enjoy life here for six months.
According to recent U.S. Census data, some 319,020 residents fled New York State between July 2020 and July 2021, a 1.6 percent year-over-year loss that made New York the nation’s leading state for population decline. The subsequent loss in revenue for the Empire State is $19.8 billion.
The early snowbirds who go away even while the leaves are still on the trees are taking their enforced hiatus earlier than ever to take advantage of the six months-and-a-day rule.
And they are missing some of the best time of the year here: the glorious Northeastern fall colors and crisp weather. They won’t be apple and pumpkin picking at our beautiful farms. And they are gone for Thanksgiving. They can’t experience the lighting of the tree in Rockefeller Center and enjoy ornate Christmas department store windows. Will they be in Times Square for New Year’s Eve? Never, but more significantly, they are depriving residents, many poorer than they, of much needed tax revenues.
State tax collectors and wealthy New Yorkers who are moving to Florida are increasingly at odds, and the state is going all out to catch the tax avoiders.
Recent federal tax laws limiting the deduction of state and local income taxes have created even more incentives for wealthy New Yorkers to move to Florida. Many liberal politicians who bellowed “tax the rich!” did just that, and the rich left for lower-tax states.
But it is not all sun and fun for many people who are dodging the tax man. To enjoy the best of both worlds, they are not being able to come and go as they want. They pay a price.
Their movements are restricted. They are almost under a glorious house arrest in their adopted homes, counting the days until they can move freely. Sneaking back without leaving a trace to see the family is not fun.
Some accountants have said the chance of being audited for this enforced lack of movement is almost 100 percent.
In addition to the traditional methods the state uses to make sure a taxpayer isn’t gaming the system — like checking taxpayer’s credit card bills and travel schedules — New York officials are tracking cellphone records, social media feeds, and veterinary and dentist records.
Officials are checking pieds-a-terre in New York to make sure refrigerators and closets are being used, making sure taxpayers are not residing there full time.
To save some 4 to 9 percent in taxes has become almost a full-time pursuit for the six months-and-a-day-ers, using apps and other means which track how they are complying. The whole process is a difficult and painful hassle for the dodgers.
One solution would be reforming our tax laws so that people are not strangled by insanely high tax rates. Give these folks reason to stay and enjoy all we have to offer while chipping in a fairer share of taxes. Then their other trips out of state can be a choice and not a sentence.
Five decades ago, Beatle George Harrison presciently wrote in the song “Taxman,” “Let me tell you how it will be/there’s one for you, 19 for me.”
We must make the share so that what the tax man takes in New York State is less onerous and give people incentive to stay here and stop living by an artificial clock.
Both groups need a win. The middle class should benefit from a more robust tax base, and those who have the means should be able to come and go freely as the founding fathers intended.
Let’s get some of that $19.8 billion back.
Edward Adler is a partner at a global strategic communications firm. He lives in the Hamptons and New York City.
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