Buying a Florida Residence Does Not Make Someone a Florida Resident

An attorney outside of Florida called me about his clients’ plan to protect assets by purchasing a home in Florida. The attorney anticipated that a judgment may be entered against the client within the next few months. The client owned and operated a real estate construction business in Arizona. Arizona is a community property state which has no tenants by entireties ownership for husband and wife. The attorney proposed that the client buy a house in Florida jointly with his wife after which he could protect the house and jointly owned financial assets, and most importantly, his construction business, as tenants by entireties property. The client would obtain a Florida drivers license and voter card.

I told the attorney that the house may be a protected tenants by entireties asset but that this judgment debtor could not protect his jointly owned personal property under the tenancy by entireties immunity.

This issue has been previously addressed on this Blog but warrants repetition. Exemption law for real property is generally based on the jurisdiction where the property is located. In this example, the jointly owned Florida residence would be deemed an entireties asset owned by non-residents. Exemption of personal property- property other than real estate- is based on the laws of the debtor’s residence. Purchasing a Florida residence is not the same as one being a Florida resident. Even though this prospective debtor would have a house, a drivers license, and voters registration in Florida there were not enough other facts that would make him a Florida resident eligible for protection of his personal property under Florida’s laws.

The debtor had no plans to abandon his primary business in his home state. He planned to have his children go to school in his home state, he would spend most of the work week in his home state at his company, his marital furniture would remain where it is, and he would receive most of his mail at his present address. A person is a Florida resident if his Florida residence is his primary residence, in other words, his “family home.” Purchase of a Florida property with not permanently moving to Florida is not a viable asset protection plan.

posted by Jonathan Alper, asset protection and bankruptcy attorney, Orlando, Florida