How We Became Residents of Texas
We just spent 38 days in Texas, the longest time we have spent in any state since our journey began earlier this year. The main reason was to be in Austin for the Formula 1 race. We also got the chance to stay in some great state parks, meet old friends and family and make some new acquaintances along the way. We also took the chance while in Texas to become residents of the state. In this post I'll explain why we chose Texas and the process involved to make Texas our domicile.
When you travel full time, you can't just be a citizen of the world! As romantic as it sounds to be of "no fixed abode", practically it just isn't possible. For numerous legal reasons you need a home base. Most notably you need an address that can be used on tax returns, if you want to vote you need an address and you will need to be a resident of a state to buy medical insurance on the ACA healthcare exchange among numerous other reasons.
Most nomads chose one of three states for domicile, South Dakota, Texas or Florida. Technomadia have an excellent section on their website about domicile, so I won't rehash the content. We considered all three and chose Texas for a few reasons:
1 . Healthcare - We pay for our own healthcare and some states are friendlier to fulltime RVers than others. In South Dakota it has recently become more difficult to get healthcare as the insurers have added a strict residency requirement in order to qualify for their programs. That ruled out South Dakota for us. Texas and Florida have many more insurance options and most plans don't seem to have residency requirements.
2. Convenience of being an "Escapee" - We are not usually people who join groups but many full time RVers recommended Escapees as a great "friend" to have on the road. I am impressed by their advocacy of this lifestyle, and their customer service is excellent. After recommendations from several friends we decided to sign up and get a Texas address with them to use their mail forwarding service. At first glance the mail forwarding service was not as convenient as Traveling Mailbox which we had been using since June. However, Escapees is more cost effective and they are in the process of modernizing the service to provide an expanded mail scanning service. Since the benefits outweighed the downsides, we joined the thousands of other RVers who now claim Rainbow Drive as their home.
3. Low tax base - We no longer have any ties to California, having sold our property there earlier this year, and ended our employment in the state. I am a liberal and believe in paying taxes. In fact we contributed happily into Federal, California and Local County coffers when we were earning large incomes. Since we are now living on less it made sense for us to look at every way we could manage our expenses. A benefit of Texas as our home is the lack of state income tax which helps us stretch our reduced taxable income a little further. Another noteworthy saving for us is vehicle registration fees. Both our truck and travel trailer costs will be reduced by around 85% compared to California. These savings go a long way in contributing towards our regular camping costs.
4. Central location - If for any reason we had to be in our home state Texas is very accessible, easily reached from where anywhere we plan to spend most of our time. The same isn't true for Florida or South Dakota.
The process of becoming a resident of Texas:
Here are the steps we went through. As we are not experts, please take our experience as just that, our experience. Make sure you seek expert advice.
- Join Escapees - We took their basic level membership which is on special at the moment for $29.95 a year. We paid the additional fee for their mail forwarding service which automatically gives you an address in Texas. Cost is $95 - $135 a year depending on the service you choose. Note they also offer this service with a Florida or a South Dakota address. This gave us what we needed for the rest of the process, a legal address in Texas.
- Change of Address - Update your address with your bank, credit card company, cell phone provider, auto loan or any other financial institution. A recent bill from any of these showing your new address will be needed to prove Texas residency when you apply for your driver licence.
- Vehicle Registration - We obtained the required forms on line from the Texas DMV, completed them and mailed the paperwork with accompanying checks to the local county tax office for our new address. We did this out of state so the required vehicle inspection was waived until the vehicles were physically in Texas.
- Vehicle inspection - As soon as they are in state you are required to have your vehicles (in our case truck and travel trailer) inspected. Finding an inspection site is easy, they are everywhere. After a Google search we found three options in the small town near where we were camping at the time. In our case, we pulled up without an appointment with our trailer in tow. The inspection took about 10 minutes in total. Essentially the technician checked that all of our lights were operational and the tires had enough tread. We didn't need to unhitch.
- Auto Insurance - Update your insurance policies for Texas. Our California policies were not transferable so we simply cancelled them and started anew with our Texas address. We received prorated refunds on our cancelled California policies and, as a bonus, found the Texas pricing to be a little less expensive.
- Driver Licenses - In Texas, the Department of Public Safety issue driver licenses and IDs. This was new for us, in California it is the DMV. You can only get a driver license in person. There are several requirements before they can issues your licence. You must have all of the following documentation with you when you visit the office.
- A current out of state driver licence
- Your Social Security Card
- Two documents confirming your new Texas Address - In our case we used a credit card statement and our auto registration but there are many more choices. Printed copies of on-line bills seem to be acceptable as long as your Texas address is shown
- Proof of Texas Auto Registration
- Proof of Texas based Auto Insurance
Unfinished Business. Next steps for us:
- We need to update our Estate Plan to reflect our new address. Since our previous attorney is not licensed in Texas, we need to find a new one in the Livingston area.
- Choose a new healthcare plan as Texas Residents beginning January 1st. The timing is perfect since open enrollment for ACA plans 2015 began on November 15th. We have had excellent advice from Kyle at RVer Health Insurance who specialize in policies for those RVing full time.
A few things to consider if you chose Texas as your domicile:
- Professional Services: If you use the services of a financial adviser, attorney, tax accountant etc, they may not be licensed in your new state of residence and no longer able to work with you. Check with them before you make any major decisions.
- Healthcare: If you are below retirement age, not covered by an employer or VA plan then this will be a big determinant of your domicile state. Research your options carefully before making and decisions. Nina of Wheeling It has an excellent post on the subject.
- Because you have to apply in person for your driving license you must have plans to be in Texas at some point to complete the process. You can't do it all remotely.
So we now have our new Texas license plates and have to wait for our driving licenses in the mail. The true test of whether we have successfully changed our domicile however will be when California no longer considers us residents. To know that, will take some time.