Ohio’s Bright-Line Test for Nonresidency No Longer Final Say– July 15, 2015 by Karen Raghanti

In the recent Cunningham v. Testa, 2015-Ohio-2744, decision, the Ohio Supreme Court ruled that facts and circumstances still apply when determining if a taxpayer is an Ohio nonresident, in addition to the bright-line test. Until now, the bright-line test definitively qualified taxpayers as nonresidents if they maintained an abode outside of Ohio the entire year, did not spend more than 182 days in Ohio (212 days beginning in 2015) during the tax year and timely filed an affidavit of nonresidency.

In Cunningham, the Tax Commissioner agreed that Mr. Cunningham met the Ohio bright-line test to be deemed a nonresident. The Board of Tax Appeals ruled this was enough to prove Mr. Cunningham’s Ohio nonresidency. However, the Tax Commissioner appealed this decision to the Ohio Supreme Court arguing that when Mr. Cunningham signed the affidavit of nonresidency, he made a false statement.

The Tax Commissioner argued that Mr. Cunningham was indeed an Ohio resident when he:

  • Signed an affidavit, under penalties of perjury, during the tax year that his principal residence was in Ohio to qualify for the homestead exemption.
  • Listed his Ohio address on tax returns.
  • Maintained an Ohio driver’s license.
  • Voted in Ohio during the tax year.
  • Had his utility bills for his second home in Tennessee sent to his Ohio address.
  • Was born, raised and educated in Ohio (as was his spouse), and raised his family in Ohio as well.

The Ohio Supreme Court agreed with the Tax Commissioner. As a result, taxpayers can no longer rely solely on the bright-line test to verify their Ohio nonresidency. Taxpayers must ensure they also meet the more fact-intensive common law tests.

If you have previously taken the position you are an Ohio nonresident, please contact a member of your tax service team to discuss how this Ohio Supreme Court decision may impact you or contact Karen Raghanti at kraghanti@cohencpa.com.


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