ORDERS:
FINAL ORDER AND DECISION
STATEMENT OF THE CASE
The above-captioned matter comes before this tribunal pursuant to S.C. Code Ann. § 12-60-2560(C) (2000) and S.C. Code Ann. §§ 1-23-310 et seq. (1986 & Supp. 2003) for a contested case
hearing. Petitioner F. Abbott Brown (Taxpayer) contends that he was entitled to the 4% legal
residence assessment for his residence located at 27 Greensward Road on Kiawah Island in
Charleston County, South Carolina, for tax year 2000. Based upon this contention, Taxpayer seeks
a refund of property taxes he overpaid in 2000, because his property was assessed at the default 6%
rate, rather than at the 4% legal residence assessment ratio. Respondent Charleston County Assessor
(Assessor) denied Taxpayer’s request for a refund, finding that Taxpayer failed to provide sufficient
proof that he was domiciled at the Kiawah Island residence during 2000 so as to qualify for the 4%
ratio. The Charleston County Board of Assessment Appeals (Board) affirmed the Assessor’s
decision, and Taxpayer now seeks review by this tribunal.
After timely notice to the parties, a hearing of this matter was held on May 13, 2004, at the
Administrative Law Court in Columbia, South Carolina. Based upon the testimony and evidence
presented at that hearing, I find that, because Taxpayer was domiciled at his Kiawah Island residence
in 2000, he qualified for the 4% legal residence assessment ratio for that property for tax year 2000.
Therefore, I further find that Taxpayer is entitled to a refund of the property taxes he overpaid in
2000 because his property was assessed at the higher default assessment ratio of 6%.
FINDINGS OF FACT
Having carefully considered all testimony, exhibits, and arguments presented at the hearing
of this matter, and taking into account the credibility and accuracy of the evidence, I make the
following Findings of Fact by a preponderance of the evidence:
1.Taxpayer purchased the property located at 27 Greensward Road on Kiawah Island,
South Carolina, jointly with his wife in 1997 while a resident of Ohio. Despite the purchase of the
Kiawah residence, Taxpayer continued to be domiciled with his wife in Ohio between 1997 and
1999.
2.In late 1999, Taxpayer and his wife separated, at which time Taxpayer moved out of
the marital home in Ohio and moved into the Kiawah Island home with the intent of making it his
permanent residence. Upon moving to the Kiawah residence, Taxpayer joined a local social club,
established a local bank account, and generally made the home the center of his business and social
activities. At the time he moved to Kiawah, Taxpayer did not own any homes other than the Kiawah
Island residence and the residence in Ohio occupied by his wife, and did not have any other living
accommodations. Having retired in 1998, Taxpayer moved to Kiawah Island with the intention of
establishing permanent residence at his home there.
3.Taxpayer formally separated from his wife in 2000. However, because vehicle
ownership and insurance matters were entangled in the divorce proceedings, Taxpayer did not
register a vehicle, obtain a driver’s license, or register to vote in South Carolina during 2000.
Accordingly, Taxpayer had an Ohio vehicle registration, driver’s license, and voter registration
during 1999 and 2000.
Taxpayer did file an income tax return in South Carolina for the year 2000.
While the return included a nonresident schedule because of his wife’s residency in Ohio, that
schedule clearly listed Taxpayer as having resided in South Carolina for the entire 2000 calendar
year.
4.In 2001, Taxpayer was able to, and did, register his vehicle, obtain a driver’s license,
and register to vote in South Carolina, and, in 2002, Taxpayer’s divorce became final, giving him
sole ownership of the Kiawah residence.
5.Based upon this evidence regarding Taxpayer’s actual residence and domiciliary
intent during 2000, I find that Taxpayer owned, resided in, and maintained his domicile at his home
at 27 Greensward Road, Kiawah Island, South Carolina, during the 2000 tax year.
CONCLUSIONS OF LAW
Based upon the foregoing Findings of Fact, I conclude the following as a matter of law:
The sole question presented in this matter is whether Taxpayer was domiciled at his Kiawah
Island home during the 2000 tax year. S.C. Code Ann. § 12-43-220(c) allows a property, when
occupied by the owner of the property as his or her legal residence (i.e., domicile), to be taxed on an
assessment equal to 4% of the fair market value of the property, rather than at the 6% default rate
set out in Section 12-43-220(e). See S.C. Code Ann. § 12-43-220(c)(1) (Supp. 2003), § 12-43-220(e) (2000). In order “[t]o qualify for the special tax assessment ratio allowed by this item, the
owner-occupant must have actually owned and occupied the residence as his legal residence during
the applicable tax year and been domiciled at that address for some period during the applicable tax
year.” S.C. Code Ann. § 12-43-220(c)(2)(i) (Supp. 2003) (emphasis added).
In the case at hand,
there is no dispute that Taxpayer owned the Kiawah Island property in 2000,
or that Taxpayer
occupied the property for “some period” during the year 2000.
Rather, the only question at issue
is whether Taxpayer established his legal residence, or domicile, at the Kiawah home while
occupying the property in 2000. See S.C. Code Ann. § 12-43-220(c)(1) (“For purposes of the
assessment ratio allowed pursuant to this item, a residence does not qualify as a legal residence
unless the residence is determined to be the domicile of the owner-applicant.”); see also S.C. Code
Ann. § 12-43-220(c)(3) (providing that, in making a refund claim, “[t]he taxpayer must establish that
the property in question was in fact his legal residence and where he was domiciled”).
Taxpayer bears the burden of proving that he established his domicile at the Kiawah Island
residence in 2000. As Section 12-43-220(c) makes clear, “the burden of proof for eligibility for the
four percent assessment ratio is on the owner-occupant,” who must “provide [the] proof the assessor
requires,” including South Carolina income tax returns and South Carolina motor vehicle
registrations S.C. Code Ann. § 12-43-220(c)(2)(iv) (2000); see also S.C. Code Ann. § 12-43-220(c)(3) (“The taxpayer must establish that the property in question was in fact his legal residence
and where he was domiciled.”) (emphasis added). Further, South Carolina courts have consistently
held that, in tax exemption matters, such as the legal residence exemption from the default 6%
assessment ratio, “[t]he burden is on claimants to prove their rights to an exemption by bringing
themselves clearly within the conditions imposed by the statute.” TNS Mills, Inc. v. S.C. Dep’t of
Revenue, 331 S.C. 611, 618, 503 S.E.2d 471, 475 (1998); see also York County Fair Ass’n v. S.C.
Tax Comm’n, 249 S.C. 337, 341, 154 S.E.2d 361, 363 (1967). Here, the Assessor argues that
Taxpayer failed to meet this burden because, among other things, he did not register a vehicle,
register to vote, or obtain a driver’s license in South Carolina in 2000 and because his 2000 South
Carolina income tax return contained a non-resident schedule, listed an Ohio mailing address, and
was prepared by an Ohio accountant. Taxpayer contends that he was, in fact, domiciled in South
Carolina in 2000, regardless of whether he obtained certain South Carolina documents, such as a
motor vehicle registration or a voter registration card.
I find that Taxpayer has met his burden. “The term ‘domicile’ means the place where a
person has his true, fixed and permanent home and principal establishment, to which he has,
whenever he is absent, an intention of returning.” Gasque v. Gasque, 246 S.C. 423, 426, 143 S.E.2d
811, 812 (1965). “The true basis and foundation of domicile is the intention, the quo animo, of
residence,” id., and, accordingly, “[t]he question of domicile is largely one of intent to be determined
under the facts and circumstances of each case.” Id. at 427, 143 S.E.2d at 812. In the instant matter,
Taxpayer has demonstrated that, upon separating from his wife in Ohio in late 1999, he moved to
the Kiawah home with the intent of making it his true, fixed, and permanent home and principal
establishment. And, since that time, he has resided in and maintained his domicile at the Kiawah
home. During this period, Taxpayer did not maintain any other residences, excluding the marital
home in Ohio occupied by his wife, and did not evince a domiciliary intent toward any location other
than his residence on Kiawah Island.
In denying Taxpayer’s refund request, the Assessor relied too heavily upon Taxpayer’s lack
of certain documents. While Section 12-43-220(c)(2)(iv) sets forth a list of factors to be considered
by the Assessor as proof of eligibility for the 4% assessment ratio, including the applicant’s South
Carolina income tax returns and South Carolina motor vehicle registrations, this list is not exhaustive
and these factors are not necessarily dispositive of the question of domicile. As noted above, the true
test of domicile is the intent of the putative domiciliary, not any particular set of documents. And,
while the existence of certain documents can provide some indication of the domiciliary intentions
of an individual, the lack of those documents need not necessarily indicate a lack of domiciliary
intent. A life-long South Carolina resident who chooses not to drive or vote might not obtain a
driver’s license or voter registration, but would still certainly be considered a domiciliary of South
Carolina. Similarly, even though Taxpayer’s separation and divorce proceedings limited his ability
to secure certain documentation indicating residence in South Carolina until 2001, Taxpayer
established his domicile in South Carolina in 1999 by moving to his Kiawah home with the intent
to make it his permanent residence.
ORDER
Based upon the Findings of Fact and Conclusions of Law stated above,
IT IS HEREBY ORDERED that the Charleston County Assessor shall refund to Taxpayer
the amount of property tax he overpaid on his home at 27 Greensward Road on Kiawah Island, South
Carolina, for tax year 2000, because the property was assessed at the default 6% assessment ratio,
rather than the 4% legal residence assessment ratio provided for in Section 12-43-220(c).
AND IT IS SO ORDERED.
______________________________
JOHN D. GEATHERS
Administrative Law Judge
June 16, 2004
Columbia, South Carolina |
