A well-to-do New York couple's dream of retiring to the sunny climes of Florida has ended in a costly tax dispute, after officials determined they never truly severed their ties to the Empire State. John Hoff and his wife, Kathleen Ocorr-Hoff, have been ordered to pay nearly $60,000 in back taxes, plus penalties and interest, following a ruling by a New York state tax appeals tribunal.
The Failed Florida Retirement Plan
The couple, who had planned a classic 'snowbird' transition to escape northeastern winters, purchased a luxury condominium in Naples, Florida, in July 2014. They paid $935,000 for the 2,560-square-foot property on Gulf Shore Boulevard, later investing over $200,000 in renovations. By 2023, the home was valued at approximately $1.6 million.
John Hoff, the former president of Farmington-based technology services firm Global Point Technology, testified that he and his wife began discussing making Florida their primary residence around 2016 and 2017. The move was part of his retirement strategy, which included an 'exit strategy' from his company. However, this plan was disrupted in June 2018 when his son's planned takeover of the business fell apart due to tariffs imposed on Chinese products.
Significant Ties That Bound Them to New York
Despite their Florida ambitions, the tax tribunal found the couple maintained substantial connections to New York. A critical factor was their continued full memberships at two prestigious New York country clubs: the Oak Hill Country Club in Rochester and the Canandaigua Country Club. Although they joined The Country Club of Naples around 2018, they retained their original memberships.
Furthermore, an analysis of their time spent in each location proved damning. Court filings revealed that in 2018, the Hoffs spent 186 days in New York, compared to only 131 in Florida. In 2019, the split was 164 days in New York versus 153.5 in Florida.
Kathleen Ocorr-Hoff, a graphic designer, stated she continued her work after moving to Florida. However, the tribunal noted she did not provide sufficient proof of establishing a new business in the state, and her tax returns indicated she was still working out of New York. Hoff, meanwhile, continued to receive a 'significant salary' and travelled for the company.
A Tribunal's Verdict and a Costly Lesson
In April 2021, New York tax authorities informed the couple they owed $59,648 in back taxes for 2018 and 2019. The Hoffs appealed, but the decision was upheld in a tribunal ruling signed on October 9. The tribunal dismissed their arguments about changing voter registrations and driver licences to Florida, describing such 'informal declarations' as having 'lost their importance in recent years' due to their 'self-serving nature'.
The ruling stated that what truly mattered was a 'comparison of homes, business and social ties and the amount of time spent in each place'. The tribunal concluded the couple had only shown an 'undisputed trend toward eventually relocating to Florida' while failing to demonstrate they had fully left New York behind.
This case serves as a stark warning for high-net-worth individuals seeking to establish residency in low-tax states like Florida. It underscores that tax authorities will scrutinise not just legal documents, but the practical reality of where one's life, work, and social commitments are centred.
