Snowbird Jeter May Owe New York Millions

Nov. 16, 2007 — -- The phrase "home is where the heart is" has never meant more to New York Yankee Derek Jeter, who is going to have to prove whether his home in Florida or his apartment in Manhattan is his primary residence.

If it's the Tampa, Fla., home then Jeter is in the clear, and doesn't owe the likely hundreds of thousands of dollars -- maybe even millions -- in back taxes that the New York State Division of Tax Appeals is demanding.

According to documents obtained by ABCNEWS.com, the state of New York and New York City want Jeter to pony up income taxes, with interest, for the years 2001 to 2003.

The state is disputing Jeter's claims that his primary residence is -- and always has been -- in Florida, where there is no personal income tax and even a homestead exemption, which decreases homeowners' property taxes.

New York argues that Jeter keeps "items near and dear in his New York apartment" and has become "immersed in the New York community," which, under state law, could be enough to prove that Jeter's primary residence is actually in Manhattan.

For the time being, Jeter is paying taxes as a nonresident, which means he's paying taxes on approximately half his annual income. Should New York succeed in proving that Jeter actually is a permanent resident of New York, the Yankee will have to pay more state taxes as well as the additional New York City taxes.

Calls made to Jeter's representatives were not immediately returned.

The lifestyles of snowbirds is not uncommon, said several certified public accountants, who told ABCNEWS.com that many clients own a home in the northeast and another in a warmer climates like Florida. They also say New York is notorious for being tough on people who try to slip away tax-free.

"It's reasonably common [for people to escape to Florida]," said Daniel A. Weiss, a principle at the law firm of Tannebaum Weiss in Miami. "There's no personal income tax in Florida, and what that means is that we get a lot of people who retire here."

Every state has certain laws and statutes that determine what qualifies someone to be considered a primary resident, explained Weiss.

"A permanent residence in Florida is the place to which no matter where else you travel or how much you spend elsewhere you have the intent to return to," said Weiss. "For example, as far as Florida is required, even though you may work during the week in New York or spend more than half of the year in New York you still have the possibility of maintaining your permanent residency in Florida."