W-2G form

[user17714782655]

i have been working on the state section of my taxes for the last hour and a half and i have been trying to find an answer. in my federal i claimed the earnings in the state i won in and input the form as well. On my form from the state of missouri they have the won earning AND the paid amount to(being one with reported winnings and what they actually paid out to me). when they paid me out they pulled the taxes from my winnings already(federal and state taxes). when i then file the state return in Missouri it's adding in my current residential gross income as Missouri gross income as well as the other items under with the Missouri source income(ie.my winnings) so its coming off that i owe taxes to Missouri but i've already paid the taxes. i dont understand how i can input both the residental and non-residental without paying tax again but also not getting in trouble with the IRS. 

[AmyC]

Look at your MO-1040, line 27 to find the percentage of your MO income that is actually being taxed. This is what MO does:

1. It looks like MO is taxing all of your income. 
   1. MO does look at the total you earned everywhere to calculate your total income  
   2. MO does calculate tax you on the full amount. 
2. MO determines how much of your income was actually from MO to determine your % from MO.
3. The %MO income is multiplied by the MO tax on your full income to determine your non-resident portion.

When you were gambling, they withheld a standard amount. Higher overall income increases the tax due so that you can have a balance due.

[user17714782655]

I’m sorry, I don’t think I posted that more clearly. Or I may not be fully understanding. I live in Ohio and visited MO and had gambling winnings there. The only form I have from MO is the W-2G to which I entered in the federal section all it asked for. The only part that’s not clear with that form is that the box 1 says winnings AND paid to in the same box with the original winnings and the amount they gave me after having pulled all the taxes. What im not fully understanding is turbo tax is saying I need to fill out MO state return and when doing so its formatting my OH return into MO return as if my AGI was from MO. The only amount I had received from MO was 1,600 and paid the tax on that. If I don’t file the MO state return does this mean I’d get audited? 
I’m sorry if all of that is convoluted. 

[DawnC]

You won't necessarily get audited, but you need to file the MO return to reconcile the taxes they deducted from your payment.  The casino does not know what amount of tax you owe, so they take out a flat amount and then you file a tax return to reconcile.  You may get some of the amount withheld back, or you may owe more tax than they withheld, or they may have taken the correct amount (not likely).

And what you are seeing on that MO non-resident return is correct.   Each state has different rules for calculating state income tax.  Some, like MO, start off with calculating tax on all income from all sources.  Then they figure what percentage your MO income is to your total income to figure your MO income.      As a non-resident of Missouri, you will only be taxed on MO sourced income (which is only your gambling winnings).

Generally, you’ll need to file a nonresident state return if you made money from sources in a state you don’t live in.  Some examples are:

• Wages or income you earned while working in that state
• Out-of-state rental income, gambling winnings, or profits from property sales
• S corporation or partnership income
• Beneficiary income from a trust or estate

Go ahead and complete the MO non-resident return.  Here are full instructions if you need them.    How do I file a nonresident state return?    

@user17714782655