My company took out the wrong state's taxes? What do I do?

jeffhq — Tue, 04 Jun 2019 00:48:45 GMT

I lived in Kansas City, MO, but worked in Kansas City, KS. My company took out Kansas state tax the entire year. I see the rules are to pay state tax to your resident state. How do I fix this? Right now, it says I owe money to Missouri, but I've already paid all the tax to Kansas.

OK...so now you are finding out about how to file taxes w...

SteamTrain — Tue, 04 Jun 2019 00:48:47 GMT

OK...so now you are finding out about how to file taxes when you cross state lines.

There are some states, that have a tax agreement with the bordering state, such that a resident of (say) Ohio, can work in PA, MI, KY, IN or WV....and they only pay taxes in their home state of Ohio.

But MO and KS have no such agreement with any other state.

SO..?

AFTER, you are absolutely sure you have everything entered in your Federal tax return...every scrap is done and error checked

.....Then.... you have to prepare a KS Non-Resident tax return...which will tax just that KS income. The KS nonresident tax return has to be prepared before MO.

....Then...after the KS one is done, you work thru all of the MO Resident tax return questions. MO taxes all your income from everywhere and calculates a tax on everything...But, somewhere in the MO questions is a place to take a credit for the taxes that KS kept for the KS wages.

Thus the KS tax return has to be done first. The MO credit is not what KS withheld...it is what KS kept, with some mathematical handwaving since the tax rates for KS and MO do not match. Example: $3000 KS withholding, but a $1000 refund is the result of the KS nonresident tax return...so you can only claim "up to" $2000 as the MO credit (the software will figure the exact amount for you as long as you do the KS non-resident tax return before MO.)

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My company took out the wrong state's taxes? What do I do?

OK...so now you are finding out about how to file taxes w...