How can you show taxes paid to another state? My wife and I live in Missouri and work in Kansas. I need help showing what was already paid to each state to avoid owing MO

[amax8602]

I cannot figure out what I am doing wrong to owe my resident state of Missouri. All of the online help says to do the non-resident state first, which in my case is Kansas. I thought that I had. I even deleted the Missouri return to enter again. Anybody else have this issue?

[TomD8 · Accepted solution]

Doing your non-resident state return first was correct.  If the credit you received (on your MO return) for taxes you paid to KS was less than the taxes you owe to MO, you would wind up with a small balance due to MO.  MO's tax rates are a bit higher than KS's.

Your out-of-state credit for taxes paid appears on line 13 of your K-40.

[CRMO]

I think this is an incomplete answer. This situation applies to me too. In preparing the K-40 first (as nonresident for 2022), line 13 asks for cr. paid to other states. The KS 40 has total tax $960 before the line 13 cr. so I paused and moved onto MO-1040. It has total tax 2181 before the cr for KS taxes. On MO-CR, the cr for KS tax is 829 (KS inc. = 38% of total, so 38% of 2181 MO tax = 829), bringing the MO tax down to 1352.

What is entered then on K-40 line 13? Instructions state, "...the credit amount cannot exceed the tax liability shown on the other state’s tax return and the income derived from the other state must be included in your Kansas adjusted gross income (KAGI), line 3 of Form K-40."

1352?

$960 (ie it can't exceed the total preliminary KS tax)?

$0? (as this seems to be only for KS residents or partial residents filing as NRs?)

In the case of #1 or 2, that would result in $0 KS tax which doesn't seem right. I had $897 in KS withholding... I am thinking the cr for taxes pd to another state is only applicable on one state return and you take it only on one return (in my case MO resident return)? The K-40 instructions go on to address Line 13 for KS residents and for partial residents filing as nonresidents which implies this to be the case.