I lived in MO from January through July working for a company in STL. I moved to MS and began working remotely for the same company in STL. How do I file MO and MS taxes?

[ktrapp]

The W-2 from my employer only shows state / local wages for MO but nothing for MS. I contacted my employer about this and they said that since MO tax rate is higher than MS tax rate that they don't need to file anything for MS but that I should talk to a tax advisor about what I need to file. Everything I've read indicates that telecommuting is counted for the state it is performed in which in my case would be MS. I'm trying to determine what I need to do to get my MO and MS taxes filed correctly.

[DanielV01]

In this case you are correct.  You will file part-year returns for both Missouri and Mississippi.  You pay tax to MS for the income you earned while living there.  It is not MO nonresident income because MO does not tax the telecommuter (there are some states that do, but MO is not one of them).  

On the MO part-year return, you will need to allocate your income to tell MO how much of the income was earned prior to your move.  You will claim that income in MS, and you will pay tax on the income in MS.

Your employer is not correct.  They should withhold your tax to MS and not MO.  How much income tax you pay to MO vs. MS is irrelevant.  You don't pay tax to MO, period.  By not withholding MS, you will face penalties in MS next year if you do not pay enough in.  It may be inconvenient for the employer to set up an account with MS to send the state tax withholdings, but they are required to do so.

St. Louis is a situation that cannot be arranged on the Missouri return.  You will need to contact St. Louis revenue commission to inquire about any possible refund of St. Louis local tax withheld after you moved to MS.  TurboTax does not have the forms to prepare a local St. Louis return.

[jschuman]

I'm not sure  this is correct or at least a typo ...

On the MO part-year return, you will need to allocate your income to tell MO how much of the income was earned prior to your move. You will claim that income in MS, and you will pay tax on the income in MS.

Don't you mean MO instead of MS in this paragraph?  I'm assuming "that income" is referring to MO income earned prior to moving out of state in the last sentence.

Please correct me if I'm wrong.

[TomD8]

Income earned as a MO resident is allocated to MO; income earned as a MS resident is allocated to MS.  For the tax year in which you moved, you will file a part-year resident return in each of the two states.

If your employer incorrectly continued to withhold MO taxes after your move to MS, you are entitled to a refund of the incorrectly withheld portion.

If your employer cannot or will not withhold MS taxes, you may want to consider making estimated tax payments to MS.  

If you no longer are a resident of nor physically work in MO, you should request your employer to cease withholding MO taxes.