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Why do I owe so much to Illinois taxes this year? I live in Illinois but work full time in Missouri. Nothing changed from last year except for owing far more than ever.

I have never owed money to the state but this year I owe a bunch. Can someone help me understand why I owe $1k this year to Illinois?
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4 Replies
ee-ea
Level 15

Why do I owe so much to Illinois taxes this year? I live in Illinois but work full time in Missouri. Nothing changed from last year except for owing far more than ever.

A good way to find out what happened is to make a line by line comparison of this return and the prior one.

Why do I owe so much to Illinois taxes this year? I live in Illinois but work full time in Missouri. Nothing changed from last year except for owing far more than ever.

Everything is the same but it seems I’m not being credited my withholding that I already paid in Missouri to go towards Illinois.

Vanessa A
Expert Alumni

Why do I owe so much to Illinois taxes this year? I live in Illinois but work full time in Missouri. Nothing changed from last year except for owing far more than ever.

If you paid into MO, that does not go to IL.  So if your tax liability for IL is greater than your liability to MO, then you would still owe taxes to IL.

 

In general, your home state will tax all in come from all sources.  What you will do is you will file a nonresident return for the states that you do not reside in, but you visit for work and earn money in.  When you file, you will fille out your nonresident states first.  Then you will fill out your resident state, claiming a credit for taxes paid to the nonresident states on your home state return.  You may or may not still end up owing money to your resident state depending on whether or not their tax rate is higher or lower than your nonresident state.  If the non resident state had a higher tax rate than your resident state, your credit will be limited to the amount of tax you would have paid to your resident state.  They will not give you a refund of the taxes you paid to the nonresident state. 

 

 

Multiple States

File Non Resident State Return

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Hal_Al
Level 15

Why do I owe so much to Illinois taxes this year? I live in Illinois but work full time in Missouri. Nothing changed from last year except for owing far more than ever.

Q. I’m not being credited my withholding that I already paid in Missouri to go towards Illinois. Why?

A. It doesn't work that way.  If you paid MO too much withholding, you have to get a refund from MO.  You still have to pay IL separately. 

 

 

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