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Level 1

Working in MO and staying in KS. How to avoid double tax ?

 
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Level 12

Working in MO and staying in KS. How to avoid double tax ?

It depends.  Those states each require a tax return.  You will file as a resident for Kansas and a non-resident for Missouri.  Kansas will give you a credit for the tax you pay in Missouri, but only up to the amount of Kansas tax on the same income.  So if you earned 50,000, and Missouri taxes you 2000 but Kansas only taxes you 1800, you will receive a credit of 1800 on your Kansas taxes to bring it down to zero.  You will not be reimbursed further.  And if Kansas has a higher tax rate than Missouri, you will have a balance you still owe to Kansas.

To avoid the double-taxation (or at least the need to fill out two state returns), unfortunate about the only two real options are to either move to Missouri (working and living in Missouri) or work in Kansas (living and working in Kansas). 

Having said that, TurboTax will make sure you are not over-taxed.  In the Personal Info Tab, make sure you answer “yes” to the question if you worked in another state besides Kansas and select Missouri.  Fill out your Missouri return first and TurboTax will transfer all of the necessary information to your Kansas return to calculate and apply the credit.

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Level 12

Working in MO and staying in KS. How to avoid double tax ?

It depends.  Those states each require a tax return.  You will file as a resident for Kansas and a non-resident for Missouri.  Kansas will give you a credit for the tax you pay in Missouri, but only up to the amount of Kansas tax on the same income.  So if you earned 50,000, and Missouri taxes you 2000 but Kansas only taxes you 1800, you will receive a credit of 1800 on your Kansas taxes to bring it down to zero.  You will not be reimbursed further.  And if Kansas has a higher tax rate than Missouri, you will have a balance you still owe to Kansas.

To avoid the double-taxation (or at least the need to fill out two state returns), unfortunate about the only two real options are to either move to Missouri (working and living in Missouri) or work in Kansas (living and working in Kansas). 

Having said that, TurboTax will make sure you are not over-taxed.  In the Personal Info Tab, make sure you answer “yes” to the question if you worked in another state besides Kansas and select Missouri.  Fill out your Missouri return first and TurboTax will transfer all of the necessary information to your Kansas return to calculate and apply the credit.

Level 1

Working in MO and staying in KS. How to avoid double tax ?

at what point in the turbo tax process do i see the credit for my KS balance due?
Level 2

Working in MO and staying in KS. How to avoid double tax ?

Hello,

 

Just received a nice letter from the Kansas Department of Revenue saying for the year 2017 they were "unable to verify the amount of Withholding claimed.  Please submit all W-2s and 1099-Rs depicting KS withholding." The total balance they are saying I owe is significant.  

 

I pulled out all of my documentation and the exact amount they say they are unable to verify was  listed on a W-2 from a job I had in Missouri.  I was not at this job the whole year.   The way I understood it is that KS would give me a credit for work performed outside the state.  For the year 2017 I did file a KS and a MO tax return and listed I was a resident of KS and a non-resident of MO.   However, I'm not sure what my next step is, do I write the Kansas Department of Revenue back and tell them the reason for the discrepancies is due to the fact I was working in MO?  Also is it recommended to pay the amount they say I owe to stop the interest and penalties?  Any guidance is greatly appreciated.  

 

 

Level 17

Working in MO and staying in KS. How to avoid double tax ?

@ruru1999  You should send them the forms they're requesting.

To check the accuracy of the withholding you actually reported in 2017, look at Line 21 of your 2017 Kansas tax return, Form K-40.  The amount on Line 21 should equal the total amounts listed for KS on line 17 of your W-2's and line 12 of your 1099-R's.

KS appears to be telling you that the amounts do not match.  

 

Level 2

Working in MO and staying in KS. How to avoid double tax ?

Thanks Tom for the advice,

 

You were able to point me in the right direction.  The discrepancy was found on the K-40 form for Kansas line 13 "Credit for taxes paid to other states"  it was at $0.  After amending my KS taxes they now owe me as I did not  receive my credit in 2017.  So I guess i'm grateful for their assessment.  

 

Thanks again,