Lots of our clients come in with a story that goes like this: We filed our federal tax return and we don’t owe them anything but the Missouri Department of Revenue is on our case! How is this possible if I worked in Kansas during that year?
The fact is, if you live in Missouri and worked in Kansas, you have to file a tax return in BOTH STATES. It doesn’t seem fair on the face of it–you’re only one person!–but Missouri will give you a tax credit for taxes paid in Kansas. In other words, if you pay Kansas $1,000 during the year, and your Missouri tax bill is $1,500, you only have to pay the Missouri Department of Revenue $500, since they give you a credit for what you paid to Kansas.
But what happens when you don’t file your Missouri taxes? The Missouri Department of Revenue might file your tax return for you. Unfortunately, the Missouri Department of Revenue doesn’t usually even have record of how much you have paid THEM, much less how much you have paid Kansas, so they will assume that you did not pay them or Kansas anything and tax you as if you had zero withholdings. If this doesn’t sound right, it’s because it’s not right, but it’s how the Missouri Department of Revenue operates. Fortunately for you, if you file tax returns to replace the returns that the Missouri Department of Revenue has filed for you, your account will reflect the correct amount you should really owe (plus penalties and interest) and that will be the end of it.
If you’re receiving letters from the Missouri Department of Revenue, you may need help getting everything filed. Kansas City Tax Mediation specializes in helping Kansas City Taxpayers with this issue (and as you can imagine, there are lots of taxpayers who live in one state, work in another, and have this problem).
Call us today to schedule a free, face to face consultation to discuss the best solution to your Missouri Department of Revenue problem. Kansas City Tax Mediation: Let’s get through this together.