Tax implications working in KCMO and living in KS (Kansas City: credit, homes)

[dickelfan]

Wife has been offered a promotion at her company which would require us to move to KC from Texas. One thing we have heard is that if you work in Mo, and live in KS you have to pay some sort of tax adjustment. Can any of you give me information on this?

[Anonymous Lurker]

I wouldn't worry about this too much, from what I've been reading here JOCO will probably poach her company over the the KS side and then it will be a moot point.

All joking aside I'm interested to learning this as well but on another note if its such a big concern why not just live and work in MO?

[dickelfan]

This will probably start some arguments, but from what we've read and heard the schools on the KS side are better (blue valley, etc). We have a 2 year old daughter and where we buy will be based a lot on the school districts.

[SPonteKC]

Originally Posted by dickelfan

This will probably start some arguments, but from what we've read and heard the schools on the KS side are better (blue valley, etc). We have a 2 year old daughter and where we buy will be based a lot on the school districts.

They are not. All of the suburban school districts are better than the Kansas City Missouri Public School District, but that district only serves a small portion of the actual city (about 60 square miles of a 315 square mile city), the rest is served by districts that range from moderate to excellent. The best Missouri side public school districts, both in the suburbs and in the suburban portions of KCMO proper are every bit the equal of anything in Kansas, and there is ample data to back that up.

With regards to taxes, there is a 1% earnings tax for residents of KCMO or those who work in the city but reside outside it. There is a current supreme court decision which may effect the way KCMO residents who work in Kansas would be refunded their Earnings Tax in the form of a credit from the State of Kansas, but all KCMO residents pay it. That said, I believe the overall tax burden is still lower in KCMO than in Johnson County, Kansas.

None of which is to say you shouldn't look at Johnson County. It certainly has what I think are the best suburban areas in the metro (Northeast JoCo and old Leawood), which are older, leafier, more established suburbs with good access to urban KCMO, where the overwhelming majority of cultural assets are. But if I was looking for a post-1980 or even brand new suburb, I would rate KCMO's Northland area, Lee's Summit, Blue Springs/eastern Jackson County, eastern Independence south Johnson County and Western Johnson County as more or less indistinguishable from one another and choose the one closest to work/travel patterns.

[MRG Dallas]

Originally Posted by dickelfan

Wife has been offered a promotion at her company which would require us to move to KC from Texas. One thing we have heard is that if you work in Mo, and live in KS you have to pay some sort of tax adjustment. Can any of you give me information on this?

In its simplest case, you prepare your Federal 1040 first.

Then you do the Nonresident state, Missouri, next. You report only your Missouri-scourced income, here would be your Wife's wages/salaries. You compute your Missouri tax based on that income and the deductions that Missouri gives you.

Lastly, you compute Kansas tax based on the whole of your incomes, with deductions allowed. Since income isn't "taxed twice" Kansas will allow a credit of the Missouri tax against the computed Kansas tax. Thus, you are considered not to be taxed again on the Missouri source income. You will pay whatever balance due to Kansas after application of the Missouri credit.

You will continue to be taxed on all other non Missouri income (e.g. your wages/salary, interest, dividends, etc) as Kansas sourced.

Since you will likely move mid-year, you will report to Missouri only that portion of her compensation since the move, as Missouri or Kansas neither has jurisdiction to tax you as Texas residents, only until you earn income or take up permanent residence in Mo and Ks, respectively. Thus you will file as a Part Year Resident for the year of move.



No need to file a Kansas City return generally, since her employer will directly withhold the flat 1% tax.

[Anonymous Lurker]

Originally Posted by dickelfan

This will probably start some arguments, but from what we've read and heard the schools on the KS side are better (blue valley, etc). We have a 2 year old daughter and where we buy will be based a lot on the school districts.

Well what gets me is that most parents know there are really very few public schools in the country that can truly provide a good quality education yet they still pawn their children off to public schools claiming they have no other options when in fact there are other options such as private schools, homeschooling,and now even digital courses.

I do understand you wanting the best for your child during her school years but choosing a home based on any public school is futile in my book as a child will excel if their parents help in their education and if the child is interested in learning and applying themselves.

[rwiksell]

Originally Posted by Anonymous Lurker

Well what gets me is that most parents know there are really very few public schools in the country that can truly provide a good quality education yet they still pawn their children off to public schools claiming they have no other options when in fact there are other options such as private schools, homeschooling,and now even digital courses.

I do understand you wanting the best for your child during her school years but choosing a home based on any public school is futile in my book as a child will excel if their parents help in their education and if the child is interested in learning and applying themselves.

This is just obtuse. Don't you think the vast majority of people would rather have their kids in private schools if they could afford them? Do you think it's because people don't know about private schools that they just dump their kids off at the nearest public school?

[denverian]

Originally Posted by Anonymous Lurker

Well what gets me is that most parents know there are really very few public schools in the country that can truly provide a good quality education yet they still pawn their children off to public schools claiming they have no other options when in fact there are other options such as private schools, homeschooling,and now even digital courses.

I do understand you wanting the best for your child during her school years but choosing a home based on any public school is futile in my book as a child will excel if their parents help in their education and if the child is interested in learning and applying themselves.

Not everyone can afford private school, and not everyone can afford for one parent to stay home and play teacher... nor is everyone equipped to try and teach their children everything they need to know to get to a GED. My kids go to a good public school, AND we're still very involved parents. There's no way I'd send my kids to a poorly performing school filled with behavior problems for them to pick up.

[94buickcentury]

Originally Posted by Anonymous Lurker

I wouldn't worry about this too much, from what I've been reading here JOCO will probably poach her company over the the KS side and then it will be a moot point.

All joking aside I'm interested to learning this as well but on another note if its such a big concern why not just live and work in MO?

Definitely the most annoying thing about Kansas City. Which sides better. Isn't there more important things to worry about than that like budget cuts to public education?

[94buickcentury]

Originally Posted by denverian

Not everyone can afford private school, and not everyone can afford for one parent to stay home and play teacher... nor is everyone equipped to try and teach their children everything they need to know to get to a GED. My kids go to a good public school, AND we're still very involved parents. There's no way I'd send my kids to a poorly performing school filled with behavior problems for them to pick up.

That is key right there and public schools are supposed to help those who are not as fortunate to afford private education. That is where tax payer money goes to, just not enough of it.