Tax implications working in KCMO and living in KS

[MLSFan]

I live in MO and worked in KS, had to pay KS and MO taxes, doesn't seem to matter a whole lot. The rates are slightly different but not noticeable. Filing online is fairly easy, the software does it all. KS gave tax returns slower though but that's about it.

[pioneer88]

My wife works downtown KCMO and we live in JOCO. Usually our Missouri tax return is enough to cover what we owe to Kansas. We file our own taxes and it's pretty simple really. As for schools, Private schools are unnecessary in Johnson County and many Missouri Suburbs. We have great public schools! Good luck and welcome to Kansas City!

[rwiksell]

Originally Posted by 94buickcentury

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?

Exactly! Why are worrying about silly little things like providing quality education for our children, when we could be focusing on more ways to give small businesses gratuitous tax cuts, and big businesses obscene incentives to build greenfield developments ten miles away across the state line?

Priorities, people!

[kcmo]

Where will she be working in KCMO? If you want good suburban schools, JoCo is great, but not the only choice and often not the most convenient. If working in downtown KCMO, then I always find it silly to live clear out in JoCo (or Lee's Summit etc) when you have so many nice suburban areas minutes away in the northland.

Don't worry about taxes. They are easy between MO and KS and are nearly irrelevant. People will get all worked up over a difference of $500 in annual tax burden and completely ignore many other far more burdening costs or quality of life issues such as housing costs, commute times and finding a home that fits your lifestyle. Find the house you like in an area you like, but look at all areas of the metro before making that decision (most people moving to area are directed to JoCo when there are many more options) and don't worry about the differences in taxes, it's not an issue.

[SPonteKC]

Originally Posted by kcmo

Where will she be working in KCMO? If you want good suburban schools, JoCo is great, but not the only choice and often not the most convenient. If working in downtown KCMO, then I always find it silly to live clear out in JoCo (or Lee's Summit etc) when you have so many nice suburban areas minutes away in the northland.

Don't worry about taxes. They are easy between MO and KS and are nearly irrelevant. People will get all worked up over a difference of $500 in annual tax burden and completely ignore many other far more burdening costs or quality of life issues such as housing costs, commute times and finding a home that fits your lifestyle. Find the house you like in an area you like, but look at all areas of the metro before making that decision (most people moving to area are directed to JoCo when there are many more options) and don't worry about the differences in taxes, it's not an issue.

Close this thread now and make this perfect post a sticky or just cut and paste it into every thread about where to live in the metro for "good schools".

[Xatrina]

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?

This is very common all over the USA for areas that straddle two state lines. Most states have a resident & non-resident form. You pay the state where you earned the income, and get a credit from the state where you reside. Think PA/NY, RI/MA, SC/NC, etc.
Both my husband & I now work in MO but live in Kansas. We file a non-resident tax form for MO. Their tax forms are horrible, worst I've ever seen, and I've had to file in about 10 states this way with double tax forms. Their tax forms just seem to be more "percentage happy" than other states I remember doing this for.

MO makes you do percentages of how much income comes from each spouse and from Missouri sources (your wife's job) and how much from other sources (your job in Kansas, perhaps?).
She'll have witholding taken out for Missouri. Depending on her company, she can have Kansas witholding also taken out, also.

Then when you're finished with the MO forms, you fill out KS. You get a credit for taxes paid to MO. Worst case we had was when I was making more than my husband in a KS job, his was in MO. We ended up owing Kansas a painful amount, so I had my KS withholding adjusted up for the next year.

Now we both work in MO but still live in KS. We usually get a small refund from MO and have to pay KS a bit more than that refund. It's been like that every place we lived in two states - the resident state always grabs a bit more than you paid the other state.

If you itemize on federal, you write both of them off as deductions. Tax preparers charge by the page/form, so if you hire someone, it will cost more, obviously, to prepare returns for 2 states vs. one. And your first year, you're going to have Texas in there, as well.

None of it's difficult, it's just tedious if you do it yourself. Rent in MO and move to KS later if your wife keeps the job & you like the area, but want KS schools.

[Okey Dokie]

Those crazy Missouri forms with all those percentages are the best reason for buying tax software like Turbo Tax or Tax Cut. They figure it for you.

One earnings tax fact not mentioned yet is if you are not a KCMO resident, you can deduct those work days you don't work in KCMO from your earnings tax, i.e. your office is in KCMO but you travel for work 25% of the time you only pay earnings tax on 75% of your income. Have to keep good records.

[TabulaRasa]

Both my spouse and I have had the "work in one state, live in the other" situation as long as we've known one another (both due to the state line issue and when my husband, a military member, has been on billets that required us to move to out-of-state installations for a preset length of time while still maintaining an address of record in KS). It can be a pain (moreso for the military aspect, for us, than just the average civilian "I work in MO but live in KS" issue), but it's always balanced out.

We do prep our own taxes, which is a headache in our non-straightforward situation. If it were solely my decision, somebody else would do the heavy lifting. It's not hard, per se, but it's definitely tedious.

[MRG Dallas]

Originally Posted by kcmo

Where will she be working in KCMO? If you want good suburban schools, JoCo is great, but not the only choice and often not the most convenient. If working in downtown KCMO, then I always find it silly to live clear out in JoCo (or Lee's Summit etc) when you have so many nice suburban areas minutes away in the northland.

Don't worry about taxes. They are easy between MO and KS and are nearly irrelevant. People will get all worked up over a difference of $500 in annual tax burden and completely ignore many other far more burdening costs or quality of life issues such as housing costs, commute times and finding a home that fits your lifestyle. Find the house you like in an area you like, but look at all areas of the metro before making that decision (most people moving to area are directed to JoCo when there are many more options) and don't worry about the differences in taxes, it's not an issue.

LOL. Hey what's $500 if you're burdened with student loans, a mortgage, trying to raise a family, working at your first job? And yes, it is a consideration including the costs of compliance for lots of people.

[kcmo]

Originally Posted by MRG Dallas

LOL. Hey what's $500 if you're burdened with student loans, a mortgage, trying to raise a family, working at your first job? And yes, it is a consideration including the costs of compliance for lots of people.

Well then if you really are worried about saving $500 and are living that close to the edge, then buying a home or renting in Johnson County where homes and rents cost 10-20% more for the same home or apartment in an equal neighborhood of the Northland or Lee's Summit and have higher property taxes and the overall tax burden (sales, income etc) is generally higher would be an absolutely terrible financial decision.

So I'm not sure what your point is.

$500 = $1.36 a day. If you are relocating to KC for a job and that amount is dictating where you live, not only do I think you would be stupid to live in JoCo and pay 10-20% more for the same thing (plus a potential longer and more costly commute), but I think they should not be moving in the first place, or maybe they should be looking at more affordable houses or neighborhoods.