Submission Alert: Credit Claimed for Taxes Paid to Another State

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StevenW7
StevenW7 Member Posts: 1 Newcomer

For reference, I am filing federal taxes, nonresident state taxes to IL (where I work) and full-time resident state taxes to MO (where I live).

At the end of my taxes submission, on the Tax Return Alerts page, it says:

Double-Check Credit Claimed for Taxes Paid to Another State

For the Credit for Taxes Paid to Another State claimed on your Missouri return, you entered the same amount of tax for the other state as your tax withheld by that other state. Your tax amount for a state is usually not the same as your tax withheld by that state. Your other state tax usually is the actual amount of tax shown on that state's tax return.


If you're filing your other state return with us, we recommend that you continue and get a preview copy of that state's return (NOT the Missouri return). Make sure you've completed your other state's tax return. Look on the other state's return and find the line showing the other state's tax. Then go back to the Your Taxes Paid to Another State screen and change the other state's tax amount to the actual tax on the other state return that was from income taxed by both states.

There is a second box that pops up, stating:

Update Taxes Paid to Another State

Listed below are your income taxes you told us were paid to other states. If you've made any changes on your other state returns, you should make sure the amounts below are correct.

IL: $XXXX

If you need to change any of these amounts, please go back to the Your Taxes Paid to Another State screen.

So on my Nonresident return, I said I paid the above amount. I am not quite sure what the issue is.

Thanks for any help or support!

Answers

  • Taxlady06
    Taxlady06 FreeTaxUSA Agent Posts: 59
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    When you live in one state and work in another, all of your income is taxable in your resident state. Additionally, all of the income from your out-of-state work is taxable in the working state. To help with this double taxation, you can get a credit on your resident return for the taxes paid to the non-resident state.

    Our software supports this credit. As part of the filing process, the software will alert you with a yellow alert to remind you to double check that the amounts reported are correct. As both returns can be updated individually, the amounts may change from what was originally entered.

    If the amounts have been correctly reported, you can simply ignore the yellow alerts and continue to file your return. The yellow alerts are simply letting you know that you might want to check something, these will not prevent you from filing your return.