OK, gotta tax situation if you guys can help. My wife is a personal trainer who operates as a private contractor basically. She has an employer, but she gets a 1099-MISC instead of a W2. We physically live in IL (IL residents) but she works 100% in MO. Here's where I'm stuck...

Using Turbo Tax (been using it for years), the program is telling she owes $XXX in IL state taxes. This should be $0, but I can't figure out how to fill out the forms or what to do to avoid this.

Am I correct that there should be $0 state tax to IL and that the state tax would be paid to $MO?

Thanks guys.

 

Yes. File a non-resident Missouri return and pay Missouri's income tax. If she has no Illinois income, her Illinois tax liability should be zero.

Contact Intuit's tech support for assistance with their program or just start here: https://ttlc.intuit.com/questions/19...t-state-return

 

Ask your question here to find out how to do this in TurboTax.

The way I see it, you will need to file forms MO-1040 and MO-NRI, and pay taxes on that specific income to MO. You file an IL-1040 on all your other taxable income, assuming you are filing joint.

EDIT: Looks like SHO nailed it.

 

Just use the Rev. Al Sharpton's guide to paying taxes!!!

 

OK, agree with all you said. I just still can't figure out how in turbo tax to stop IL from taking their taxes. I'll dig.

 

The way it works in NC is that I have to file a state return in the other state that I earned income in. Then I still have to include that income on my NC state return, compute the tax and then deduct the taxes paid to another state from my NC state tax.

Turbotax screwed up several of my state tax returns and no matter what input I made to the program it would not correct the mistake. So, I quit using turbotax. I can believe Geitner when he said turbotax screwed up his tax returns!!!

 

Opt out of filing IL tax thru turbo tax. I do it every year. They keep asking me to file my OH taxes thru turbo tax, but I always say no because in Ohio you can file online for free. Why pay turbo tax 20 bucks to file my state taxes when I can get it done for free. Check and see if IL and MO has an online tax file setup and go that route.

 

MO does not have a direct e-filing option, you have to use software or a 3rd party online filing service.

My taxes are simple, so I've been using the free online TurboTax.

 

I've had a few complicated years here and there and turbo tax has helped. Now it's just worth the convenience cause everything transfers from year to year, it's familiar, and I know where everything is at. Even if turbotax user screens don't get it right, you can almost always swap to form view and do your work on the actual tax form and get it right.

 

It bothered me that turbotax kept my tax return records and automatically filled in the next years forms to the extent it could. That means it's just another database that can be hacked.

 

That's why I buy and download the software instead of using the online feature. If you e-file, that info is out there anyways.