Skip to content
statelinetax.comChecker

Live in Iowa, Work in Missouri: Which State Taxes Your Paycheck?

Both states — credit offsets the double taxMissouri withholds

Answer

Missouri withholds and Iowa credits. Without an agreement between them, both states are entitled to tax income earned in Missouri by a Iowa resident. The mechanism that stops you paying twice is the credit on the Iowa resident return, which is why the Missouri return has to be completed first.

Last verified

Two states can lawfully tax the same wages: Missouri because the work happened there, Iowa because you live there. Nothing prevents the overlap in advance — it is unwound afterwards, on the Iowa return, through the credit for taxes paid to another state.

A Iowa resident taxed by another state on the same income claims the credit for taxes paid to other states on Form IA 130. The credit is capped at the Iowa tax on that income, so it removes the double tax but never refunds the excess when the other state charges more.

Missouri also has a layer below the state one, and it is the layer that survives every agreement: Kansas City and St. Louis each levy a one per cent earnings tax on wages earned inside the city, collected by the city. Nonresidents pay it on the portion of work performed there.

What you file

  1. 1Nonresident return · MissouriForm MO-1040 with Form MO-NRI

    File the Missouri nonresident return FIRST — you need the Missouri tax figure before you can complete Iowa.

  2. 2Resident return · IowaForm IA 130

    File a Iowa resident return reporting all income, then claim the credit for tax paid to Missouri. The credit is capped at what Iowa would have charged on that same income, so if Missouri taxes it at a higher rate the difference is not refunded.

The two states, side by side

 IowaMissouri
Taxes wagesYes — flatYes — graduated
Reciprocity partners1 (Form 44-016)None
Convenience ruleNoNo
Nonresident returnForm IA 1040 with Schedule IA 126Form MO-1040 with Form MO-NRI
Credit for other-state taxForm IA 130Form MO-CR
Nonresident safe harbourNone publishedNone published
Local income taxYesYes
Revenue departmentIowa Department of RevenueMissouri Department of Revenue
Last verified

The other direction

Reversing the commute does not always reverse the answer. Living in Missouri and working in Iowa gives:Both states — credit offsets the double tax.

Missouri to Iowa →

Same two states, different situation

The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.

Other Iowa pairs

Questions people actually ask

I live in Iowa and work in Missouri. Which state takes the tax out of my paycheck?

Missouri withholds and Iowa credits. Without an agreement between them, both states are entitled to tax income earned in Missouri by a Iowa resident. The mechanism that stops you paying twice is the credit on the Iowa resident return, which is why the Missouri return has to be completed first.

Which state should my employer be withholding for?

Missouri. The wages are sourced to Missouri, so Missouri withholding is correct and there is no Iowa withholding to set up.

Will I end up paying tax twice on the same income?

Not twice over, but you will pay the higher of the two rates. Iowa gives residents a credit for tax paid to Missouri on the same income, claimed on Form IA 130. The credit is capped at the Iowa tax on that income, so if Missouri taxes it more heavily the excess is not refunded by either state.

How current is this?

The Iowa and Missouri rules on this page were last checked against Iowa Department of Revenue and Missouri Department of Revenue on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.

Sources

Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.