Missouri Eliminates Tax Deduction for Out-of-State Workers

JEFFERSON CITY, MO - Missourians will be getting a tax cut on their Social Security benefits but workers who live out of state, including Tennesseans, will soon have to pay more in income taxes.

Missouri Governor Matt Blunt just signed legislation gradually exempting most Social Security benefits from state income taxes, starting this year and being phased in through 2012.

The bill also eliminates an income tax deduction for those who work in Missouri but live elsewhere.  People who pay property taxes in another state have been allowed to deduct that from the income tax they pay in Missouri, just like Missourians are allowed to deduct their in-state property taxes from their income taxes.

Legislative researchers estimate the tax increase could bring in $11 million annually, most of it coming from residents of Tennessee and other neighboring states.

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