KC rescinds unworkable earnings tax refund ordinance

March 6, 2023 - Last week, the City Council of Kansas City adopted a new earnings tax ordinance that changes the unworkable refund process that required appeal forms to be filed with each withholding of the earnings tax and filing of a claim in court.

Here is the new process, as stated on the Kansas City Missouri website:

"The City of Kansas City, Missouri has changed the process for a taxpayer to request a refund of the wage earner refund tax for tax year 2022. On Thursday, March 2, 2023, Section 68-393 of the City’s Code of Ordinances was amended. Under the amended ordinance, a taxpayer must complete the following steps to properly request a refund of the earnings tax:

1. The taxpayer must submit Form RD109 and RD109NR (see documents here), if applicable; and

2. The taxpayer must submit sufficient documentation to show that the taxpayer is entitled to a refund; and

3. All of these documents must be submitted by the federal income tax deadline.

As stated above, the amendment requires documents to be submitted by the federal income tax deadline. For example, a request for refund of 2022 wage earner taxes paid must be submitted by April 18, 2023, which is the due date for federal tax filings this year. Wage earner refund requests not timely submitted will be denied as required by the amended ordinance.

An extension request filed with the City of Kansas City, Missouri will provide a taxpayer with six additional months to file the return. However, the taxpayer must comply with the City’s Municipal Code of Ordinances to be considered valid."

"We are pleased the City of Kansas City has changed the previously unworkable earnings tax refund process," said Ray McCarty, president/CEO of Associated Industries of Missouri. "Money earned outside the City may not be taxed, so it is good to see city officials returning to a workable refund process for workers working from home or other locations outside the City," he said.

The ordinance amendment was sponsored by Mayor Quinton Lucas. You may see the documents related to the ordinance HERE.