Missouri Does Not Have a State Estate Tax
Missouri does not charge an estate tax on the property someone leaves behind when they die. This means that when a Missouri resident passes away, their heirs do not owe state taxes on inherited money, real estate, investments, or other assets—no matter how large the estate is.
The federal government does charge an estate tax, but only on very large estates. For deaths in 2024, the federal tax applies only to estates worth more than $13.61 million. Most Missouri families will never owe federal estate tax either. If you are unsure whether a specific estate might be subject to federal tax, a tax professional or attorney can review the numbers.
Key Takeaways
- Missouri has no state estate tax, so heirs pay no state tax on inherited property regardless of the estate's size.
- The federal estate tax only applies to estates larger than $13.61 million for deaths in 2024, and that threshold changes yearly.
- Some states do charge estate tax even though Missouri does not, so the tax rules depend on where the deceased person lived and owned property.
- An estate may still need to file a federal tax return and settle debts even if no estate tax is owed.
How Federal Estate Tax Works
The federal government taxes large estates, but the threshold is high enough that most people never encounter it. For 2024, an estate must exceed $13.61 million before any federal estate tax is due. This number increases each year based on inflation. In 2025, it is scheduled to rise further, though Congress can change the law.
The federal tax rate on estates that do exceed the threshold is 40 percent. However, married couples can combine their thresholds, which means a married couple's combined estate can reach roughly $27 million before federal tax applies. Even then, only the amount above the threshold is taxed at 40 percent.
Missouri residents who own property in other states should know that some states do charge their own estate tax. If a Missouri resident owned real estate or a business in a state with an estate tax, that state might claim tax on the portion of the estate located there. A tax professional can determine whether out-of-state property triggers additional state taxes.
What Happens to an Estate Without an Estate Tax
Because Missouri has no state estate tax, the main focus after someone dies is settling debts, paying any federal taxes owed, and distributing assets to heirs. The executor or personal representative handles these tasks, which typically take several months to a year or more depending on the estate's complexity.
Even though no state tax is owed, the estate may still need to file a federal income tax return if it earned income during the settlement period, such as interest on bank accounts or rental income from property. The executor files this return on behalf of the estate, separate from the heirs' personal tax returns.
When a Federal Estate Tax Return Is Required
A federal estate tax return (Form 706) must be filed only if the estate exceeds the federal threshold. For 2024, that means estates worth $13.61 million or more need to file, even if no tax is ultimately owed. Filing the return protects heirs by establishing the estate's value for tax purposes and starting the statute of limitations for the IRS to challenge the valuation.
Estates below the threshold do not need to file a federal estate tax return. However, the executor should still keep detailed records of all assets and their values at the time of death, because heirs may need this information for their own tax purposes when they later sell inherited property.
State Estate Tax Versus Inheritance Tax
Missouri has neither an estate tax nor an inheritance tax. These are two different taxes that some states use. An estate tax is paid by the estate itself before assets are distributed to heirs. An inheritance tax is paid by the heirs based on what they receive. Since Missouri has neither, heirs receive their full inheritance without owing state tax on it.
About a dozen states still charge estate tax or inheritance tax, but Missouri is not one of them. This is one reason some people choose to retire or relocate to Missouri—the state's tax structure is simpler for estates. However, if someone owned property in a state with an estate or inheritance tax before moving to Missouri, that state's tax rules may still explore to that property.
Planning for a Large Estate
If a Missouri resident has an estate that might exceed the federal threshold, planning ahead can reduce the tax burden. Common strategies include setting up trusts, making gifts during life (which do not count toward the threshold up to a certain annual amount), or establishing charitable giving plans. These approaches require professional guidance and should be discussed with an attorney or tax professional who understands federal estate tax law.
For most Missouri families, federal estate tax is not a concern. The threshold is high, and it applies only to very wealthy estates. However, anyone with significant assets—including real estate, investments, or a family business—should review their situation with a professional to understand what will happen to their estate and whether any planning would benefit their heirs.
Frequently Asked Questions
Do I owe Missouri state tax on an inheritance I received?
No. Missouri has no inheritance tax, so you owe no state tax on money or property you inherit. You may owe federal income tax if the inherited asset generates income after you receive it, such as interest or dividends, but the inheritance itself is not taxed by Missouri.
What if I inherited property in another state?
The state where the property is located may charge tax on it, even if you live in Missouri. Some states tax real estate or business property within their borders. You should check the tax laws of any state where you inherited property to see whether that state charges an estate or inheritance tax.
How do I know if a federal estate tax return needs to be filed?
If the total estate value at the time of death exceeds $13.61 million in 2024, a federal return (Form 706) should be filed. The executor or a tax professional can add up all assets—bank accounts, real estate, investments, life insurance, and personal property—to determine whether the threshold is met. The threshold changes yearly.
Can I reduce federal estate tax before I die?
Yes. Strategies like trusts, lifetime gifts, and charitable donations can reduce the taxable estate. These require planning with an attorney or tax professional. The rules are complex, and what works depends on your specific situation and family goals.
Is there a important date to file a federal estate tax return?
Yes. Form 706 must be filed within nine months of the person's death, though an extension can be requested. Missing this important date can result in penalties. The executor should work with a tax professional to may support the return is filed on time if one is required.