Will your family owe taxes on the money, property, or investments you leave behind? For Springfield families preparing an estate plan, there’s some encouraging news: Missouri does not impose a state estate tax or inheritance tax.
This doesn’t mean every inheritance arrives without tax consequences or administrative expenses, though. Federal estate taxes, inherited retirement accounts, probate, and property in other states can still complicate matters. Here’s what Missouri families should understand before making decisions about their legacy.
Learn more about tax planning from LaTour Asset Management of Springfield.
Understand the Difference Between Estate and Inheritance Taxes
Although people frequently confuse the two, estate and inheritance taxes work differently.
- Estate tax: This tax is generally assessed against a deceased person’s taxable estate before assets are distributed to beneficiaries.
- Inheritance tax: This tax is imposed on beneficiaries based on assets they receive, potentially depending on their relationship to the deceased.
Missouri currently imposes neither tax, but certain assets or beneficiaries with connections to other states may face additional tax considerations.
Don’t Overlook Federal Estate Tax Rules in 2026
Even without Missouri estate taxes, larger estates may still face federal taxation. For 2026, the federal estate and gift tax basic exclusion amount is $15 million per individual. Married couples may potentially preserve the benefit of both spouses’ exclusions through appropriate estate planning and portability elections. The top federal estate tax rate is 40%, although that rate does not apply to the entire estate automatically.
The annual federal gift tax exclusion is $19,000 per recipient in 2026. Gifts exceeding that amount may require reporting without necessarily creating an immediate tax payment.
These thresholds mean many families may not face federal estate taxes, but changing asset values, lifetime gifts, and previous planning decisions can influence the calculation.
Consider the Costs That Can Still Affect Your Heirs
An inheritance can create financial responsibilities even when no Missouri inheritance tax applies. For example, beneficiaries inheriting Traditional IRAs or tax-deferred retirement accounts may owe ordinary income taxes on distributions. Certain non-spouse beneficiaries must also generally empty inherited retirement accounts within ten years, subject to applicable rules and exceptions.
Probate is another consideration. Depending on how assets are titled and transferred, an estate may require court administration, creating expenses and delays. Also, property located outside Missouri may introduce additional complications, particularly in states with their own estate or inheritance tax laws.
Protect Your Legacy With Thoughtful Planning
Missouri’s tax treatment can make wealth transfers less complicated, but careful preparation is still important. At LaTour Asset Management of Springfield, our advisors can help you evaluate how investments, retirement accounts, and legacy goals fit into your broader financial plan, while coordinating with qualified estate attorneys and tax professionals. Call us at (877) 888-5724 to discuss how thoughtful planning may help you approach your family’s financial future with greater confidence.
