Here is the clean answer people search for: Arizona has no inheritance tax, no estate tax, and no gift tax. Your heirs will not owe the state of Arizona a percentage of what you leave them. Arizona's estate tax ended for deaths after 2004 and the statute was repealed in 2006, and the Department of Revenue says so in plain terms in its own publication.
Arizona estate tax + inheritance tax + gift tax, combined
$0
Confirmed by the Department of Revenue's own publication. The real cost to plan around is probate, and unlike a tax, it is optional.
Does the federal estate tax apply to you?
Almost certainly not. For deaths in 2026, a federal estate tax return is only required above $15,000,000 per person - and married couples can effectively combine their amounts. Unless your estate is in that territory, the federal estate tax is not your problem either.
The taxes that do touch Arizona inheritances
- Income tax on inherited retirement accounts. A traditional IRA or 401(k) passes without estate tax, but withdrawals are taxable income to the heir, and most non-spouse heirs must empty the account within ten years.
- Capital gains, usually softened. Inherited property generally receives a stepped-up basis to date-of-death value, which erases the gain that built up during your lifetime. Heirs who sell quickly often owe little or nothing.
- Another state's rules. If you own property in a state that has its own death taxes, that state may reach it even though Arizona does not.
So why do Arizona estates still shrink?
Because the cost here is not a tax - it is probate. Court fees, attorney fees scaling with the estate, appraisals, months on a calendar, everything public. Families who plan around probate keep what the tax code never touched. See every legal route around it, or put your own numbers in the probate cost calculator.
Sources
- Arizona Department of Revenue Publication 900 - Estate Tax (checked 2026-08-09)
- IRS - Estate Tax (filing thresholds by year of death) (checked 2026-08-09)
Educational information only, not legal or tax advice. Federal thresholds change by year of death - confirm your situation with a licensed professional.