Inheritance Tax

Updated 2026-05-17

An inheritance tax is a state-level tax levied on the assets received by beneficiaries from the estate of a deceased person. It is distinct from an estate tax, which is levied on the total value of the deceased person's estate before distribution. The inheritance tax is paid by the individual who inherits the property, rather than by the estate itself.

The presence or absence of an inheritance tax can significantly influence the financial appeal of property ownership and the transfer of assets within a particular state. For instance, Arizona does not impose a state-level inheritance tax, which is often viewed as a beneficial factor for property owners and their heirs. This absence can be a key consideration for individuals evaluating real estate investments in the state.