Missouri Capital Gains Tax Rate (2026)
Missouri capital gains tax overview
Seven brackets from 2% to 4.7%. No special capital gains treatment.
Federal + Missouri combined rates
Your total capital gains tax bill includes both layers — federal and state. Here is what a Missouri investor pays in 2026 for long-term gains:
| Federal Long-Term Rate | Missouri State Rate | Combined Rate | Plus NIIT (if applicable) |
|---|---|---|---|
| 0% | 4.70% | 4.70% | 8.5% |
| 15% | 4.70% | 19.7% | 23.5% |
| 20% | 4.70% | 24.7% | 28.5% |
The NIIT (Net Investment Income Tax) adds an extra 3.8% for taxpayers whose MAGI exceeds $200,000 (single) or $250,000 (married filing jointly). It is a federal tax only — Missouri does not have an equivalent.
How Missouri compares to other states
Missouri's top rate of 4.70% places it in the lower-middle tier of state capital gains taxation. For comparison:
- Zero-tax states (FL, TX, NV, etc.): 0% — total with 15% federal = 15%
- Low-rate states (AZ, IN, PA): 2.5–3.1% — total with 15% federal = 17.5–18.1%
- Missouri: 4.70% — total with 15% federal = 19.7%
- High-rate states (NY, NJ): 10.75–10.9% — total with 15% federal = ~26%
- California: 13.3% — total with 15% federal = 28.3%
Tax-reduction strategies for Missouri residents
With a top state rate of 4.70%, minimizing capital gains tax is particularly important in Missouri. Key strategies:
- Hold over 1 year for long-term federal rates (0/15/20%). Missouri does not offer a preferential state rate, but federal savings alone are often 7–17%.
- Tax-loss harvesting: Offset your gains with losses realized in the same year. A $20,000 loss offsets $20,000 of gains dollar-for-dollar, saving up to 25% ($4,940) on that $20,000 at top rates.
- 0% bracket planning: In lower-income years (retirement, sabbatical, between jobs), realize gains at the federal 0% rate. You still owe Missouri state tax, but eliminating the federal component is significant.
- Donate appreciated stock directly to charity or a donor-advised fund to avoid capital gains tax entirely while generating a charitable deduction for the full fair market value.
- Installment sales: If selling a business or real estate, structuring as an installment sale spreads the gain over multiple years, potentially keeping each year's gain in a lower bracket.
Detailed Missouri capital gains tax rules
Tax history and legal basis
Missouri taxes capital gains as ordinary income with a progressive system. The top rate has been reduced to 4.8% effective 2025.
Exemptions and special treatment
Missouri allows a deduction for 100% of federal income tax paid (capped at $5,000 single / $10,000 MFJ). This indirectly reduces the effective state tax on capital gains. No specific capital gains exclusion exists, but the federal deduction is significant for high earners.
Filing requirements
File Form MO-1040 (resident). Missouri starts with federal AGI and allows the federal tax deduction. Estimated payments required if owing $100+. Filing deadline is April 15.
Recent changes and legislative updates
Missouri reduced its top rate from 5.3% (2023) to 4.8% (2025), with plans to reach 4.5% by 2027. The state's allowance for deducting federal taxes paid makes the effective rate significantly lower than the statutory rate for taxpayers with substantial federal tax liability.
Worked example: $50,000 capital gain in Missouri
Here's exactly what a Missouri resident would owe on a $50,000 long-term capital gain with $80,000 in other income (single filer, 2026):
| Component | Amount | Notes |
|---|---|---|
| Capital gain | $50,000 | Long-term (held over 1 year) |
| Federal tax (15%) | −$7,500 | Based on $80,000 ordinary income + gain |
| Missouri state tax (4.8%) | −$2,400 | Applied to the full gain amount |
| Total tax owed | −$9,900 | Federal + state combined |
| You keep | $40,100 | 80.2% of your gain |
After both federal and Missouri state tax, you keep $40,100 of your original $50,000 gain. The effective combined rate is 19.8%.
Frequently asked questions — Missouri
Does Missouri tax short-term and long-term gains differently?
No — Missouri taxes both short-term and long-term capital gains as ordinary income at the same rates as wages. There is no state-level preferential rate for patience. The federal system, however, taxes long-term gains at 0/15/20% vs. up to 37% for short-term — a significant difference that applies regardless of state.
Do I need to file a Missouri tax return if I only have capital gains?
If you have capital gains income and meet Missouri's filing threshold, you are required to file a Missouri state income tax return. The threshold is typically similar to the standard deduction amount — check the MO Department of Revenue for the current year's filing requirements.
What if I moved to Missouri mid-year?
If you moved to Missouri during the year, you are a part-year resident. Missouri generally taxes capital gains realized while you were a Missouri resident. Gains realized before you moved may be taxable by your prior state. Keep detailed records of when each sale occurred relative to your move date.