Arizona Has No Inheritance Tax
Arizona repealed its inheritance tax decades ago and does not impose a state estate tax. Most Arizona families pay no transfer tax at all when an estate is settled.
Federal Estate Tax Still Applies
The federal estate tax is paid by the estate, not the heir, and only applies to estates above the federal exemption (more than $13 million per person in 2026). It is separate from any state inheritance tax.
Out-of-State Inheritances
If an Arizona resident inherits property located in or from a person who lived in a state with an inheritance tax (such as Pennsylvania, New Jersey, Kentucky, Maryland, or Nebraska), that state's tax may apply to the transfer. The tax is reported and paid in that state, not in Arizona.
Arizona Probate Claims
Even where no inheritance tax applies, the estate must still satisfy creditor claims under A.R.S. 14-3104 before distribution.