51 – Show-Me (the Money) State
Published by Dr. Business · May 13, 2025
51 – Show-Me (the Money) State
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The Show-Me State Just Showed Up
Missouri just poked the proverbial bear with a cattle prod.
As of 2025, if you’re a Missouri resident, you won’t pay a single dime in capital gains taxes at the state level on profits from stocks, real estate, or crypto.
Yep. You read that right. No tax man coming for your investment wins. Just a clean break. How did we get here?
Before this new law, Missouri taxed capital gains like regular ol’ income — up to 4.7%, depending on your tax bracket. So whether you were flipping homes, selling off that Apple stock you bought during the iPod era, or finally unloading your crypto bag after HODLing since 2017, the state wanted a piece.
No more.
A handful of states — think Florida, Texas, Nevada — already don’t tax any personal income, so naturally capital gains are in the clear there. But Missouri? It’s in a different category. This isn’t a no-income-tax state. It’s one that looked at capital gains specifically and said, “Nah, we’re good.”
That makes this a first-of-its-kind move. It’s targeted, it’s bold, and it’s potentially game-changing.
Why? Because this could be the beginning of something bigger. By zeroing out capital gains for individuals, Missouri is basically hanging a big, flashing sign that says: “Invest here. Live here. Grow here.”
Think of it like this:
- That real estate developer weighing between Kansas City and Denver? He’s looking real hard at Missouri now.
- That startup founder debating when to liquidate shares? She just found a way to save serious cash.
- That crypto trader finally ready to cash out? Missouri just rolled out a digital red carpet.
But who really benefits? Let’s keep it real: 80% of the financial benefit from this bill is expected to go to the top 5% of earners. So yes, it will favor the wealthy. Indeed, critics are already worried about the loss in state revenue — somewhere between $260M and $600M annually. That’s money that funds schools, roads, and public services.
But here’s the counterpunch: If the move spurs economic growth, pulls in new businesses, and juices up investment in-state, it could pay for itself in the long haul. That’s the bet Missouri’s making.
There’s also some crucial fine print. Specifically, this exemption is only for individuals, not corporations. At least for now. Businesses might get in on the fun once Missouri’s top individual income tax rate drops to 4.5%. But that won’t happen until at least 2028, if revenue keeps rising.
So what could/should you actually do with this info? Here are a few options:
- Re-think residency: If you’re in a high-tax state and sitting on major gains, moving to Missouri might suddenly look a lot more appealing.
- Time your exits: Planning to cash out on an investment? You now have a major incentive to do so while under Missouri’s tax umbrella.
- Get your CPA on speed dial: Tax strategies just changed in a big way. Whether a crypto investor or real estate pro, your accountant needs to be looped in.
Big picture. Should you care?
If you invest, yes.
If you’re eyeing a real estate flip or a startup exit, double yes.
If you’re a casual observer wondering how states compete in a post-remote world — definitely.
Missouri’s trying to build it, attract it, and ride it.
The question is: Will people show up to the Show-Me State?
— Branden
