Entrepreneurs in St. Louis, MO: taxes and retirement for 2026

For solo founders and small-business owners in St. Louis, MO. Missouri has a graduated state income tax for 2026: 2% to 4.7% (top rate starts at $9,436 for single filers). St. Louis adds a local income tax. Here are the 2026 rules, a worked example and the official sources.

What's different in St. Louis

Local income tax: City of St. Louis Earnings Tax: 0.01% for residents, 0.01% for nonresidents (effective The earnings tax has been law since 1954; voters approved continuing the 1% tax for another five years on April 7, 2026 (Proposition E)). City residents pay 1% on all earnings, and non-residents pay 1% on earnings from work done in the city. Self-employed people, independent contractors and sole proprietors report and pay the 1% on business net profits with Form E-234, and non-resident businesses split their earnings by a three-factor formula (receipts, property and payroll).
St. Louis Business Earnings Tax (Form E-234): 1% of the net earnings of every business located in, or doing work in, the city, including self-employed people, contract workers and sole proprietors. Non-resident businesses use a three-factor formula (receipts, property and payroll). The return is due April 15 for calendar-year filers (businesses can request an extension to Oct. 15 on Form E-8), and a business must open an earnings tax account (Form E-9) before it starts operating.
St. Louis Payroll Expense Tax: Employers pay 0.5% of wages earned by employees working in the city, filed quarterly on Form P-10. There is no small-employer threshold, but a self-employed person with no employees does not owe it.
St. Louis Graduated Business License: Required for businesses not exempt by law. The fee depends on the number of St. Louis employees and is $200 a year for 0-2 employees.
St. Louis Short-Term Rental Business License (Ord. 72095): Since Feb. 26, 2026, short-term rental operators must hold a Short-Term Rental Business License and pay a 3% license fee each quarter.
City business license: Yes. The License Collector says any person doing business within city limits must have a business license; the city site makes no exception for home-based businesses, and a business located in the city also needs an Occupancy Permit.
Also worth knowing: Rates are decimal fractions (0.01 = 1%). Official April 7, 2026 results: https://www.stlouis-mo.gov/government/departments/board-election-commissioners/elections/election.cfm?customel_datapageid_524494=1216425 (Proposition E passed with about 85% yes). Late individual payments draw a 5% monthly penalty (up to 25%) plus 1% monthly interest, and individuals cannot get filing extensions. Form E-234 (for self-employed and contract workers): https://www.stlouis-mo.gov/government/departments/collector/earnings-tax/documents/e-234-form.cfm. Form E-9 requirement: https://www.stlouis-mo.gov/government/departments/collector/earnings-tax/documents/e-9-form.cfm. We found no local gig-worker pay laws.

Missouri rules for entrepreneurs

State income tax (2026): Missouri has a graduated state income tax for 2026: 2% to 4.7% (top rate starts at $9,436 for single filers). 2026 brackets: the first $1,348 of taxable income is taxed at 0%, then rates run from 2.0% up to 4.7% on taxable income over $9,436. The same brackets apply to every filing status. A legislative constitutional amendment to phase out the income tax (HJR 173/174, Amendment 5) appeared on the August 4, 2026 primary ballot (sos.mo.gov) and was defeated by voters, so 2026 rates are unchanged.
State estimated tax: You must file a declaration and pay estimated tax if your Missouri estimated tax (after withholding and credits) is expected to be $100 or more (Section 143.521.1, RSMo). Same dates as federal (April 15, June 15, September 15, January 15). Farmers may pay by January 15, or file and pay in full by March 1. Form MO-1040ES.
Unemployment right-to-control test (RSMo 288.034.5): Missouri unemployment law uses the common-law right-to-control test. If the business controls the manner and means of the work, the worker is an employee; if it controls only the results, the worker is an independent contractor. Some licensed real estate agents and direct sellers paid on output under a written contract are excluded.
Rideshare (TNC) driver contractor status (RSMo 387.414): Rideshare drivers are independent contractors, not employees, if the company does not set required logged-in hours, does not bar them from other rideshare apps, does not restrict other work, and both sides agree in writing that the driver is a contractor. In effect since August 28, 2017.
State retirement program: Show-Me MyRetirement Savings Plan is live. It is built around W-2 employers and does not cover 1099 contractors through the employer mandate.

Federal rules for 2026

Entity choice changes your taxes

A single-member LLC is taxed like a sole proprietorship unless it elects S-corp status. The S-corp can lower payroll tax but adds payroll, a separate return and a reasonable-salary requirement.

Retirement as a tax lever

With no employees, a Solo 401(k) allows up to $72,000 in 2026. With employees, a SEP IRA or a 401(k) must generally cover eligible staff too.

Quarterly estimated taxes

No one withholds tax from self-employment income, so you generally pay estimates four times a year if you expect to owe $1,000 or more. For 2026 income the federal dates are April 15, June 15 and September 15, 2026, and January 15, 2027. Paying 100% of last year's tax (110% if your AGI was over $150,000) in four equal installments avoids the underpayment penalty.

Self-employment tax

On top of income tax, self-employed people pay 15.3% on 92.35% of net profit: 12.4% Social Security up to the 2026 wage base of $184,500, plus 2.9% Medicare with no cap. Half of it is deductible.

A worked example

A solo founder with $200,000 of profit in 2026
Self-employment tax as a sole proprietor	$28,234
Solo 401(k) maximum as a sole proprietor	$61,677
Payroll tax saved as an S-corp on a $100,000 salary	$12,934
Solo 401(k) maximum as that S-corp	$49,500

Federal figures only. S-corps add running costs (payroll, an 1120-S return, state fees) not shown here. Computed from 2026 IRS limits (Notice 2025-67, Rev. Proc. 2025-32) and the SSA wage base.

Free tools

S-corp vs Solo 401(k) calculator Solo 401(k) vs SEP IRA calculator Quarterly tax calculator

Guides by job and platform

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Questions

Is there a local income tax in St. Louis?

Yes. City of St. Louis Earnings Tax is 0.01% for residents and 0.01% for nonresidents (effective The earnings tax has been law since 1954; voters approved continuing the 1% tax for another five years on April 7, 2026 (Proposition E)). City residents pay 1% on all earnings, and non-residents pay 1% on earnings from work done in the city. Self-employed people, independent contractors and sole proprietors report and pay the 1% on business net profits with Form E-234, and non-resident businesses split their earnings by a three-factor formula (receipts, property and payroll).

What local business taxes apply to self-employed entrepreneurs in St. Louis?

St. Louis Business Earnings Tax (Form E-234): 1% of the net earnings of every business located in, or doing work in, the city, including self-employed people, contract workers and sole proprietors. Non-resident businesses use a three-factor formula (receipts, property and payroll). The return is due April 15 for calendar-year filers (businesses can request an extension to Oct. 15 on Form E-8), and a business must open an earnings tax account (Form E-9) before it starts operating. St. Louis Payroll Expense Tax: Employers pay 0.5% of wages earned by employees working in the city, filed quarterly on Form P-10. There is no small-employer threshold, but a self-employed person with no employees does not owe it. St. Louis Graduated Business License: Required for businesses not exempt by law. The fee depends on the number of St. Louis employees and is $200 a year for 0-2 employees. St. Louis Short-Term Rental Business License (Ord. 72095): Since Feb. 26, 2026, short-term rental operators must hold a Short-Term Rental Business License and pay a 3% license fee each quarter.

Do I need a business license to freelance from home in St. Louis?

Yes. The License Collector says any person doing business within city limits must have a business license; the city site makes no exception for home-based businesses, and a business located in the city also needs an Occupancy Permit.

Do entrepreneurs in Missouri pay state income tax?

Missouri has a graduated state income tax for 2026: 2% to 4.7% (top rate starts at $9,436 for single filers). 2026 brackets: the first $1,348 of taxable income is taxed at 0%, then rates run from 2.0% up to 4.7% on taxable income over $9,436. The same brackets apply to every filing status. A legislative constitutional amendment to phase out the income tax (HJR 173/174, Amendment 5) appeared on the August 4, 2026 primary ballot (sos.mo.gov) and was defeated by voters, so 2026 rates are unchanged.

When are Missouri estimated tax payments due for 2026?

You must file a declaration and pay estimated tax if your Missouri estimated tax (after withholding and credits) is expected to be $100 or more (Section 143.521.1, RSMo). Same dates as federal (April 15, June 15, September 15, January 15). Farmers may pay by January 15, or file and pay in full by March 1. The state form is MO-1040ES.

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Sources

State and local facts researched from official sources and independently re-checked; last verified October 2026, next scheduled review 2027-01-02. Educational information for 2026, not tax, legal or investment advice. Rules change; check the official sources listed and a tax professional for your situation. Gigaverse AI, Inc. is a financial technology company, not a bank, and not itself a registered investment adviser or broker-dealer.