Minnesota has a 4-bracket progressive income tax with rates of 5.35%, 6.8%, 7.85%, and 9.85% (top rate). At $100K income, most Minnesotans pay an effective rate of 5.2% ($5,222 state tax). The 9.85% top rate applies to income over $203,150 for single filers, making Minnesota the 3rd-highest-taxed state nationally (only California 13.3% and Hawaii 11% have higher top rates).
The Minnesota tax philosophy - high taxes, high services: Minnesota consciously chooses higher taxes to fund excellent public services. MN ranks #1 nationally in healthcare outcomes, #8 in K-12 education, #2 in infrastructure quality, and has the 2nd-lowest poverty rate. Residents accept high taxes because they receive tangible benefits: top-rated schools, excellent healthcare access, well-maintained roads, strong social safety net. This "you get what you pay for" model distinguishes MN from low-tax states with weaker services.
How it compares regionally:
Minnesota's 2026 brackets (single filers):
Source: Minnesota Department of Revenue - Individual Income Tax
Note: These are marginal rates — you only pay the higher rate on income within each bracket.
Source: Minnesota Department of Revenue
Here's what Minnesota residents actually pay at different income levels (2026, single filer, standard deduction):
| Annual Income | Federal Tax | State Tax | Total Tax | Take-Home Pay | Effective Rate |
|---|---|---|---|---|---|
| $50,000 | $3,820 | $1,822 | $5,642 | $44,358 | 11.3% |
| $75,000 | $7,670 | $3,522 | $11,192 | $63,808 | 14.9% |
| $100,000 | $13,170 | $5,222 | $18,392 | $81,608 | 18.4% |
| $150,000 | $24,734 | $8,879 | $33,613 | $116,387 | 22.4% |
| $250,000 | $51,304 | $17,344 | $68,648 | $181,352 | 27.5% |
Note: Includes federal and state income tax only. Does not include FICA (Social Security/Medicare), which adds 7.65% for employees.
Key takeaway: At $100K, Minnesota takes $5,222 in state tax alone.
CountryTaxCalc.com is reader-supported. When you use our partner links, we may earn a commission at no cost to you. This helps us provide free tax calculators and comparison tools. Learn more about our affiliate partnerships
★ 4.8 verified reviews · 3,758 reviews
Planning a move to or from Minnesota? Multi-state filing is complex. Get matched with a CPA who handles Minnesota taxes and multi-state returns. Virtual meetings, fixed pricing.
⚠ Not for simple single-state returns. Free filing is fine for straightforward W-2 situations.
Get Matched With a CPA →Interested in reaching this audience? Advertise on CountryTaxCalc →
Migration Trends: According to U.S. Census Bureau data (2021-2022), Minnesota experienced modest net immigration of 2,145 residents. Top origin states were:
Outflow: Minnesota lost residents to lower-tax states:
Why people move to Minnesota (quality over savings):
Why people leave Minnesota:
Tax considerations if moving here:
| State | Tax Rate | Tax on $100K Income | Difference from Minnesota |
|---|---|---|---|
| Minnesota | 5.35-9.85% | $5,222 | Baseline |
| South Dakota | 0% | $0 | −$5,222 (save) |
| North Dakota | 0-1.95% | $691 | −$4,531 (save) |
| Wisconsin | 3.5-7.65% | $3,860 | −$1,362 (save) |
| Iowa | 3.8% flat | $3,188 | −$2,034 (save) |
Key insight: Minnesota has the highest taxes among all neighboring states. At $100K income, MN residents pay $1,362-$5,222 more than neighbors. At $150K, MN pays more still. The question: are MN's excellent public services worth 1-5% higher taxes?
The South Dakota arbitrage - massive savings but tradeoffs:
The Wisconsin border strategy (Hudson WI):
Bottom line: Minnesota's "high tax, high service" value proposition:
Result: Minnesota's high taxes are justified IF you value education, healthcare, infrastructure. If you prioritize tax savings over services, move to SD/WI/TX/FL. At $100K+, the $2K-5K extra annual tax buys measurably better public goods.
Minnesota's 9.85% top rate (3rd-highest nationally) funds excellent public services that measurably outperform low-tax states. MN ranks #1 nationally in healthcare outcomes (lowest uninsured rate 4.3%, top patient care quality), #8 in K-12 education (81% high school graduation vs 77% national avg, #3 in reading/math scores), #2 in infrastructure quality (well-maintained roads, bridges, public transit), #5 in economic opportunity, and has the 2nd-lowest poverty rate (8.7% vs 11.5% national). Residents accept high taxes because they receive tangible ROI: top schools, excellent healthcare, safe neighborhoods, strong social safety net. This contrasts with low-tax states like TX (0% income tax but #43 healthcare, #41 education, 1.6% brutal property tax).
It depends on your income source and priorities. South Dakota has 0% income tax (save $5,222/year at $100K, ~$12,804 at $200K). But: Sioux Falls SD (200K metro) vs Twin Cities MN (3.7M metro) - job market 18x smaller. SD median income $63K vs MN $84K (earn $21K less on average). SD K-12 ranks #31 vs MN #8. Best for: remote workers/retirees not dependent on SD job market, willing to sacrifice services (schools, healthcare, culture) for tax savings. Not ideal for: families with kids (education suffers), professionals needing robust job market, people who value urban amenities. Break-even: If you earn $150K+ working remotely and can live in Sioux Falls, save $8K+/year. If you need Twin Cities job market, MN's taxes are worth paying.
Yes, and savings are now more significant. Hudson WI is 30 min to St. Paul, 45 min to Minneapolis. At $100K income working in MN while living in WI: pay $3,860 WI state tax vs $5,222 MN tax = save $1,362/year. At $200K: save ~$4,382/year. Wisconsin has full reciprocity with Minnesota for wage withholding but you still pay WI tax on all income as a WI resident. Trade-offs: Commute 60-90 min/day (vs living in Twin Cities), smaller town life (Hudson 14K pop), lose MN city amenities (theaters, restaurants, culture). Worth it if: You value suburban/small-town life and $2K-4K savings, don't mind commute. Not worth it if: You want urban lifestyle, the savings don't justify commute time/lifestyle sacrifice.
Partially. Social Security: Exempt if single income under $82,190 or married under $105,380 (2026 thresholds). Above these thresholds, SS is partially taxable (not all states exempt SS - CA/MA tax it fully). Pension/401k: Fully taxable at 5.35-9.85% rates, but MN offers subtraction for some pensions (varies by type). At typical retiree income ($40K SS + $40K pension = $80K total): SS fully exempt (under threshold), pension taxed = ~$4,400 MN tax. This is higher than 0% tax states (FL/TX/TN/SD $0) but higher than CA ($4,241) — MN now costs more than CA at this income level. MN also has no estate or inheritance tax. Overall: MN is moderate for retirees - not the worst, not the best. Best for retirees who value healthcare (#1 nationally) and are willing to pay 4-6% tax on pensions/401k for excellent medical care access.
Minnesota's property tax (1.08% average) is above national (0.99%) and sales tax (8.875% max) is moderate. At $100K income with $330K Twin Cities home: $5,222 state income + $3,564 property (1.08%) + $4,438 sales (8.875% on $50K spending) = $13,224 total state/local tax (13.2% of income). Compare to Texas at $100K with $330K home: $0 income + $5,280 property (1.6%!) + $4,100 sales (8.2%) = $9,380 total (9.4%). TX saves $5,017/year BUT: TX ranks #43 healthcare vs MN #1, TX #41 education vs MN #8. Compare to California at $100K with $330K home: $4,241 income + $2,442 property (0.74%) + $3,625 sales (7.25%) = $10,308 total (10.3%). MN pays $2,916 more than CA but gets better schools (#8 vs #21) and lower cost of living ($330K home vs $780K CA). Bottom line: MN's total burden is high (14-15%) but not the highest (CA/NY/NJ are 15-18% at $100K). You're paying for #1 healthcare and top-10 education.
Effective rates, what the headline hides, 111+ countries. Every two weeks, free.
Bi-weekly. No spam. Unsubscribe in one click.
How we calculate: Minnesota uses a 4-bracket progressive tax system. We calculate tax by applying rates to income in each bracket: 5.35% on first $33,310, 6.8% on $33,310-$109,430, 7.85% on $109,430-$203,150, 9.85% on income over $203,150. We subtract the Minnesota standard deduction ($16,100 for single filers in 2026, higher than federal) and apply federal tax using official 2026 IRS brackets. Effective rates are calculated by dividing total tax by gross income.
Data sources:
Verification: Minnesota's 4-bracket structure and 9.85% top rate verified against Minnesota Statutes Chapter 290 (Income Tax) and MN Department of Revenue 2026 tax guidance published January 2026. Brackets and standard deduction ($16,100 single) verified against official 2026 forms. Service rankings verified against US News & World Report state rankings (healthcare #1, education #8). Migration data from IRS SOI Tax Stats via Census Bureau.
Limitations: Assumes single filer, standard deduction, W-2 income only, full-year MN residency. Does not include: itemized deductions, Minnesota-specific subtractions (K-12 education expenses, college savings contributions, Social Security over-taxation relief), federal credits, property tax (1.08% avg), sales tax (8.875% max), part-year/nonresident calculations.
For complex situations: Consult a licensed Minnesota CPA, especially for: Social Security taxation (complex thresholds $82,190 single/$105,380 married), pension subtractions, part-year residency, Wisconsin border commuters (reciprocity rules), K-12 education expense deductions, 529 plan subtractions.
Last Updated: May 2026
Verified By: Daniel · CountryTaxCalc
Contact: For corrections or questions, visit our contact page.
Last Updated: May 2026