State Income Tax

Income Tax in Minnesota: Complete Guide 2026

Updated 2026-03-10

Data Notice: Figures, rates, and statistics cited in this article are based on the most recent available data at time of writing and may reflect projections or prior-year figures. Always verify current numbers with official sources before making financial, medical, or educational decisions.

Income Tax in Minnesota: Complete Guide 2026

Tax information is for educational purposes only and does not constitute tax advice. Consult a licensed tax professional for your specific situation.

Minnesota has one of the highest top marginal income tax rates in the nation at ~9.85%, applied to taxable income exceeding ~$193,240 for single filers. The state uses a four-bracket graduated system, with rates starting at ~5.35%. While these rates are among the steepest in the country, Minnesota offsets some of the burden with relatively generous deductions, credits, and exemptions for families, renters, and lower-income earners.

Minnesota Income Tax Rates (2026)

Single Filers

Taxable IncomeRate
$0 — ~$31,690~5.35%
~$31,691 — ~$104,090~6.80%
~$104,091 — ~$193,240~7.85%
Over ~$193,240~9.85%

Married Filing Jointly

Taxable IncomeRate
$0 — ~$46,330~5.35%
~$46,331 — ~$183,710~6.80%
~$183,711 — ~$321,450~7.85%
Over ~$321,450~9.85%

How Minnesota Income Tax Works

Graduated Bracket System

Minnesota’s four brackets tax income progressively. Your first dollars of taxable income are taxed at ~5.35%, with each successive bracket taxing additional income at a higher rate. Only the income within each bracket is taxed at that bracket’s rate, so your effective rate is always lower than your marginal rate.

Standard Deduction vs. Itemized Deductions

Minnesota offers both a standard deduction and the option to itemize:

Filing StatusStandard Deduction
Single~$14,575
Married filing jointly~$29,150
Head of household~$21,900

If you itemize, Minnesota generally follows federal itemized deduction rules with some modifications. Notably, Minnesota does not allow a deduction for state income taxes paid (to avoid circular deductions), and certain federal deductions may be added back.

Personal and Dependent Exemptions

Minnesota does not use traditional personal exemptions. Instead, the standard deduction and various credits serve the same function of reducing tax on lower levels of income.

Retirement Income

Minnesota taxes most forms of retirement income, including pensions, 401(k) distributions, and IRA withdrawals. However, the state adopted a Social Security subtraction: filers can subtract a portion or all of their Social Security benefits depending on income. For 2026, single filers with provisional income under ~$78,000 and joint filers under ~$100,000 may fully subtract Social Security income.

Key Minnesota Tax Credits

  1. Working Family Credit: Minnesota’s version of the EITC, providing a refundable credit of up to ~$2,640 for families with qualifying children.
  2. Child Tax Credit: Up to ~$1,750 per qualifying child for families meeting income thresholds.
  3. K-12 Education Credit: Up to ~$1,625 per child for qualifying education-related expenses for children in grades K-12.
  4. Property Tax Refund (Renter’s Credit): Renters with household income under ~$69,520 may claim a refund based on rent constituting property tax.
  5. 529 Plan Credit/Deduction: Contributions to a Minnesota 529 plan may qualify for a credit of up to ~$500 or a deduction depending on income level.

Who Must File in Minnesota

You must file a Minnesota return (Form M1) if:

  • You are a resident with gross income exceeding the filing threshold (generally the standard deduction amount)
  • You are a part-year resident or nonresident with Minnesota-source income
  • You owe Minnesota alternative minimum tax
  • You want to claim a refund of Minnesota withholding

The filing deadline matches the federal date, typically April 15.

Comparison to National Average

StateTop Income Tax RateBrackets
Minnesota~9.85%4
Wisconsin~7.65%4
Iowa~5.70%4
North Dakota~2.50%2
South Dakota0%None
National average~4.60%Varies

Minnesota’s top rate is among the highest in the nation, trailing only California and a handful of other states. Neighboring states like South Dakota and North Dakota have dramatically lower rates, which sometimes influences high-income earners’ residency decisions.

Tips for Minimizing Minnesota Income Tax

  1. Maximize retirement contributions. Traditional 401(k) and IRA contributions reduce federal AGI, which directly lowers Minnesota taxable income.

  2. Claim the Social Security subtraction. If your income falls below the phase-out thresholds, you can fully exclude Social Security benefits from Minnesota taxation.

  3. Use the K-12 Education Credit. Qualifying expenses for children in kindergarten through 12th grade can generate a credit of up to ~$1,625 per child.

  4. Contribute to a Minnesota 529 plan. Lower-income filers can receive a credit up to ~$500, while higher-income filers benefit from a deduction.

  5. File for the Property Tax Refund. Both homeowners and renters can claim this refund separately from their income tax return using Form M1PR.

  6. Review your itemized deductions. Minnesota’s high standard deduction means itemizing is beneficial only if your qualifying deductions exceed ~$14,575 (single) or ~$29,150 (joint).

  7. Consider timing of income. If you are near a bracket threshold, deferring income or accelerating deductions can keep you in a lower bracket.

Key Takeaways

  • Minnesota has four income tax brackets with rates from ~5.35% to ~9.85%, one of the highest top rates in the country.
  • There are no local income taxes, so the state rate is the only income tax burden.
  • Social Security benefits can be partially or fully subtracted from Minnesota taxable income based on your income level.
  • The Working Family Credit and Child Tax Credit provide significant relief for families.
  • The K-12 Education Credit is unique among states and can save up to ~$1,625 per child annually.
  • Minnesota’s Property Tax Refund applies to both homeowners and renters.

Next Steps