Minnesota's lowest rate is 5.35% — higher than the top rate in 22 other states. There is no gentle entry band here; the first taxable dollar is taxed at a rate most states reserve for high earners.
| Gross pay | — |
| Federal income tax | — |
| Social Security6.2% up to $184,500 | — |
| Medicare1.45%, no cap | — |
| State income tax | — |
| 401(k) contribution | — |
| Health and HSA | — |
Useful if you are comparing a job that pays monthly against one that pays every two weeks, or working out what a raise is worth per paycheck.
| Pay schedule | Gross | Take-home |
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Minnesota's four rates are 5.35%, 6.8%, 7.85% and 9.85%. That opening rate is the second-highest in the country, behind only Maine's 5.80%, and it is the defining feature of the Minnesota code — more so than the top rate, which few people reach.
The comparison with North Dakota next door is stark. A North Dakotan pays nothing on the first $48,475 of taxable income; a Minnesotan pays 5.35% from the first dollar above the standard deduction. For someone earning $40,000 that difference runs well over a thousand dollars a year, for two people doing the same job either side of the Red River.
The 6.8% band begins at $33,310 for a single filer, which most full-time workers clear, so the operative rate for a typical Minnesota salary is 6.8% or 7.85%.
Minnesota partly offsets those rates with a standard deduction of $15,300 for a single filer and $30,600 for a couple — close to federal levels — plus a $5,300 exemption for each dependent.
That dependent figure is among the largest in the country. At the 6.8% band it is worth about $360 per child in reduced tax, which for a family of four materially changes the picture.
The deduction does phase down for higher earners, reduced by a percentage of income above roughly $244,400. This calculator applies the full amount and therefore reads slightly low in that range.
This is unusual and worth knowing before retiring here. Minnesota is one of the small number of states that includes Social Security benefits in taxable income, though it provides a subtraction that removes the benefit entirely for lower and middle-income recipients and phases out above set thresholds.
For a retiree with a pension, retirement account withdrawals and Social Security combined, Minnesota is one of the more expensive states in the country. For a working-age earner it never arises.
No Minnesota city or county levies an income tax, including Minneapolis and St. Paul. The state figure shown here is the complete income tax picture, which is not true of neighbouring Iowa or of Wisconsin's other neighbours.
Minnesota also applies a 1% surtax on net investment income above $1 million, which does not touch wages.
Yes. The 5.35% bottom bracket exceeds the top marginal rate in 22 states, including Arizona, Ohio, Indiana, Pennsylvania, North Dakota and Idaho. Only Maine opens higher, at 5.80%.
It includes benefits in taxable income but provides a subtraction that eliminates the tax for lower and middle-income recipients, phasing out above set thresholds. Most states exempt Social Security outright.
$5,300 per dependent, among the largest in the country, subtracted from income before the rates apply.
No. No Minnesota municipality levies one.