Minnesota

Minnesota top income tax rate is 9.85% on Minnesota taxable income above $304,970 (MFJ, TY2025)

“Subd. 2c. Schedules of rates for individuals, estates, and trusts. (a) The income taxes imposed by this chapter upon married individuals filing joint returns and surviving spouses as defined in section 2(a) of the Internal Revenue Code must be computed by applying to their taxable net income the following schedule of rates: (1) On the first $38,770, 5.35 percent; (2) On all over $38,770, but not over $154,020, 6.8 percent; (3) On all over $154,020, but not over $269,010, 7.85 percent; (4) On all over $269,010, 9.85 percent.”

Note: The rate percentages (5.35%, 6.8%, 7.85%, 9.85%) are fixed in §290.06(2c); the quoted dollar figures are the statutory base-year thresholds, which §290.06 subd. 2d indexes annually. The TY2025 MFJ thresholds published by the Minnesota DOR are $47,150 / $189,070 / $304,970. Minnesota capital gains are taxed as ordinary income at these rates.

Minnesota 1% NII surcharge on investment income above $1,000,000 (all statuses; threshold NOT inflation-adjusted)

“In addition to the taxes imposed under this chapter, for taxable years beginning on or after January 1, 2023, a tax equal to 1 percent of net investment income is imposed on an individual who is a resident of Minnesota and whose net investment income for the taxable year exceeds $1,000,000.”

Note: Net investment income defined as in IRC §1411(c): interest, dividends, capital gains, passive income. Capital gains included dollar-for-dollar. The $1M threshold is the SAME for single, MFJ, and MFS filers (marriage-penalty for dual-income couples above $500K each). Combined top MN rate on CG above $1M: 9.85% + 1% = 10.85%.

Minnesota 1% NII surcharge on investment income above $1,000,000 (all statuses; threshold NOT inflation-adjusted)

“In addition to the taxes imposed under this chapter, for taxable years beginning on or after January 1, 2023, a tax equal to 1 percent of net investment income is imposed on an individual who is a resident of Minnesota and whose net investment income for the taxable year exceeds $1,000,000.”

Note: Net investment income defined as in IRC §1411(c): interest, dividends, capital gains, passive income. Capital gains included dollar-for-dollar. The $1M threshold is the SAME for single, MFJ, and MFS filers (marriage-penalty for dual-income couples above $500K each). Combined top MN rate on CG above $1M: 9.85% + 1% = 10.85%.

IRC §1212(b): capital losses carry forward only for non-corporate taxpayers; no carryback

“In the case of a taxpayer other than a corporation, if there is a net capital loss for any taxable year: (1) the excess of the net short-term capital loss over the net long-term capital gain for such year shall be a short-term capital loss in the succeeding taxable year, and (2) the excess of the net long-term capital loss over the net short-term capital gain for such year shall be a long-term capital loss in the succeeding taxable year.”

Note: IRC §1212(b) limits non-corporate taxpayers to carrying losses forward only ('succeeding taxable year'). IRC §1212(a), which allows a 3-year carryback, applies only to corporations. For conformity states, the federal carryforward amount flows to the state return unchanged.

MN taxes out-of-state muni bond interest addition per §290.0131, subd. 2; MN bonds exempt

“Interest income on obligations of any state other than Minnesota or a political or governmental subdivision, municipality, or governmental agency or instrumentality of any state other than Minnesota exempt from federal income taxes...is an addition.”

Note: The add-back is expressly limited to non-Minnesota obligations. MN bonds are exempt by negative implication of the statutory text.

MN taxes out-of-state muni bond interest addition per §290.0131, subd. 2; MN bonds exempt

“Interest income on obligations of any state other than Minnesota or a political or governmental subdivision, municipality, or governmental agency or instrumentality of any state other than Minnesota exempt from federal income taxes...is an addition.”

Note: The add-back is expressly limited to non-Minnesota obligations. MN bonds are exempt by negative implication of the statutory text.

Minnesota does not conform to IRC §1400Z-2 QOZ gain deferral and exclusion

“Subd. 22. Qualified opportunity zone investments. A taxpayer must add back the amount of any gain deferred under section 1400Z-2(a) of the Internal Revenue Code that was excluded from federal taxable income for the taxable year.”

Note: Minnesota Minn. Stat. §290.0131 subd. 22 requires an addback of QOZ gain deferrals; §290.0133 subd. 17 provides a subtraction only when gain is ultimately recognized. Net effect: Minnesota taxes the deferred gain in the year of QOF investment, not in the year of recognition.

Minnesota partially conforms to IRC §1202 QSBS exclusion; addback applies to stock acquired after July 4, 2025

“Net income means federal adjusted gross income...adjusted for the following additions and subtractions...For taxable years beginning after December 31, 2025, an addition is required for the amount excluded from federal gross income under section 1202 of the Internal Revenue Code for gains on the sale of qualified small business stock acquired after July 4, 2025.”

Note: Quote comes from 2026 Minn. Laws Ch. 128 (enrolled session law amending Minn. Stat. §290.01 subd. 19). Base statute at https://www.revisor.mn.gov/statutes/cite/290.01. Minnesota conforms to pre-H.R.1 IRC §1202 but the 2026 budget bill added an addback for §1202 exclusions on stock acquired after July 4, 2025 (the H.R.1 expanded exclusion). Stock acquired before July 4, 2025 retains the federal exclusion under Minnesota law.

Minnesota subtraction for U.S. obligation interest requires exemption under federal law; FNMA and FHLMC have no such bondholder exemption

“Net interest income on obligations of any authority, commission, or instrumentality of the United States to the extent includable in taxable income for federal income tax purposes, but exempt from state income tax under the laws of the United States, is a subtraction.”

Note: Minn. Stat. §290.0132 subd. 2 subtracts U.S. obligation interest only when it is exempt from state tax under federal law. FNMA and FHLMC are federally chartered but their obligations carry no federal bondholder exemption, so that interest stays in the Minnesota base. The catalog id retains the earlier §290.0133 subd. 5 label; the subtraction is codified at §290.0132 subd. 2.

Minnesota top income tax rate is 9.85% on Minnesota taxable income above $304,970 (MFJ, TY2025)

“Subd. 2c. Schedules of rates for individuals, estates, and trusts. (a) The income taxes imposed by this chapter upon married individuals filing joint returns and surviving spouses as defined in section 2(a) of the Internal Revenue Code must be computed by applying to their taxable net income the following schedule of rates: (1) On the first $38,770, 5.35 percent; (2) On all over $38,770, but not over $154,020, 6.8 percent; (3) On all over $154,020, but not over $269,010, 7.85 percent; (4) On all over $269,010, 9.85 percent.”

Note: The rate percentages (5.35%, 6.8%, 7.85%, 9.85%) are fixed in §290.06(2c); the quoted dollar figures are the statutory base-year thresholds, which §290.06 subd. 2d indexes annually. The TY2025 MFJ thresholds published by the Minnesota DOR are $47,150 / $189,070 / $304,970. Minnesota capital gains are taxed as ordinary income at these rates.

U.S. Treasury interest exempt from Minnesota income tax: 31 U.S.C. §3124(a) prohibits state taxation of U.S. government obligations

“Stocks and obligations of the United States Government are exempt from taxation by a State or political subdivision of a State. The exemption applies to each form of taxation that would require the obligation, the interest on the obligation, or both, to be considered in computing a tax.”

Note: 31 U.S.C. §3124(a) preempts state income taxation of U.S. government obligations. Covers T-bills, T-notes, T-bonds, TIPS, and I-bonds. Most states allow a deduction or subtraction by statute cross-referencing this federal preemption.

FHLB and FFCB bond interest exempt from Minnesota income tax: federal enabling statutes mandate state tax exemption

“Any security issued under this chapter by a Federal home loan bank, including the stock thereof, shall be exempt from taxation, except taxes upon real estate, by any State, county, municipality, or local taxing authority.”

Note: 12 U.S.C. §1433 (FHLB) and 12 U.S.C. §2023 (FFCB/Farm Credit Act) both mandate state tax exemption for securities issued under their chapters. Contrasts with FNMA (12 U.S.C. §§1719(e), 1723a(c)) and FHLMC (12 U.S.C. §1455(a)) which have no bondholder exemption statute and whose interest is taxable by income-tax states.

Farm Credit Act: notes, bonds, debentures, and other obligations of Farm Credit Banks are instrumentalities of the United States exempt from all State, municipal, and local taxation

“The mortgages held by the Farm Credit Banks and the notes, bonds, debentures, and other obligations issued by the banks shall be considered and held to be instrumentalities of the United States and, as such, they and the income therefrom shall be exempt from all Federal, State, municipal, and local taxation, other than Federal income tax liability of the holder thereof under the Public Debt Act of 1941 (31 U.S.C. 3124).”

Note: 12 U.S.C. §2023 explicitly covers 'the income therefrom' (i.e., interest payments to bondholders), exempting it from all State and local taxation. The only carve-out is federal income tax on the holder. Parallel to 12 U.S.C. §1433 (FHLB Act), which exempts FHLB securities from state taxation. Together §1433 and §2023 mandate state and local tax exemption for both FHLB and FFCB bond interest. Shared across all jurisdictions: a single object reference satisfies buildCitationIndex() identity check.

IRC §1212(b): capital losses carry forward only for non-corporate taxpayers; no carryback

“In the case of a taxpayer other than a corporation, if there is a net capital loss for any taxable year: (1) the excess of the net short-term capital loss over the net long-term capital gain for such year shall be a short-term capital loss in the succeeding taxable year, and (2) the excess of the net long-term capital loss over the net short-term capital gain for such year shall be a long-term capital loss in the succeeding taxable year.”

Note: IRC §1212(b) limits non-corporate taxpayers to carrying losses forward only ('succeeding taxable year'). IRC §1212(a), which allows a 3-year carryback, applies only to corporations. For conformity states, the federal carryforward amount flows to the state return unchanged.

Minnesota top income tax rate is 9.85% on Minnesota taxable income above $304,970 (MFJ, TY2025)

“Subd. 2c. Schedules of rates for individuals, estates, and trusts. (a) The income taxes imposed by this chapter upon married individuals filing joint returns and surviving spouses as defined in section 2(a) of the Internal Revenue Code must be computed by applying to their taxable net income the following schedule of rates: (1) On the first $38,770, 5.35 percent; (2) On all over $38,770, but not over $154,020, 6.8 percent; (3) On all over $154,020, but not over $269,010, 7.85 percent; (4) On all over $269,010, 9.85 percent.”

Note: The rate percentages (5.35%, 6.8%, 7.85%, 9.85%) are fixed in §290.06(2c); the quoted dollar figures are the statutory base-year thresholds, which §290.06 subd. 2d indexes annually. The TY2025 MFJ thresholds published by the Minnesota DOR are $47,150 / $189,070 / $304,970. Minnesota capital gains are taxed as ordinary income at these rates.

Minnesota estate tax rate schedule

“The tax imposed must be computed by applying to the Minnesota taxable estate the following schedule of rates...Not over $7,100,000: 13 percent; Over $7,100,000 but not over $8,100,000: $923,000 plus 13.6 percent of the excess over $7,100,000; Over $8,100,000 but not over $9,100,000: $1,059,000 plus 14.4 percent of the excess over $8,100,000; Over $9,100,000 but not over $10,100,000: $1,203,000 plus 15.2 percent of the excess over $9,100,000; Over $10,100,000: $1,355,000 plus 16 percent of the excess over $10,100,000.”

Note: Minnesota estate tax rate schedule per Minn. Stat. §291.03. Verbatim text extracted from statute table structure. Graduated rates 13% to 16% confirmed.

Minnesota estate tax: 13% to 16% graduated; $3,000,000 fixed exclusion for deaths in 2020 and thereafter

“For purposes of the tax under this chapter, the Minnesota taxable estate equals the federal taxable estate as provided under section 2051 of the Internal Revenue Code, without regard to whether the estate is subject to the federal estate tax”

Note: Minnesota exclusion is $3,000,000 fixed (effective for deaths in 2020 and thereafter; Minn. Stat. § 291.016). Rate schedule per § 291.03: not over $7.1M = 13%; $7.1M-$8.1M = $923K + 13.6%; $8.1M-$9.1M = $1.059M + 14.4%; $9.1M-$10.1M = $1.203M + 15.2%; over $10.1M = $1.355M + 16%. Additional $2M exclusion for qualifying small business or farm property.

Minnesota estate tax exemption

“An exclusion of $3,000,000 is allowed against the Minnesota taxable estate for decedents dying in 2020 and thereafter.”

Note: Minnesota's estate tax exemption is $3,000,000 fixed for deaths in 2020 and thereafter. Not inflation-adjusted. Additional $2,000,000 exclusion available for qualifying small business or farm property (Minn. Stat. §291.015(b)).

Minnesota estate tax: 13% to 16% graduated; $3,000,000 fixed exclusion for deaths in 2020 and thereafter

“For purposes of the tax under this chapter, the Minnesota taxable estate equals the federal taxable estate as provided under section 2051 of the Internal Revenue Code, without regard to whether the estate is subject to the federal estate tax”

Note: Minnesota exclusion is $3,000,000 fixed (effective for deaths in 2020 and thereafter; Minn. Stat. § 291.016). Rate schedule per § 291.03: not over $7.1M = 13%; $7.1M-$8.1M = $923K + 13.6%; $8.1M-$9.1M = $1.059M + 14.4%; $9.1M-$10.1M = $1.203M + 15.2%; over $10.1M = $1.355M + 16%. Additional $2M exclusion for qualifying small business or farm property.

Minnesota Uniform Disposition of Community Property Rights at Death Act (effective August 1, 2013)

“This chapter may be cited as the 'Uniform Disposition of Community Property Rights at Death Act.'”

Note: Minnesota enacted UDCPRDA in 2013 (2013 c 24, signed April 25, 2013; effective August 1, 2013). Protects the community property character of assets acquired in community property states when a couple moves to Minnesota. At death, the surviving spouse retains their one-half community property interest. Minnesota is not a community property state for income tax purposes.

Minnesota top income tax rate is 9.85% on Minnesota taxable income above $304,970 (MFJ, TY2025)

“Subd. 2c. Schedules of rates for individuals, estates, and trusts. (a) The income taxes imposed by this chapter upon married individuals filing joint returns and surviving spouses as defined in section 2(a) of the Internal Revenue Code must be computed by applying to their taxable net income the following schedule of rates: (1) On the first $38,770, 5.35 percent; (2) On all over $38,770, but not over $154,020, 6.8 percent; (3) On all over $154,020, but not over $269,010, 7.85 percent; (4) On all over $269,010, 9.85 percent.”

Note: The rate percentages (5.35%, 6.8%, 7.85%, 9.85%) are fixed in §290.06(2c); the quoted dollar figures are the statutory base-year thresholds, which §290.06 subd. 2d indexes annually. The TY2025 MFJ thresholds published by the Minnesota DOR are $47,150 / $189,070 / $304,970. Minnesota capital gains are taxed as ordinary income at these rates.

Minnesota conforms to the federal capital-loss base; treatment of an imported pre-residency section 1212 carryforward is a structural inference

“The income taxes imposed by this chapter upon married individuals filing joint returns and surviving spouses as defined in section 2(a) of the Internal Revenue Code must be computed by applying to their taxable net income the following schedule of rates:”

Note: Minn. Stat. §290.06 subd. 2c applies the rate schedule to taxable net income, which flows from federal taxable income under the chapter, so the federal section 1212 capital-loss base carries through. No published guidance addresses the imported pre-residency carryforward; that piece stays a structural inference.