Does Minnesota tax Social Security? Retirement income rules
Minnesota is less tax-friendly for retirees. On a typical retirement income it ranks #44 of 51 for the lowest state income tax.
Assumptions behind this comparison
The ranking uses a full-year resident, single filer age 67, with $30,000 Social Security, $20,000 private defined-benefit pension, $20,000 traditional IRA withdrawals under 2026 rules. It models a general private pension and traditional IRA withdrawals. Public or military pension exceptions, early-distribution penalties and itemized deductions require separate checking. Maryland and Indiana estimates include an approximate statewide-average county income tax; other local income taxes are not modeled. A state with no income tax differs from a state that exempts only specified retirement income.
The joint table uses two spouses age 67, with each income category split equally between them. Personal exclusions follow each spouse's own eligible income; some states instead allow a joint cap. The calculator initially assigns household income to you and lets you enter your spouse's actual age and share. Read the source instructions for your pension type.
The rules in Minnesota
- Social Security: Under the simplified method, Social Security is fully exempt if federal AGI is $86,410 or less (single or head of household) or $110,780 or less (married filing jointly) in 2026. Above that, the subtraction shrinks by 10% for each $4,000 of AGI or part of $4,000. Minnesota allows the greater of that amount and an alternative subtraction based on provisional income. The alternative starts at up to $4,560 single or $5,840 joint and falls by 20% of provisional income above $69,250 single or $88,630 joint, limited to federally taxable benefits. The calculator compares both methods for the taxable income entered; tax-exempt interest and railroad benefits are not inputs.
- Pensions: Private pensions are taxed as ordinary income at Minnesota's 5.35% to 9.85% rates. A public pension subtraction for 2026 allows public retirees up to $13,850 per filer ($27,690 joint), phasing out above the same income levels as the Social Security subtraction. A small elderly or disabled exclusion applies only at very low incomes. Military retirement pay is fully subtracted.
- 401(k), 403(b) and IRA withdrawals: 401(k) and IRA withdrawals are taxed as ordinary income at Minnesota's regular rates.
- At 65 and older: Filers 65 or older add $2,000 to the standard deduction for 2026 ($1,600 per spouse on a joint return).
Calculate your Minnesota retirement taxes
State income tax in Minnesota: $1,214 a year
In Minnesota, qualifying employer-plan withdrawals can receive the pension exclusion while traditional IRA withdrawals do not. Keep each account in its own field when changing state; the calculator applies the state-specific treatment.
The employer-plan field supports federally taxable private 401(k) / 403(b) retirement distributions owned by someone aged 60 or older. Earlier distributions and Hawaii, Mississippi or Pennsylvania employer-plan scenarios are not calculated; funding or plan retirement eligibility needs a separate check. Enter each amount once; do not include completed rollovers, Roth payments or special public/military plans.
Older shared links did not identify employer-plan withdrawals separately. Pension and IRA amounts have been left unchanged. If an old amount includes 401(k) or 403(b) withdrawals, move that portion into the employer-plan field before comparing states; the tool cannot infer the original account type.
Household totals include taxable private pensions and traditional retirement withdrawals. Other ordinary income means taxable interest and ordinary dividends; capital gains, qualified dividends, tax-exempt interest, wages, Roth distributions and special public or military pension rules need a separate calculation. Disability and survivor eligibility are not assessed by this tool. Age bands represent the listed ages for the full year; midyear eligibility and birth-date exceptions need checking.
Local income taxes are not modeled here, except the approximate statewide-average county rates included when you select Maryland or Indiana.
In Minnesota you'd pay about $1,214 in state income tax and $4,336 in federal income tax on $70,000 of retirement income, keeping $64,450 (7.9% total).
Minnesota ranks #44 of 51 for the lowest state tax on this income. 19 states charge no state income tax on this income.
What retirees pay in Minnesota
| Retirement income | State tax (single) | State tax (married) | Federal tax (single) |
|---|---|---|---|
| $24,000 Social Security, $12,000 traditional IRA withdrawals | $0 | $0 | $0 |
| $30,000 Social Security, $20,000 private defined-benefit pension, $20,000 traditional IRA withdrawals | $1,214 | $332 | $4,336 |
| $40,000 Social Security, $40,000 private defined-benefit pension, $50,000 traditional IRA withdrawals, $10,000 other income | $7,529 | $5,183 | $19,812 |
Age 67, 2026 rules including the federal senior deduction. For the joint column, income is the household total, both spouses are 67, and each owns 50% of every income category. State estimates apply Minnesota's main exclusions and may differ for income-tested credits.
Lower-tax states for the age-67 example
The amounts below use the fixed example above. Comparison links carry the last valid household entered in the calculator, including each spouse's income and age; the destination recalculates that household. Finish correcting invalid entries before using a comparison.
Moving to Minnesota in retirement?
Compare the tax on your Social Security, pension and 401(k)/IRA income, and typical living costs, with the state you'd leave. These are the states most households moving to Minnesota come from (IRS migration data, 2022–2023).
- Wisconsin to Minnesota
- North Dakota to Minnesota
- California to Minnesota
- Texas to Minnesota
- Florida to Minnesota
- Iowa to Minnesota
Frequently asked questions
Does Minnesota tax Social Security?
Partly taxed. Under the simplified method, Social Security is fully exempt if federal AGI is $86,410 or less (single or head of household) or $110,780 or less (married filing jointly) in 2026. Above that, the subtraction shrinks by 10% for each $4,000 of AGI or part of $4,000. Minnesota allows the greater of that amount and an alternative subtraction based on provisional income. The alternative starts at up to $4,560 single or $5,840 joint and falls by 20% of provisional income above $69,250 single or $88,630 joint, limited to federally taxable benefits. The calculator compares both methods for the taxable income entered; tax-exempt interest and railroad benefits are not inputs.
Does Minnesota tax pensions?
Taxed. Private pensions are taxed as ordinary income at Minnesota's 5.35% to 9.85% rates. A public pension subtraction for 2026 allows public retirees up to $13,850 per filer ($27,690 joint), phasing out above the same income levels as the Social Security subtraction. A small elderly or disabled exclusion applies only at very low incomes. Military retirement pay is fully subtracted.
Does Minnesota tax 401(k) and IRA withdrawals?
Taxed. 401(k) and IRA withdrawals are taxed as ordinary income at Minnesota's regular rates.
Is Minnesota a good state to retire for taxes?
For a single retiree with $30,000 Social Security, $20,000 private defined-benefit pension, $20,000 traditional IRA withdrawals, Minnesota charges about $1,214 in state income tax, ranking #44 of 51 (lowest tax first).
Related
Sources: house.mn.gov, revenue.state.mn.us, revenue.state.mn.us (2), revisor.mn.gov, revenue.state.mn.us (3). Rules reviewed .