Key Takeaways
- Minnesota's top income tax rate is 9.85%—highest in the Midwest
- MN has a strict 183-day statutory residency test
- Minnesota Revenue actively audits departing high-income residents
- Snowbirds must carefully track days to avoid MN taxation
Overview: Minnesota's Tax Burden
Minnesota has the highest income tax rate in the Midwest at 9.85%. Combined with cold winters, many Minnesotans are establishing Florida residency. However, Minnesota Revenue has an aggressive audit program.
$5,000 - $30,000+
Annual savings depending on income level
Minnesota Tax Rates (2024)
| Taxable Income (Single) | Tax Rate |
|---|---|
| $0 - $30,070 | 5.35% |
| $30,071 - $98,760 | 6.80% |
| $98,761 - $183,340 | 7.85% |
| Over $183,340 | 9.85% |
Savings Examples
- $100,000 income: Save ~$5,500/year
- $150,000 income: Save ~$9,200/year
- $200,000 income: Save ~$13,500/year
- $300,000 income: Save ~$23,500/year
Minnesota Residency Rules
Minnesota uses both domicile and statutory residency tests:
Domicile Test
Minnesota considers 26 factors including:
- Location of family and dependents
- Where you vote and are registered
- Driver's license state
- Where you work and conduct business
- Location of bank accounts
- Where professional services are obtained
- Organization memberships
183-Day Statutory Residency
You're a statutory resident if you spend more than 183 days in Minnesota and maintain a place of abode.
Snowbird Alert: Many Minnesota snowbirds split time between MN and FL. If you spend more than 183 days in Minnesota, even with Florida domicile, MN can tax your worldwide income.
Minnesota's Audit Program
Minnesota Revenue has a dedicated residency audit unit that examines:
- Credit card and bank transaction locations
- Cell phone records and usage patterns
- Social media activity showing location
- Medical and dental appointment locations
- Property ownership and utility usage
- Club and organization memberships
Properly Exiting Minnesota
- Establish Florida domicile (address, Declaration, DL, voter registration)
- Sell or rent Minnesota property
- Transfer memberships and professional ties to Florida
- Update all financial accounts to Florida address
- File MN part-year return (Form M1) for move year
- Keep detailed day-count records