Minnesota taxes personal income at 5.35% to 9.85%. A sole proprietor owes no separate business tax, and an LLC's annual renewal is free. Partnerships and S corporations are not taxed on profit at the business level, but they pay a minimum fee based on their Minnesota property, payroll and sales, and must withhold tax for owners who live elsewhere or include them in a composite return. C corporations pay 9.8% of their Minnesota income, plus the minimum fee.
Personal income tax
Minnesota residents file Form M1, due April 15, 2026. There is no late filing penalty if you file by October 15, 2026, but the tax itself is still due April 15, 2026.
For single filers the rate on taxable income is 5.35% on the first $32,570, 6.8% on the next $74,420, 7.85% on the next $91,640, 9.85% above $198,630. Married couples filing jointly pay 5.35% on the first $47,620, 6.8% on the next $141,560, 7.85% on the next $141,230, 9.85% above $330,410. Head of household and married filing separately filers have their own steps.
Minnesota has no personal exemption, only a $5,200 exemption for each dependent, which phases out at high incomes. The standard deduction shrinks once income passes $238,950, or $119,475 married filing separately. Social Security is taxed, but most retirees subtract most or all of it. Minnesota also has its own alternative minimum tax at 6.75%, owed only when it comes out higher than the regular tax.
- Return
- Form M1
- Due date
- April 15, 2026. No late filing penalty through October 15, 2026, but the tax is due April 15, 2026
- Rates
- 5.35%, 6.8%, 7.85%, 9.85%
- Standard deduction
- $14,950 single or married filing separately, $29,900 married filing jointly, $22,500 head of household
- Age 65 or blind
- $2,000 more each for single and head of household filers, $1,550 for married filers
- Deduction reduced
- By 3% of income above $238,950 and 10% above $330,300, but never by more than 80%
- Dependent exemption
- $5,200 each, phased out at high incomes
- Alternative minimum tax
- 6.75% on Schedule M1MT, owed only if higher than the regular tax
- Credits worth checking
- The refundable Child Tax Credit, the Working Family Credit, and the Property Tax Refund on Form M1PR for renters and owners
Sole proprietor
A sole proprietor with no LLC files nothing with Minnesota for the business. The annual renewal is only for registered entities.
Your business profit is taxed on your own Form M1, at the personal rates above.
Single-member LLC
Every Minnesota LLC files an annual renewal with the Secretary of State in each calendar year after the year it was formed. There is no fee while the LLC is active and in good standing, and it can be filed any time up to December 31.
Missing it is costly: the LLC is administratively dissolved, and bringing it back costs $65 by post or $85 expedited. The LLC's profit is taxed on your own Form M1.
Partnership
A Minnesota partnership files Form M3. The profit passes through to the partners, who report it on their own returns.
The partnership also pays a minimum fee, worked out on Schedule M3A from its Minnesota property, payroll and sales rather than its profit, so it is owed even in a loss year.
If a partner lives outside Minnesota, the partnership must withhold 9.85% of that partner's Minnesota income, less credits passed through to them, unless the partner is included in a composite return. Quarterly estimated payments start once the fee, withholding and any composite or pass-through entity tax reach $500.
S corporation
A Minnesota S corporation files Form M8. The profit passes through to the shareholders, who report it on their own returns.
It also pays a minimum fee, worked out inside Form M8 from its Minnesota property, payroll and sales, so it is owed even in a loss year. If a shareholder lives outside Minnesota, the corporation must withhold 9.85% of that shareholder's Minnesota income, less credits passed through, unless they are included in a composite return.
C corporation
A C corporation files Form M4, the corporation franchise tax return, and pays a flat 9.8% of the income apportioned to Minnesota. A corporation selling into other states counts only its Minnesota share, measured by Minnesota sales over total sales.
It also owes the minimum fee, which is based on Minnesota property, payroll and sales rather than profit.
- Return
- Form M4, corporation franchise tax return
- Corporate franchise tax
- 9.8% of Minnesota income
- Multi-state profit
- Minnesota sales over total sales
- Minimum fee
- Based on Minnesota property, payroll and sales, owed even in a loss year
Estimate your state tax
Pick your business type and enter this year's numbers to see the state business tax Minnesota charges. It assumes all your sales are in Minnesota.
An estimate for planning, not tax advice.
Sources
- Minnesota Individual Income Tax Instructions, 2025
- Minnesota Form M1, 2025
- Minnesota Schedule M1MT, 2025
- revenue.state.mn.us Minimum Fee
- revenue.state.mn.us 2025 Partnership Form M3 Instructions
- revenue.state.mn.us Nonresident Withholding
- revenue.state.mn.us Composite Income Tax
- revenue.state.mn.us Corporation Franchise Tax
- revenue.state.mn.us 2025 Minnesota Corporation Franchise Tax Instructions (Form M4)
- revenue.state.mn.us Revenue Notice #17-01, apportionment of income
Last reviewed August 2026.
File your 2025 return for free
The free tax filing tool builds your federal and Minnesota returns from plain-English questions.
Start the free tax filing tool