The short version
- Social Security taxed?
- Partly
- Income tax
- Brackets 5.35%–9.85%
- Property tax on a $300,000 home
- ≈ $3,000 / yr ($250 / mo)
- Everyday cost index (U.S. = 100)
- 95
- January / July high
- 24°F / 84°F
- Sales tax (state + local avg)
- 8.14%
Retiring in Minnesota
The best healthcare in America at Mayo Clinic and reasonable living costs. Watch out: among the highest taxes on retirement income, plus one of only eight states taxing Social Security.
How Minnesota taxes your retirement income
Social Security: this state taxes a portion of benefits, usually above certain income levels.
Pensions: Pensions taxed as regular income.
401(k) and IRA withdrawals: 401(k)/IRA withdrawals taxed as regular income.
The setup: Brackets 5.35%–9.85%.
Property tax & senior breaks
The average effective property tax rate is about 1.00% — roughly $3,000 a year ($250 a month) on a $300,000 home. Your county sets the real number.
Help for seniors: Senior citizen property tax deferral program; homestead market value exclusion.
Try your own home value in the Property Tax Estimator.
Everyday costs & sales tax
Overall cost of living runs about 5% below the U.S. average. The combined state and average local sales tax is 8.14%.
Weather
January days top out around 24°F and July days around 84°F, with roughly 196 sunny days a year. Watch out for: Extreme cold and blizzards; beautiful summers.
Healthcare
Mayo Clinic in Rochester and excellent care statewide.
Estate & inheritance taxes
Minnesota has an estate tax. Estate tax above a $3 million exemption