Quick Minnesota Tax Stats
| Tax Type | Rate / Info |
|---|---|
| Income Tax | 5.35% – 9.85% progressive state income tax |
| Sales Tax | 6.875% statewide base; ~ 7.5%–8.5% combined in many cities |
| Jock Tax | Minnesota taxes income earned from work performed in the state |
| Cost of Living (Range) | $95,000 – $210,000+ annual (Minneapolis–St. Paul metro lifestyle) |
| Average Home Price | ~$350,000 – $450,000 (3-bed/2-bath in Twin Cities metro) |
| Property Tax (Effective Rate) | ~1.1%–1.3% average effective rate |
Income Tax in Minnesota
Minnesota uses a progressive income tax system with rates ranging from 5.35% to 9.85% depending on income level.
For high earners such as professional athletes, income typically falls into the top bracket (9.85%), which is among the highest state income tax rates in the United States.
For professional athletes:
- Progressive bracket system increases effective tax burden.
- Applies to wages, bonuses, sponsorships, and pass-through income.
- No additional city income tax layer.
Minnesota sits in the upper tier of state income tax burdens, closer to California and New York than to midwestern low-tax states like Indiana.
Minnesota’s high top bracket makes it one of the more expensive tax domiciles for athletes.
Example
An NBA player earning $30 million while domiciled in Minnesota would owe ~$2.95 million in state income tax (9.85%). Compared to a 0% income-tax state like South Dakota, that’s a significant annual difference. Over a 4-year contract, the spread approaches ~$11.8 million retained elsewhere.
Sales Tax
Minnesota has a 6.875% statewide base sales tax, with additional local taxes bringing combined rates to ~7.5% – 8.5% in Minneapolis and St. Paul.
For high-income athletes:
- Luxury purchases are taxed near or above 8%.
- Vehicle purchases in the Twin Cities metro typically exceed 8% total tax.
- Consumption taxes meaningfully affect large purchases.
Minnesota’s sales tax burden is moderate to moderately high compared to other pro sports markets.
With an 8% sales tax, asset and liability purchases are both affected negatively as depreciation starts faster and appreciation takes longer to see a return on investment.
The higher the sales tax rate, the deeper in the hole you start financially, compared to if you bought the same asset in Oregon or Montana.
Example
A $250,000 vehicle purchase at an ~8% rate ≈ $20,000 in sales tax.
Jock Tax
Minnesota imposes jock taxes on any/all pass-through gross income earned from work performed within the state.
This affects the following professional teams:
Visiting athletes owe Minnesota tax on salary allocated to games played in-state. Minnesota-domiciled athletes owe full state income tax on worldwide income.
Example
A Timberwolves player domiciled in Minnesota owes up to 9.85% on salary and endorsement income while still paying jock tax to other states for away games. Progressive brackets make tax modeling slightly more complex compared to flat-tax states.
Cost of Living
Minnesota’s cost of living centers around the Twin Cities metro area.
Estimated annual lifestyle range:
- $95K–$140K comfortable metro living
- $170K–$210K+ high-end Minneapolis lifestyle
Outside the Minneapolis–St. Paul region, living costs decrease significantly. The Twin Cities drive most high-cost exposure in the state.
Housing
Average 3-bed / 2-bath home:
- ~$350K–$450K in the Twin Cities metro
- Suburban homes: $500K–$850K common
- Luxury lakefront estates exceed $2+ million
Compared to coastal sports markets, housing is moderately affordable, though rising demand has pushed prices higher in recent years.
Property Taxes
Minnesota has moderately high property taxes, averaging a ~1.1%–1.3% effective rate. While lower than states like Illinois or New Jersey, property taxes still represent a meaningful long-term expense for high-value homes.
On a $1.5 million home ≈ $16,500 – $19,500 annually in property taxes.
Residency Rules
Athletes establishing residency in Minnesota must:
- Obtain Minnesota driver’s license
- Register vehicles in-state
- Register to vote
- Establish primary residence
- Demonstrate intent to remain
Minnesota taxes residents on worldwide income up to 9.85%.
Example
A baseball player signing with the Twins and establishing Minnesota residency would owe up to 9.85% on salary and endorsement income, while still paying jock tax to other states for away games. Proper multi-state tax credit planning is critical for high earners.
Why Minnesota Is Challenging for Athletes
Pros
- Strong professional sports market
- Major endorsement opportunities in Minneapolis–St. Paul
- Housing cheaper than major coastal markets
- Stable midwestern economy
Cons
- High top income tax rate (9.85%)
- Progressive bracket structure increases tax burden
- Moderate-to-high sales taxes in major cities
- Property taxes add additional long-term costs
Minnesota sits closer to high-tax states than midwestern low-tax peers.
While housing costs remain manageable compared to coastal cities, the top income tax bracket materially reduces net contract earnings for professional athletes.
For high earners, Minnesota’s 9.85% top bracket is the primary financial modeling factor.
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Next Athlete State Tax Reads
- North Dakota State Athlete Taxes
- South Dakota State Athlete Taxes
- Michigan State Athlete Taxes
- Wisconsin State Athlete Taxes
- Nebraska State Athlete Taxes
Next Reads
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Credits
Sources: Minnesota Department of Revenue, Tax Foundation 2025 State Tax Data, Zillow / Redfin Housing Data, APSM Proprietary Analysis
Disclaimer: This article contains general financial information for educational purposes and does not constitute professional advice.
Apostle Sports Media 