Come here often? Make your homepage » close


Your XFINITY Connect session has timed out due to inactivity. Click here to go back close

Kiplinger: 10 Least Tax-Friendly States for Retirees

#5 Minnesota

State Income Tax: 5.35% to 7.85%

State Sales Tax: 6.875%

Estate Tax/Inheritance Tax: Yes/No

Minnesota offers retirees cold comfort on the tax front. Social Security income is taxed to the same extent it is taxed on your federal return. Pensions are taxable regardless of where your pension was earned. Income-tax rates are high. Sales taxes can reach 9.53% in some cities, but food, clothing, and prescription and nonprescription drugs are exempt from sales taxes. Minnesota's property taxes rank among the 20 highest, according to the annual 50-state property-tax comparison study conducted by the Minnesota Taxpayers Association. But residents of the North Star State get some relief starting in 2012. Minnesota homeowners may now exclude up to $30,400 of their home's market value from taxation. And if their 2012 property-tax bill jumps by more than 12%, they can claim a tax refund of up to $1,000. In addition, residents 65 and older who have incomes of $60,000 or less can defer a portion of their property tax. But this is a low-interest loan, not a tax-forgiveness program.


More From Kiplinger:
The 5 Best U.S. Cities for Retirees
QUIZ: Are You Saving Enough For Retirement?
10 Most Tax-Friendly States for Retirees

The opinions expressed are solely those of the author and do not necessarily reflect the views of Comcast.

Ad Info - Ad Feedback

Ad Info - Ad Feedback