2026 tax year · Minnesota
RSU tax in Minnesota
A $60,000 vest costs $5,572 in Minnesota tax on top of the federal bill. And the federal share withheld is $2,970 short.
What a $60,000 vest actually costs in Minnesota
A single filer already earning $180,000 in salary. The vest stacks on top of that, so it fills the highest brackets rather than starting at the bottom:
| Withheld by your employer at 22.0% | $13,200 |
| Federal tax the vest actually costs | $16,170 |
| Federal shortfall, owed in April | $2,970 |
| Minnesota income tax on the vest | $5,572 |
| Total still to find | $8,542 |
The withholding rate is flat, 22.0% below $1 million of supplemental pay. And takes no account of your salary. That is why the gap grows the more you earn.
The gap widens with salary
| Salary | Withheld | Actually owed | Shortfall | Minnesota tax |
|---|---|---|---|---|
| $90,000 | $13,200 | $13,764 | $564 | $4,541 |
| $160,000 | $13,200 | $14,570 | $1,370 | $5,172 |
| $260,000 | $13,200 | $20,630 | $7,430 | $5,910 |
How Minnesota treats a vest
Minnesota taxes a vest as ordinary income like any other wages, adding $5,572 on top of the federal bill for $60,000 of vesting stock.
If you moved during the vesting period, the income is split between the states you worked in across it: Days worked in each state / total days in vesting period x RSU income = each state's allocation That is worked out day by day, not by where you lived on the vesting date.
Minnesota specifics that change the number
Minnesota is one of the twelve states that still taxes Social Security benefits, which matters if you are drawing benefits alongside a vest.
What the same vest costs around Minnesota
Total income of $240,000 in the states Minnesota borders:
| State | Its tax | vs Minnesota |
|---|---|---|
| South Dakota | No income tax | −$18,121 |
| North Dakota | $3,634 | −$14,487 |
| Iowa | $9,120 | −$9,001 |
| Wisconsin | $12,333 | −$5,788 |
- South Dakota has no income tax at all, so the same work done there costs $18,121 less in state tax than it does in Minnesota.
- North Dakota would take $14,487 less, $3,634 against Minnesota's $18,121.
- Iowa would take $9,001 less, $9,120 against Minnesota's $18,121.
- Wisconsin would take $5,788 less, $12,333 against Minnesota's $18,121.
RSU questions in Minnesota
Should I sell at vest?
Selling immediately raises the cash for the $8,542 you still owe and leaves no capital gain, because the sale price equals the price you were already taxed on. Holding turns it into an investment decision, any further gain is a capital gain, and any fall is a loss you take on shares you were already taxed on at the higher value.
I moved to Minnesota mid-vest, who taxes it?
Both states, split by workdays. The income is allocated across the vesting period, not assigned to wherever you happened to live on the vesting date. The state you left can still claim its share, and California, New York and Massachusetts pursue it hardest.