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Premium Tax Credit (ACA) in Minnesota 2026

Calculate your premium tax credit (aca) tax savings in Minnesota. With Minnesota's 9.85% top state tax rate, your combined savings are higher.

Minnesota Tax Overview

State Income Tax
9.85%
progressive
Sales Tax
6.875%
avg combined: 7.49%
Property Tax Rate
1.05%
Median Income
$77,706

Four brackets to 9.85% (5th highest). Estate tax ($3M). Clothing exempt from sales tax.

Minnesota Income Tax Brackets (Single)

5.35%
$0 - $31,690
6.8%
$31,690 - $104,090
Your bracket
7.85%
$104,090 - $193,240
9.85%
$193,240 +
$5,000
Est. Total Savings
No Limit
Max Deduction
Tax Credit
Deduction Type
28.8%
Combined Tax Rate

Premium Tax Credit (ACA) Savings Calculator for Minnesota

$
$

Federal Savings

$5,000

22% bracket

Minnesota State

$0

6.8% rate

Total Savings

$5,000

28.8% combined

Tax credits reduce your tax bill dollar-for-dollar, regardless of your tax bracket.

Savings by Tax Bracket in Minnesota

10%
$5,000
12%
$5,000
22%
$5,000
24%
$5,000
32%
$5,000
35%
$5,000
37%
$5,000

Includes 6.8% Minnesota state tax on top of federal savings.

Eligibility Requirements

Individuals who purchased health insurance through the ACA Marketplace

  • 1Household income 100-400% of federal poverty level
  • 2Not eligible for employer coverage or Medicare
  • 3Purchased through Healthcare.gov or state exchange

Minnesota residents should verify that this deduction is also recognized on their state tax return for additional savings of up to 9.85%.

Common Mistakes to Avoid

  • !Not reconciling advance payments at tax time
  • !Forgetting to report life changes that affect eligibility
  • !Not filing Form 8962 and losing the credit
  • !Forgetting to claim the deduction on your Minnesota state return (missing up to 9.85% additional savings)

Minnesota Filing Tips

High rates make pre-tax contributions essential. Clothing is sales-tax-exempt. The $3M estate tax exemption is well below federal. K-12 education credit available.

Required Tax Forms

Form 8962Form 1095-A

File these forms with your federal tax return to claim the premium tax credit (aca). Minnesota may require additional state-specific forms.

Other Tax Deductions in Minnesota

Medical & Dental Expenses

Medical

~$3,927
est. savings

Self-Employed Health Insurance

Medical

~$6,545
est. savings

HSA Contribution Deduction

Medical

~$2,356
est. savings

Long-Term Care Insurance

Medical

~$2,618
est. savings

Medical Travel Expenses

Medical

~$1,047
est. savings

Flexible Spending Account (FSA)

Medical

~$1,178
est. savings

Medical Equipment & Devices

Medical

~$1,964
est. savings

Therapy & Counseling

Medical

~$2,618
est. savings

Premium Tax Credit (ACA) in Neighboring States

Wisconsin

7.65% top rate (progressive)

~$6,800
+1,800 vs Minnesota

Iowa

3.8% top rate (flat)

~$6,800
+1,800 vs Minnesota

South Dakota

No state income tax

~$6,800
+1,800 vs Minnesota

North Dakota

1.95% top rate (flat)

~$6,800
+1,800 vs Minnesota

Tax Calculators for Minnesota Cities

MinneapolisSt. PaulSaint PaulRochesterDuluthBloomingtonBrooklyn ParkPlymouthMaple GroveWoodbury

Calculate Your Full Tax Savings in Minnesota

Use our free tax calculators to optimize your entire tax return for Minnesota.

Income Tax CalculatorMinnesota Income TaxFull Premium Tax Credit (ACA) Guide

Frequently Asked Questions

How much can I save with the Premium Tax Credit (ACA) in Minnesota?

In Minnesota, the premium tax credit (aca) can save you an estimated $5,000 per year on a $5,000 deduction. This includes $5,000 in federal tax savings and $0 in Minnesota state tax savings at the 6.8% marginal rate. The national average savings is $6,800/year.

What is the Minnesota state income tax rate?

Minnesota has a progressive income tax system with a top rate of 9.85%. Four brackets to 9.85% (5th highest). Estate tax ($3M). Clothing exempt from sales tax.

Who qualifies for the Premium Tax Credit (ACA) in Minnesota?

Individuals who purchased health insurance through the ACA Marketplace. The eligibility requirements are the same whether you live in Minnesota or another state, as this is a federal tax credit. However, your total savings will vary based on Minnesota's 9.85% top state tax rate.

What tax forms do I need to claim the Premium Tax Credit (ACA) in Minnesota?

To claim the premium tax credit (aca), you need to file Form 8962 and Form 1095-A with your federal return. Minnesota residents should also check if the state allows this deduction on their state return for additional savings of up to 9.85%. Filing status affects your deduction limits and tax bracket.

Is the Premium Tax Credit (ACA) better in Minnesota than in states without income tax?

Yes, Minnesota residents benefit more because the state's 9.85% top income tax rate means the deduction reduces both your federal AND state tax liability. In states with no income tax (like Texas, Florida, or Nevada), this deduction only reduces federal taxes. Your combined rate of 28.8% means more savings per dollar deducted.

What is the standard deduction in Minnesota for 2026?

Minnesota's standard deduction is $14,575 for single filers and $29,150 for married filing jointly. High rates make pre-tax contributions essential. Clothing is sales-tax-exempt. The $3M estate tax exemption is well below federal. K-12 education credit available.

Related Calculators

Medical & Dental Expenses in Minnesota

Avg savings: $3,000/year

Self-Employed Health Insurance in Minnesota

Avg savings: $5,000/year

HSA Contribution Deduction in Minnesota

Avg savings: $1,800/year

Long-Term Care Insurance in Minnesota

Avg savings: $2,000/year

Medical Travel Expenses in Minnesota

Avg savings: $800/year

Flexible Spending Account (FSA) in Minnesota

Avg savings: $900/year