Tax Comparison: ND, SD, IA, MN, and WI Resident Income, Sales, Property, and Estate Tax Impact
Thomas C. Lamey, CPA
| State | Individual income tax | State sales tax | Property tax / resident relief impact | Overall resident tax profile |
|---|---|---|---|---|
| North Dakota | Low progressive structure: 0%, 1.95%, and 2.5% under N.D. Cent. Code § 57-38-30.3; 2026 single-filer thresholds include $49,575 and $250,400. | 5% general state rate under N.D. Cent. Code § 57-39.2-02.1, plus local sales taxes in many cities/counties. | Homestead relief is mainly targeted to age 65+ or permanently and totally disabled homeowners with limited income under N.D. Cent. Code § 57-02-08.1. | Low income-tax burden; total burden depends heavily on local sales/property taxes. |
| South Dakota | No individual income tax; South Dakota’s income-based tax applies to banks and financial institutions under S.D. Codified Laws § 10-43-1 et seq. | 4.2% through June 30, 2027, under S.D. Codified Laws §§ 10-45-2 and 10-46-2, then scheduled to return to 4.5% after June 30, 2027. | Owner-occupied homes receive a reduced school general-fund levy, and qualifying seniors/disabled residents may receive an assessment freeze under S.D. Codified Laws §§ 10-13-39, 10-12-42, and 10-6A-1–10-6A-2. | Usually the lowest income-tax option, but sales/property taxes carry more of the load. |
| Iowa | Flat 3.8% individual income tax under Iowa Code §§ 422.5 and 422.5A, plus possible local school-district or county surtaxes under Iowa Code provisions including §§ 257.19, 257.21, 298.2, and 422D.2. | 6% state sales/use tax under Iowa Code §§ 423.2 and 423.5. | Basic homestead credit is the lesser of tax on the first $4,850 of value or $62.50, and homeowners age 65+ receive a $6,500 taxable-value exemption for assessment years beginning on or after Jan. 1, 2024, under Iowa Code §§ 425.1, 425.1A, and 425.2. | Middle of the pack: moderate flat income tax, 6% sales tax, and meaningful homestead provisions. |
| Minnesota | Highest income-tax profile: 5.35%, 6.8%, 7.85%, and 9.85% under Minn. Stat. § 290.06; 2026 single-filer brackets begin at $0–$33,310, $33,311–$109,430, $109,431–$203,150, and $203,151+. | 6.875% state sales/use tax under Minn. Stat. §§ 297A.62 and 297A.63, with local taxes possible. Sales taxes in the Twin Cities can exceed 10%. | Offers broad homestead market-value credit under Minn. Stat. § 273.1384, renter credit under Minn. Stat. § 290.0693, and senior property-tax deferral generally limiting annual payment to 3% of household income if eligible. | Highest tax state in this group for many higher-income residents, partly offset by more substantial resident credits/refunds. |
| Wisconsin | Progressive rates of 3.5%, 4.4%, 5.3%, and 7.65%; 2026 single-filer brackets are $0–$15,110, $15,110–$51,950, $51,950–$332,720, and over $332,720. | 5% state sales/use tax under Wis. Stat. §§ 77.52 and 77.53, with common county and special local additions. | No general homestead exemption, but school levy and lottery/gaming credits may apply under Wis. Stat. § 79.10, and a refundable homestead credit is available to qualifying lower-income full-year residents. | Generally below Minnesota but above ND/SD for income tax; property-tax impact depends materially on locality and credits. |
| State | Estate / inheritance tax impact |
|---|---|
| North Dakota | No operative estate tax for 2026 deaths; N.D. Cent. Code § 57-37.1-02 authorizes an estate tax framework, but North Dakota’s former pick-up estate tax has been eliminated for deaths in 2013 and after unless reenacted. North Dakota also has no separate inheritance tax, and inheritances generally follow IRC § 102 exclusion treatment through N.D. Cent. Code § 57-38-01(13) |
| South Dakota | No estate tax for 2026 deaths, and S.D. Const. art. XV, § 15 prohibits an inheritance tax/ |
| Iowa | No Iowa inheritance tax applies to deaths on or after January 1, 2025, under Iowa Code §§ 450.10(7), 450.98, and 450B.8, so a 2026 death is not subject to Iowa inheritance tax. |
| Minnesota | Minnesota imposes an estate tax on resident estates and on Minnesota-situs property of nonresidents under Minn. Stat. §§ 291.03 and 291.016 The exclusion is $3 million for deaths in 2020 and after under Minn. Stat. § 291.016, subd. 3(b), and rates range from 13% to 16% under Minn. Stat. § 291.03, subd. 1(b)
Minnesota does not impose an inheritance tax.
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| Wisconsin | No Wisconsin estate tax applies for deaths after December 31, 2012, unless federal law is changed to restore a federal credit for state death taxes, under Wis. Stat. § 72.36
Wisconsin also does not levy a separate inheritance tax.
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