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Free Minnesota Payroll Tax Calculator and MN Tax Rates

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    Pay Details

  • 2

    Exemptions

  • 3

    Federal Information

  • 4

    State Information

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    Locale Information

  • 6

    Voluntary Deductions

  • 7

    Calculate Paycheck

Welcome to our payroll calculator!

Before we jump in, who are you using this calculator for?

Thanks!

Our calculators are designed for employers, and they’ll ask for information you may not have. For a better experience, please check out this employee-focused paycheck calculator.

How much did your employee earn?

Gross Pay: This is the total amount of wages your employee earned before taxes and deductions are withheld.


For salaried employees, gross pay equals their annual salary divided by the number of pay periods per year. For hourly employees, gross pay equals the number of hours worked multiplied by their hourly wage.


(Don’t forget to add on any tips, commissions, or bonuses!)

Gross Pay Method: Is the gross pay amount based on your employee’s annual compensation, or by how many hours they worked in the last pay period?

Gross Pay YTD: Enter the total gross pay your employee has earned this year, prior to this paycheck. Normally, this can be found on the last pay stub.

Pay Frequency: How often do you normally issue paychecks?

Check Date: Enter the check date that should appear on your paycheck.

Is your employee exempt from any taxes?

Federal: In some cases, public and governmental employees are exempt from federal taxes. Check “yes” if your employee is exempt and Federal taxes should not be deducted.

FICA: In some cases, public and governmental employees are exempt from FICA. Check “yes” if your employee is exempt and FICA taxes should not be deducted.

Medicare: In some cases, public and governmental employees are exempt from Medicare taxes. Check “yes” if your employee is exempt and Medicare taxes should not be deducted.

Please enter your employee’s withholding information.

2020 W4: Would you like to use the 2020 withholding tables? Here’s an article that covers the 2020 W-4 updates if you aren’t sure.

Federal Filing Status: Select your employee’s filing status for federal withholding. This helps determine how much federal tax will be withheld.

Two Jobs: If the employee indicated that they have more than one job or are married and filing jointly with a working spouse, select Yes here.

Dependents Amount: Enter the amount your employee listed on Line 3 of their W-4, if any. This is where they claim dependents.

Other Income: If your employee listed another other income on line 4(a) of their W-4, enter the amount here.

Deductions: Enter any deductions that your employee listed on line 4(b) of their W-4, if applicable.

Additional Federal Withholding: If your employee has asked to have additional funds withheld from each paycheck, enter the amount here. If they have not, enter “0”.

Round Federal Withholding: Would you like us to round your employee’s withholding totals to the nearest dollar? (It’s not required, but it is permitted)

Now, add information for their state.

State: Select the state where withholding should be calculated. It should be the same state where the work was performed.

Now, add locale information if applicable.

Does your employee have any voluntary deductions?

Please add any additional deductions for items like health insurance, 401(k), HSAs/FSAs, or any other benefits.


Select type of deduction needed:

401(k)

Add deduction

HSA

Add deduction

Custom

Add deduction

Let’s finish crunching the numbers!

Click the button below to see your paycheck calculated.

Here’s your paycheck information:

Leave payroll to us.

We do all the hard work to set you up for just $40 + $6 per employee.

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Updated: January 1, 2024

There are a lot of big things in the state of Minnesota, including the Mall of America and a 52-block skyway system. That being said, running a successful small business is probably the biggest one for you, so let’s help with a task you want to get right — calculating payroll taxes.

 

Simply grab each employee’s W-4 and wage information and enter them into our handy payroll withholding calculator at the top of this page. We’ll do the math so you can write paychecks and take care of taxes. And below, we’ve compiled information that employers can use to stay ahead of their obligations.

Federal Payroll Taxes for Minnesota employers

First things first, we have to give Uncle Sam his due. Federal taxes are the biggest part of payroll taxes. We’ll quickly go over what you need to know when it comes to federal income taxes. If you would like to see a detailed rundown, we invite you to check out our step-by-step guide for more information.

  • Calculate Gross Wages:
    • For all your hourly employees, multiply their hours worked by the pay rate. Don’t forget to increase the rate for any overtime hours.
    • For all your salaried employees, divide each employee’s annual salary by the number of pay periods you have.
    • For all employees, don’t forget to add in bonuses, tips, and commissions. They all count toward gross wages.
  • Calculate Any Pre-Tax Withholdings: If your employees contribute to FSA, HSA, 401(k), or have any other pre-tax benefits, deduct the appropriate amount from their gross pay before you calculate payroll taxes.
  • Deduct Federal Income Taxes: Here comes the big enchilada. Federal tax rates can range anywhere from 0% to 37% of taxable earnings. We won’t get into the nitty-gritty here, but you can find further withholding information through the IRS website.
  • Deduct and match any FICA taxes:
    • Social Security tax, which is 6.2% of each employee’s taxable wages up until they reach $168,600 for the 2024 tax year, which means the maximum Social Security tax that each employee has to pay is $10,453.20 for the year. Employers also have to match the 6.2% tax, dollar-for-dollar.
    • Medicare tax, which is 1.45% of each employee’s taxable wages up to $200,000 for the year. For any wages above $200,000, there is what’s called the Additional Medicare Tax of 0.9%, which brings the total rate to 2.35%. Employers have to pay a matching 1.45% of Medicare tax, but only the employee is responsible for paying the 0.9% Additional Medicare Tax.
  • Calculate the FUTA Unemployment Tax, which is 6% of the first $7,000 of each employee’s taxable income. Only employers are responsible for paying the FUTA tax, not employees. But here’s a big caveat: if you pay state unemployment taxes in full and on time, you are eligible for a tax credit of up to 5.4%, which brings your effective FUTA tax rate to 0.6%. If this whopping 90% savings in FUTA tax doesn’t get you to pay on time, nothing will.
  • Subtract Post-Tax Deductions, which can be anything from court-ordered wage garnishments to child support. Most of your employees won’t have post-tax deductions, but you still have to look out for them.

New hires should complete a 2023 W4-MN

On top of the federal Form W-4 employee’s withholding certificate, your new employees should also complete the 2023 W4-MN Minnesota Withholding Allowance/Exemption Certificate which helps employers withhold the correct Minnesota income tax their employee’s pay.

Minnesota (MN) state payroll tax rates

Now that we’re done with federal income taxes, let’s tackle Minnesota state taxes. The State of Minnesota has a progressive income tax, meaning the more money your employees make, the higher the income tax. The income tax rate ranges from 5.35% to 9.85%.

 

The state tax is pretty high compared to other states, but at least Minnesota doesn’t impose any local taxes.

Almost all states require employers to carry workers’ compensation, including Minnesota. Learn how policies work, how this type of coverage protects employees from workplace injuries and illnesses, and what employers should know in our guide to Minnesota workers’ compensation insurance.

Reporting new hires in Minnesota

One of the items to add to your to-do list is reporting all newly hired, re-hired and any returning to work employees to the Minnesota Department of Human Services. You’ll want to do this within 20 days of the date they are hired, rehired, or return to work.

According to Minnesota’s new hire checklist, employers who submit reports electronically must do so in two monthly transmissions and not more than 16 days apart.

To take care of this task, you can share information a few ways.

 

Or many companies that offer payroll software can handle new hire reporting for employers in most states, including Minnesota.

 

Payroll call-to-action

Minnesota state unemployment insurance (SUI) rates

Employers are required to pay state unemployment insurance. Unfortunately, Minnesota’s is quite complex. The tax rate changes on a yearly basis and is dependent on many things, including wages and industry, but is generally between 0.1 to 9%. Unemployment taxes are especially complicated in the construction business, and can range as high as 8.9%.

 

Minnesota’s new employer tax rates range from 1.1% to 9%, including the 0.1% base tax rate and also vary by industry. Minnesota’s Unemployment Insurance Program provides a 2024 table that includes an industry overview.

 

The one constant for all employers is that the wage base is $42,000 for each employee, in 2024. For reference, in 2023 it was $40,000.

 

Click here to see more details about Minnesota SUI and all the rates.

Did you know that Minnesota is one of the states with tax reciprocity? Their agreement is in place with Michigan and North Dakota. This means that if an employee lives in either Michigan or North Dakota and wants taxes withheld for their home state instead of where your business is located, they’ll have to complete Form MWR and give it to you.

 

Cut those checks!

Now that you’ve mastered both federal and state taxes, you’re on your way to becoming a big thing in Minnesota! Once you’ve withheld taxes and calculated each employee’s net pay, you’ll be ready to spread the wealth.

 

Don’t forget to set aside the employer taxes your business is responsible for paying, or else you will have a big tax surprise when year-end rolls around.

 

Federal tax filings are due quarterly by filing Form 941 and annually by filing Form 940. You can pay taxes on an ongoing basis via the EFTPS payment system. Employment tax due dates can be found here.

Additional payroll tax resources for Minnesota employers

If you want to learn more about Minnesota payroll taxes, we suggest you start with these websites:

 

Minnesota Department of Revenue: (651) 282-9999 | Withholding Taxes | Make a Payment

 

Minnesota Unemployment Insurance: (651) 296-6141 | Unemployment Insurance Program | Register As An Employer

More helpful payroll calculators

Minnesota employers are welcome to use the calculator at the top of this page to quickly calculate their employees’ gross pay, net pay, and deductions (and feel confident when cutting paychecks). But every once in a while, businesses have situations that require a bit more number crunching. For example, do you reward your top-performing employees with bonuses? Keep in mind that Uncle Sam considers this type of payment to be supplemental wages and requires taxes to be withheld. Also, if you have workers who come and go, there may be times when you need to figure out what their final paycheck will be. So, if you can use a little more help managing the math, check out some of the calculators listed below.

LET’S DO THIS

It’s easy to get started

Try OnPay out yourself to see how easy payroll and HR can be. To get started, just share a few basic details about your business. Our team of pros will set everything up and import your employees’ information for you.

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