Key figures
Minnesota receivables
2026, with sources
Nexus on a rolling 12 months
Minnesota measures its small seller exception over the prior 12 months, not the calendar year: a remote seller must register and collect once it has more than $100,000 of retail sales or 200 or more retail sales shipped to Minnesota, starting on the first day of a month no later than 60 days after exceeding either. Sales for resale, backed by Form ST3, don’t count.
The state rate is 6.875%, and local, special local and special taxes are added by location.
Software is taxable however it arrives
Minnesota is one of the states least friendly to software sellers. Revenue’s fact sheet treats canned or prewritten software as taxable whether delivered on disc, by download, electronically or by load-and-leave, and whether billed periodically or per use; its digital products guidance says prewritten software is always tangible personal property, no matter how it is transferred. Custom software and access to data in a remote database are not taxable.
For a SaaS company, the practical question is whether the product is a license to prewritten software or access to data or a service. A company that concludes its Minnesota sales are taxable collects 6.875% plus local rates once it passes 200 sales — which a $30-a-month product reaches quickly.
Receipts and the franchise tax
Minnesota-sourced receipts also drive the franchise tax and the minimum fee. Minnesota apportions by sales alone and treats services received in Minnesota as creating nexus, so a company with Minnesota customers can owe the franchise tax without any people in the state.
The federal baseline
This page covers what Minnesota adds. The federal rules underneath it apply here too.
Common questions
Is our SaaS taxable in Minnesota?
It depends on what the customer is buying. Minnesota taxes prewritten software however it is delivered and however it is billed — monthly, yearly or per use — and taxes digital products broadly. Charges for access to data in a remote database are not taxable. A subscription that is, in substance, a license to use prewritten software is the case to treat as taxable; one that is access to data or a service may not be. Revenue’s Fact Sheet 134 is the starting point.
Does Minnesota still count transactions for nexus?
Yes — Minnesota still uses both tests. A remote seller must collect once it has more than $100,000 of retail sales or 200 or more retail sales shipped to Minnesota in the prior 12 months, and it must register by the first of a month no later than 60 days after crossing.
Receivables next door
- IAIowa receivablesIowa taxes SaaS but exempts it for commercial enterprises, so B2B sellers collect certificates rather than tax. Nexus is $100,000 of all Iowa revenue, exempt sales included.
- NDNorth Dakota receivablesA 5% state sales tax plus local, with $100,000 of taxable sales as the nexus line. Prewritten software is taxable however delivered; hosted access generally isn’t.
- SDSouth Dakota receivablesSouth Dakota taxes services and products transferred electronically, SaaS included, at 4.2% plus municipal rates through June 30, 2027. Remote sellers register at $100,000.
- WIWisconsin receivablesWisconsin charges 5% plus county and Milwaukee city rates, counts only $100,000 of sales toward nexus, and doesn’t tax SaaS hosted on the vendor’s servers.
Founder guides on this
- Sales taxSales tax nexus for startups: when you owe tax in a stateSince Wayfair, selling into a state can create a sales tax obligation. How economic nexus works, why SaaS is taxable in some states and when to register.
- RevenueDeferred revenue for SaaS startups, explainedAn annual prepayment is cash today and revenue over a year. How deferred revenue works under ASC 606, why it’s a liability, and the schedule behind it.
- StripeHow to reconcile Stripe payouts to your booksA Stripe payout is charges less fees, refunds and disputes, batched across days. How to book it gross, tie it to the bank, and keep revenue right.
More of the Minnesota guide
- AccountingAccounting and state tax in MinnesotaCorporate tax, conformity to federal rules, apportionment and what it does to your books
- PayablesPayables and contractors in MinnesotaPaying vendors and contractors: 1099 filing, use tax, contractor tests and withholding
- PayrollPayroll taxes and employer rules in MinnesotaWithholding, unemployment insurance, paid leave, minimum wage and the rules on paydays
- ComplianceCompliance and filings in MinnesotaRegistering to do business, annual reports, franchise tax and the filing calendar
- AdvisoryAdvisory: credits and decisions in MinnesotaCredits, incentives and the decisions that are cheaper to get right the first time
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.