Minnesota residents face one of the higher state income tax burdens on CD interest in the US — roughly 5.35% to 9.85%, depending on bracket. This makes Treasury bills (exempt from Minnesota state income tax) an especially important comparison for MN savers. The best CD rates available to Minnesota residents reach approximately 4.44% APY through FDIC-insured online banks.
Rates shown are as of September 2026 and change frequently. Verify current rates directly with the institution before opening.
Best CD Rates Available to Minnesota Residents (September 2026)
| Institution | Type | 12-Month APY | Min. Deposit |
|---|---|---|---|
| Online banks (top-rate) | Online | 4.30–4.44% | $0–$10,000 |
| Wings Financial Credit Union | MN credit union | 3.75–4.25% | $500 |
| Affinity Plus FCU | MN credit union | 3.75–4.25% | $500 |
| US Bank (Special CD, when available) | National bank (MN HQ) | Varies — check current offer | $1,000 |
| US Bank (Standard) | National bank | 0.05–1.00% | $500 |
| Traditional big banks | National bank | 0.01–0.75% | $1,000+ |
Minnesota State Income Tax on CD Interest
Minnesota uses a progressive income tax structure with four brackets ranging from roughly 5.35% to 9.85%. Confirm the current-year bracket thresholds at revenue.state.mn.us, since exact dollar cutoffs adjust periodically.
Illustrative after-tax yield on a 4.35% CD for a MN resident in the ~7.85% bracket (22% federal):
- Total marginal rate: ~29.85%
- After-tax yield: ~3.05%
Treasuries Are Significantly More Valuable for Minnesota Residents
| 12-Month CD (top rate) | 1-Year Treasury | |
|---|---|---|
| Gross yield | ~4.35% | ~4.37% (per Fed H.15, Sept 14, 2026) |
| Federal taxable | Yes | Yes |
| MN state taxable (~7.85%, illustrative) | Yes | No |
| After-tax yield (22% federal + 7.85% MN) | ~3.05% | ~3.41% (federal-only) |
At Minnesota’s typical middle-income tax rates, Treasuries currently produce meaningfully more after-tax income than CDs on equivalent deposits. Minnesota residents should strongly consider Treasuries as a primary alternative before committing to a CD.
What $10,000 Earns at Top Available MN Rates
| Term | APY (top rate) | Gross Interest | After-Tax (22% federal + 7.85% MN, illustrative) |
|---|---|---|---|
| 6 months | 4.25% | ~$210 | ~$148 |
| 12 months | 4.35% | ~$435 | ~$305 |
| 2 years | 4.35% | ~$889 | ~$624 |
Figures use the APY compounding convention: A = P(1+APY)^years.
Notable Minnesota Institutions
- Wings Financial Credit Union — Apple Valley-based; open to aviation industry employees and residents of certain MN counties
- Affinity Plus FCU — St. Paul-based; open to Minnesota residents via various employer and association affiliations
- University of Minnesota Credit Union (UMCU) — Open to UM students, faculty, staff, and some community members
- US Bank — Minneapolis-based; standard rates are low, but Special CDs can be competitive when offered
Related Articles
- Best CD Rates of 2026
- 1-Year CD Rates 2026
- CDs vs. Treasury Bills 2026
- Wisconsin CD Rates 2026
- US Bank CD Rates 2026
The content on Wealthvieu is for informational purposes only and should not be considered financial, tax, or investment advice. Consult a qualified professional before making financial decisions. Full disclaimer · Editorial policy