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 that differ by bank and term at FDIC-insured online banks.
Bank rates below were read from each bank’s own page, with the date shown under the table. Verify current rates directly with the institution before opening.
Best CD Rates Available to Minnesota Residents (Online Banks, October 2026)
| Institution | Type | 12-Month APY | Min. Deposit |
|---|---|---|---|
| Popular Direct | Online | 4.50% | $10,000 |
| Marcus by Goldman Sachs | Online | 4.40% | $500 |
| EverBank | Online | 3.50% | $1,000 |
Rates read from each bank’s own page: Popular Direct October 5, 2026, Marcus October 15, 2026, EverBank October 9, 2026. These online banks accept customers in any state. We did not check rates at local credit unions and community banks, so they are not listed with rates here; ask them directly.
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 hypothetical 4.50% CD for a MN resident in the ~7.85% bracket (22% federal):
- Total marginal rate: ~29.85%
- After-tax yield: ~3.16%
Treasuries Are Significantly More Valuable for Minnesota Residents
| 12-Month CD (hypothetical) | 1-Year Treasury | |
|---|---|---|
| Gross yield (hypothetical, same for both) | 4.50% | 4.50% |
| Federal taxable | Yes | Yes |
| MN state taxable (~7.85%, illustrative) | Yes | No |
| After-tax yield (22% federal + 7.85% MN) | ~3.16% | ~3.51% (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 (Popular Direct) | Gross Interest | After-Tax (22% federal + 7.85% MN, illustrative) |
|---|---|---|---|
| 6 months | 4.35% | ~$215 | ~$151 |
| 12 months | 4.50% | ~$450 | ~$316 |
| 2 years | 4.70% | ~$962 | ~$675 |
Figures use Popular Direct’s APYs as of October 5, 2026 (it requires $10,000 to open a CD) and the 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
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- CDs vs. Treasury Bills 2026
- Wisconsin CD Rates 2026
- US Bank CD Rates 2026
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