By Chuck Roulet, Attorney · Licensed in Florida and Minnesota
Short answer: Many do. Minnesota’s estate tax starts at $3 million per person, and Minnesota doesn’t allow a surviving spouse to use the unused exemption of the spouse who died first. Without planning, a married couple can lose one exemption entirely.
The Federal Tax Isn’t the Problem
You may have heard that you don’t need a trust for estate taxes anymore. For the federal tax, that’s true for most families today. In 2026, the federal exemption is $15 million per person. Federal law also allows “portability,” which lets a surviving spouse use the unused exemption of the first spouse to die.
Keep in mind that Congress can change the federal exemption. A bill introduced in March 2026 would cut it to $3.5 million per person. I explain what that could mean in Is the Federal Estate Tax Exemption Really “Permanent”?
Minnesota Is Different
Minnesota has its own estate tax, with an exemption of $3 million. And Minnesota has no portability. If the first spouse leaves everything to the survivor, the first spouse’s $3 million exemption goes unused and is lost.
When the surviving spouse dies, their estate gets only one $3 million exemption. Minnesota’s estate tax rates run from 13 to 16 percent on the amount above that.
An Example
A Minnesota couple has $4 million. That’s the house, a lake cabin and retirement savings. It adds up faster than most people expect.
Dad dies and leaves everything to Mom. When Mom dies, her $4 million estate gets one $3 million exemption. The extra $1 million can mean roughly $130,000 in Minnesota estate tax.
With the right trust, set up while both spouses are alive, the first spouse’s share can be held in a separate trust that uses the first exemption. In many cases, that brings the Minnesota tax down to zero, and the surviving spouse still has full use of the money.
Who Should Look at This
If you’re a married Minnesota resident and your combined estate is anywhere near $3 million, counting your home, cabin, retirement accounts and life insurance, it’s worth a review. Minnesota real estate owned by people who live elsewhere, including Florida snowbirds, can also be subject to Minnesota estate tax.
Watch the Video
I explain this in my video “Is Getting a Trust a HUGE Mistake? What I’ve Learned After 30 Years”.
Read the full article: Is Getting a Trust a Huge Mistake? What I’ve Learned After 30 Years
If you’d like an attorney to look at your Minnesota estate tax exposure, schedule a consultation with our Minnetonka office at rouletlaw.com or call 763-420-5087 or fill out the contact form on this page.
About the Author
Chuck Roulet is the founding attorney of Roulet Law Firm, P.A., with offices in Minnetonka, Minnesota and Venice, Florida. He has practiced estate planning and elder law for nearly 30 years and is one of very few attorneys licensed in both Minnesota and Florida. Chuck has trained more than 35,000 attorneys and financial professionals as a continuing education speaker and is the author of three books, including The Florida Snowbird Guide. Florida: 941-909-4644 · Minnesota: 763-420-5087 · rouletlaw.com
This page is general information, not legal advice. Reading it does not create an attorney-client relationship.
