When someone passes away, one understandably common practical concern among families is whether the deceased person’s unpaid taxes then become the responsibility of surviving loved ones. In Minnesota, as in other states, the general rule is that personal debts—including taxes—are paid from the deceased’s estate, not from the personal assets of surviving relatives.
After death, a person’s estate goes through a process called probate (unless other arrangements like a trust are in place). During probate, the estate’s representative is tasked with settling debts, including any federal, state or local taxes owed. This can include final income taxes, property taxes, and—in some cases—estate taxes. These debts are paid using money and assets from the estate before any inheritances are distributed.
Minnesota’s process
Minnesota does not have an inheritance tax, but it does impose a state estate tax for estates that exceed a certain value. As of 2025, that threshold is $3 million. Estates above this amount may owe taxes to the state before distributions can be made. The federal government also imposes an estate tax, but only on very large estates—those valued over $13.61 million for individuals in 2024.
If an estate does not have enough assets to cover outstanding taxes, then heirs and/or beneficiaries generally do not have to pay the difference out of pocket. However, if a family member has co-signed on a debt or jointly owned property that has tax obligations (like a home with unpaid property taxes), they might be held responsible accordingly.
A well-prepared estate plan can reduce tax burdens on surviving loved ones. Planning ahead with tools like wills, trusts and beneficiary designations can help ensure debts are handled efficiently and that a testator’s family receives what they intend for them.The post Will your loved ones have to pay your taxes after you die? first appeared on Scott + Hespen Law, PLLC.
↧