Is there an inheritance tax in Minnesota?
No. Minnesota has no inheritance tax — you don't pay a tax for the act of receiving your parents' house.
The tax that does exist here is the estate tax, and it's paid by the estate, not by you. Minnesota's kicks in around three million dollars in total estate value; the federal threshold sits far higher. For most households, a house plus savings doesn't reach either line, and no estate tax is owed. The tax people actually encounter is capital gains when the house sells, and the stepped-up basis usually shrinks that to little or nothing. Three different taxes, constantly confused with each other — which is exactly how bad advice spreads at funerals. A CPA or estate attorney can confirm where your family lands; I'm neither, and this isn't tax advice.
Short version: receiving the house costs you nothing. What matters is documenting its value at death — and that part, I can help arrange this week.
I wrote this answer, and I stand behind it. I'm Chris Deutsch, a Minneapolis Realtor (MN #20382264). Twenty-five years of walking these neighborhoods, checking basements, and sitting across kitchen tables from people making exactly this call. I re-check every answer and date it — this one was last verified .
If your situation is more specific than the market, that's the one worth talking through. Email me at chris@lakesarearealty.com.