Yes. You should only pay tax on the $14,980. However Minnesota prorates your actual tax liability based on the percentage of Minnesota income. This results in a higher tax, but many states do it this way.
First, Minnesota comes up with a base tax as if all your income (including IRA, pensions and annuities) were taxable to MN. Then it multiples the base tax times the ratio of MN/non-MN income.
For example, if you earned $10,000 total and $3,000 in MN, your tax rate would be based on $10,000. Say the MN tax on $10,000 is $2,000. Then your tax would be 30% ($3,000/$10,000) of $2,000 or $600.
You can see the calculation on Form M1 line 13.
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