Flat-Fee Tax Preparation for Wisconsin Residents

Wisconsin has a graduated income tax with rates from 3.5% to 7.65% — the top rate applies to income over $304,200 (married filing jointly)

Wisconsin provides a 30% capital gains exclusion for long-term gains — effectively taxing long-term capital gains at about 70% of the ordinary income rate

The WI Pass-Through Entity Tax election allows eligible S-corps and partnerships to pay WI income tax at the entity level for SALT cap planning

Wisconsin does not tax Social Security benefits — favorable for WI retirees

WI real estate transfer tax is $0.30 per $100 of value — 0.30% — one of the lower transfer tax rates in the Midwest

Wisconsin does not impose a state estate tax or inheritance tax

WI does not conform to federal bonus depreciation — WI requires property to be depreciated under the regular MACRS schedule without bonus deductions, creating significant book/tax differences

Wisconsin's manufacturing property tax exemption (machines and equipment used in manufacturing are exempt from personal property tax) is relevant for manufacturing businesses in WI

Wisconsin Real Estate Tax

Wisconsin's real estate market features Milwaukee, Madison, and extensive lake country and resort property. WI's non-conformity with federal bonus depreciation creates differences between federal and WI returns for investors with cost segregation studies. The 30% capital gains exclusion provides meaningful reduction in the state-level capital gains burden for WI real estate investors.

Wisconsin Business Tax

Wisconsin businesses face the income tax rate up to 7.65% but benefit from the capital gains exclusion, no estate tax, and low transfer tax. The non-conformity with bonus depreciation requires careful tracking of WI-specific depreciation schedules. The WI PTET election provides SALT cap relief. Manufacturing businesses benefit from the personal property tax exemption on manufacturing equipment.

Do I need to file a Wisconsin state tax return?

If you are a Wisconsin resident or earned WI-source income above the filing threshold, you must file a WI Form 1. Wisconsin taxes residents on worldwide income at graduated rates up to 7.65%. Non-residents with WI-source income, including wages from WI employers or rental income from WI properties, must file a WI non-resident return.

What is Wisconsin's capital gains exclusion?

Wisconsin allows taxpayers to exclude 30% of net long-term capital gains from WI taxable income. This means if you have a $100,000 long-term capital gain from selling WI investment property, only $70,000 is subject to WI income tax. At the top 7.65% rate, this reduces the effective WI rate on long-term gains to approximately 5.36%. The exclusion applies to gains from most assets held over 12 months.

Does Wisconsin conform to federal bonus depreciation?

No. Wisconsin does not conform to federal bonus depreciation (Section 168(k)). Assets that are fully expensed on the federal return must be depreciated over their regular MACRS life on the WI return. This creates a significant timing difference between federal and WI taxable income for businesses and real estate investors who use bonus depreciation or cost segregation with bonus. WI-specific depreciation schedules must be maintained separately.

What is the Wisconsin PTET election?

Wisconsin's Pass-Through Entity Tax allows eligible S-corps and partnerships to elect to pay WI income tax at the entity level. The payment is deductible on the federal return as a business expense, providing SALT cap relief. Partners and shareholders receive a credit against their individual WI tax. For WI business owners subject to the SALT cap, the PTET election is typically beneficial and should be evaluated annually.