AB 461 Wisconsin Assembly · 2025-2026 Regular Session

Relating to: an income tax subtraction for certain overtime compensation. (FE)

AB 461 creates a new tax deduction for Wisconsin taxpayers who earn qualifying overtime pay. It allows individuals to subtract up to $12,500 (or $25,000 for joint filers) of overtime compensation from their taxable income, provided the overtime was reported to the IRS via standard forms (like Form 1099-NEC). The deduction phases out for higher earners: it decreases by $100 for every $1,000 their modified federal adjusted gross income exceeds $150,000 (or $300,000 for joint filers). This applies only to overtime pay reported to the IRS, excluding tips, and requires taxpayers to include their Social Security number on their return.

Bill status vetoed 4 of 5 stages cleared

Introduction

Sep 2025

Committee Review

Feb 2026

Assembly Passage

Jan 2026

Senate Passage

Mar 2026

Vetoed

Apr 2026

Introduced Sep 26, 2025 Vetoed Apr 3, 2026

Maddy AI version diff · 1 comparison

What changed between versions

Bill Text → Text as Enrolled · 5 edits

MODERATE

The bill text was converted from a legislative draft to the final enrolled version, updating the header to reflect Wisconsin Legislature and removing the original bill introduction details. The core policy changes include simplifying the overtime subtraction rule to rely directly on federal tax deductions rather than a separate calculation, extending the ability to claim the subtraction despite federal restrictions until 2028, and adding 'nontaxable deferred compensation' to the list of income sources.

Scope change

The scope of the overtime subtraction was broadened by removing specific dollar limits and phase-out thresholds, instead tying the deduction directly to the federal amount claimed. Additionally, the applicability timeline was extended for certain claimants through 2028.

ELIGIBILITY

The overtime subtraction limit was changed from a fixed dollar cap (e.g., $12,500) to the exact amount the taxpayer deducts on their federal return, removing previous income phase-out thresholds.

TIMELINE

A new provision allows taxpayers to claim the subtraction even if federal law prohibits it, but only for taxable years beginning after December 31, 2028.

DEFINITION

The definition of taxable income was expanded to include 'nontaxable deferred compensation' as an amount added to income.

REQUIREMENT

The specific requirement that the overtime compensation must appear on statements furnished pursuant to federal tax law was removed.

TECHNICAL

The text was updated from a draft bill format to the final enrolled format, including changes to the header and removal of the original sponsor list.

Floor votes · Senate Mar 17, 2026 · Assembly Jan 15, 2026

How they voted

21–12

Passed

Total votes 33

Mar 17, 2026

D Democratic15

3 Yea 12 Nay

80% Nay

R Republican18

18 Yea

100% Yea

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Apr 3, 2026

Vetoed

Report vetoed by the Governor on 4-3-2026

lower

Mar 17, 2026

Upper · Passed

Read a third time and concurred in, Ayes 21, Noes 12

upper

Mar 17, 2026

Introduced

Point of order that Senate Substitute Amendment 3 was not germane well taken

upper

Mar 17, 2026

Introduced

Point of order that Senate Substitute Amendment 2 was not germane well taken

upper

Mar 17, 2026

Introduced

Point of order that Senate Substitute Amendment 1 was not germane well taken

upper

Mar 17, 2026

Introduced

Senate Substitute Amendment 3 offered by Senators Habush Sinykin, Carpenter, Dassler-Alfheim, Drake, Hesselbein, L. Johnson, Keyeski, Larson, Pfaff, Ratcliff, Roys, Smith, Spreitzer, Wall and Wirch

upper

Mar 17, 2026

Introduced

Senate Substitute Amendment 2 offered by Senators Roys, Carpenter, Dassler-Alfheim, Drake, Habush Sinykin, Hesselbein, L. Johnson, Keyeski, Larson, Pfaff, Ratcliff, Smith, Spreitzer, Wall and Wirch

upper

Mar 17, 2026

Introduced

Senate Substitute Amendment 1 offered by Senators Spreitzer, Carpenter, Dassler-Alfheim, Drake, Habush Sinykin, Hesselbein, L. Johnson, Keyeski, Larson, Pfaff, Ratcliff, Roys, Smith, Wall and Wirch

upper

Feb 16, 2026

Upper · Passed

Report concurrence recommended by Joint Committee on Finance, Ayes 11, Noes 3

upper

Feb 13, 2026

Upper · Passed

Report of Joint Survey Committee on Tax Exemptions requested

upper

Feb 13, 2026

Committee

Withdrawn from committee on Senate Organization and rereferred to joint committee on Finance pursuant to Senate Rule 46(2)(c)

upper

Feb 13, 2026

Upper · Passed

Report concurrence recommended by Committee on Agriculture and Revenue, Ayes 5, Noes 3

upper

Jan 15, 2026

Lower · Passed

Read a third time and passed, Ayes 61, Noes 35, Paired 2

lower

Jan 15, 2026

Lower · Passed

Assembly Substitute Amendment 3 adopted

lower

Jan 15, 2026

Introduced

Assembly Substitute Amendment 3 offered by Representative Melotik

lower

Jan 15, 2026

Introduced

Point of order that Assembly Substitute Amendment 4 not germane under Assembly Rule 54 (3)(f) well taken

lower

Jan 15, 2026

Introduced

Assembly Substitute Amendment 4 offered by Representative Bare

lower

Jan 15, 2026

Introduced

Point of order that Assembly Substitute Amendment 5 not germane under Assembly Rule 54 (3)(f) well taken

lower

Jan 15, 2026

Introduced

Assembly Substitute Amendment 5 offered by Representative Bare

lower

Jan 15, 2026

Introduced

Assembly Substitute Amendment 2 offered by Representative Bare

lower

Jan 15, 2026

Introduced

Assembly Substitute Amendment 1 offered by Representative Bare

lower

Jan 13, 2026

Lower · Passed

Placed on calendar 1-15-2026 by Committee on Rules

lower

Jan 13, 2026

Committee

Referred to committee on Rules

lower

Jan 13, 2026

Lower · Passed

Report passage as amended recommended by Committee on Ways and Means, Ayes 7, Noes 3

lower

Jan 13, 2026

Lower · Passed

Report Assembly Amendment 1 adoption recommended by Committee on Ways and Means, Ayes 10, Noes 0

lower

Jan 7, 2026

Introduced

Assembly Amendment 1 offered by Representative Melotik

lower

Sep 26, 2025

Introduced

Introduced by Representatives Melotik, Donovan, Franklin, Callahan, Dittrich, Goeben, Green, B. Jacobson, Kaufert, Knodl, Kreibich, Mursau, Penterman, Petersen, Sortwell, Steffen, Tusler and Wichgers; cosponsored by Senators Hutton, Wanggaard, Bradley, Cabral-Guevara, Jacque, Nass, Tomczyk and Quinn

lower

18 primary · 0 co-sponsors