Ways and Means

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.

This bill modifies Wisconsin's income and franchise tax rates for both individuals and corporations while establishing a new School Aid Fund to support education. It creates a separate trust fund that receives annual transfers from the general fund, with specific provisions for supplemental school aid and revenue limits for school districts. The tax structure introduces graduated rates for higher income levels, with individual and corporate brackets adjusted to increase percentages on income exceeding certain thresholds, and includes provisions for partnerships to elect entity-level taxation. Changes take effect for taxable years beginning after December 31, 2025, with some rates already set for 2026.

This bill creates a state income tax credit for property taxes paid by senior citizens aged 65 and older who own and live in their principal dwelling. The credit allows eligible claimants to offset 75% of their annual property taxes against their state income tax liability, with any unused portion potentially refunded through a state appropriation. To qualify, a household's income must be under $24,500 and the home's assessed value must be below $300,000, while also excluding those who already receive other property tax credits or live in leased properties. The legislation also establishes administrative procedures for claiming the credit through state tax forms and limits eligibility to Wisconsin residents who file by the standard deadline.

AB 685 allows Wisconsin taxpayers to subtract certain theft losses from their state income tax when those losses are already deductible under federal tax rules (specifically IRS Section 165(c)(2) or (3)). It directly affects individuals who experience qualifying theft losses, such as stolen property, that meet federal deduction criteria. The bill creates a new state tax subtraction provision (statute 71.05(6)(b)57) for these losses, while clarifying that taxpayers cannot claim both this subtraction and a separate casualty loss deduction for the same loss. This aligns Wisconsin's tax treatment with federal rules for theft-related deductions, without creating new federal standards.

AB 619 creates a $150 million grant program to fund aviation biofuel manufacturing projects in Wisconsin, funded through state public debt issuance. The bill requires grantees to use facilities exclusively for aviation biofuel production (with limited exceptions for other biofuels if 80% of output is aviation fuel), source 80% of biomass locally, and invest at least $1.5 billion in aviation biofuel manufacturing within five years. It directly affects companies building such facilities and the Department of Natural Resources, which administers the grants. The program aims to support the state's forest products industry and create jobs, with strict repayment terms if grantees fail to meet requirements.