Wisconsin is not a great state when it comes to taxes. They have income tax, business tax, and also one of the highest property tax rates in the country. They additionally have a second business tax called the Economic Development Tax which is a gross receipts tax.
State Taxes at a Glance – Wisconsin
| Type of Tax | 2023 |
|---|
| Individual Rates | 3.54% to 7.65% |
| Corporate / Business Tax Rates | 7.90% flat tax |
| Gross Receipts Tax | Yes |
| Sales Tax | 5.43% (average) |
| Property Taxes | 1.63% as a percentage of primary home |
| Estate or Inheritance Tax | None |
State Income Taxes in Wisconsin
Similar to the majority of other states, the state of Wisconsin does have an individual income tax. Like most states with income tax, it is calculated on a marginal scale (four tax brackets) whose range is from 3.54% to 7.65%. The highest bracket of 7.65% starts for income greater than (approx.) $300,000.
State Business Taxes in Wisconsin
The state of Wisconsin has a flat Corporate Tax rate of 7.90%. Their corporate tax is often referred to as the Wisconsin Franchise Tax which is assessed against Net Income of C Corporations and Interest Income of S Corporations. Other flow-thru entities, such as LLCs and LLPs are not subject to the Wisconsin Franchise Tax.
Economic Development Tax
Additionally, S Corporations and Corporations are also subject to another tax called the *Economic Development Surcharge Tax. The Surcharge Tax is a Gross Receipts Tax on income greater than $4 Million.
Quick overview of Economic Development Surcharge Tax
- C Corp Tax Rate – 3%
- S Corp Tax Rate – 2%
- Maximum annual tax – $9,800
- More information on Wisconsin state website here.
Sales and Property Taxes in Wisconsin
Sales Taxes in Wisconsin – like most states, Wisconsin has both a Local and State sales tax. The State Sales tax rate 5.00%, and the average local sales tax rate is 0.43% (putting the average state sales tax at 5.43%).
Property Taxes in Wisconsin – the average property tax rate for residential property in the state of Wisconsin is 1.73%, making it one of the most expensive states in the union as far as Property Tax as a Percent of a taxpayer’s primary residence.
DMV fees in Wisconsin
Wisconsin’s DMV fees are not based on the value of the vehicle and are therefore not deductible on your federal tax return.
Domicile in Wisconsin
Wisconsin does not use number of days to determine your domicile. Instead, they use the following definition: “A “domicile” is a person’s true, fixed, and permanent home where a person intends to remain permanently and indefinitely and to which a person has the intention of returning, whenever absent. It is often referred to as “legal residence.” A person may be physically present, working or living in one place but maintain a domicile in another. A person has only one domicile at any point in time.”
You may learn more about Wisconsin’s domicile law on their website here.
Social Security Benefits Tax in Wisconsin
Even though there is a state income tax in Wisconsin, they do not assess state income tax on social security benefits.
Payroll Taxes in Wisconsin
Unemployment taxes usually consist of three factors. They are: the wage base, the range of UI rates, number of schedules. Below is an outline of the three:
- Wage Base – Wisconsin has a wage base of $14,000
- UI Rates – range from 0.00% to 12.00% (very high upper bound rate).
- Schedules – Wisconsin has a single rate schedule regarding UI
Wisconsin Business Entities – LLCs
Wisconsin is one of the less expensive states in regards to opening an LLC. Here are some important facts:
- Wisconsin’s annual LLC fee is $25 a year
- When youregister with the state, you pay a one time fee of $130
- Secretary of State of Wisconsin website – click here
Wisconsin Tax Contact Phone Numbers
Important phone numbers for the Washington Department of Taxation:
- Website: www.revenue.wi.gov
- Phone# for Individuals – (608) 266-2486
- Phone# for Businesses – (608) 266-2776