Living in Wisconsin has a lot of perks: low unemployment rates, quickly growing job opportunities, welcoming residents, and beautiful state parks. But if you asked a Wisconsinite, we’d bet that paying taxes isn’t considered one of them.
In fact, the Massachusetts state income tax was just lowered from 5.1% to 5.05%, so you can keep more of your hard-earned money.
Fortunately, Community Tax has made understanding state taxes a lot easier with our free and easy income tax calculator.
Still not confident you’re doing it right? We can file your income taxes for you. Call us or submit a request online for a free tax consultation. The team at our firm knows the ins and outs of Wisconsin taxes for stress-free, timely, and accurate tax filing.
Overview of Wisconsin State Taxes
It may seem like federal and state taxes should be combined into one, but they are split up for a reason. The money collected from taxes is used to pay for resources like healthcare and education.
It’s important that these funds are separately collected on the national and state levels to ensure that the fundamental needs of citizens can be met in both instances.
Whether to impose taxes, and how much to collect, is up to each state. It may be different elsewhere, but Wisconsin requires you to pay state income, sales, and property taxes. In fact, Wisconsin established the first modern income tax system in 1911.
Wisconsin State Taxes: Quick Facts
Income tax: 4% - 7.65%
Sales tax: 5% - 5.6%
Property tax: 1.58% average
Annual 2019 Tax Burden ($75,000/yr income)
Total Estimated Tax Burden
Remaining Income = $63,877
Not sure what it all means to you? That’s what our Wisconsin tax guide is for. We’ve put together an overview of the main tax concepts you’ll need to know when filing your taxes.
There are four tax brackets in the state of Wisconsin with tax rates ranging from 4% to 7.65%, which makes it a little easier to understand than the seven brackets used for federal tax returns. Federal income tax rates range from 10% up to 37%.
If you’re self-employed, meaning you earn income outside of a traditional salaried or hourly job, the Wisconsin tax rate is 15.3% of your taxable income. While this rate might seem high, you are only taxed on 92.35% of your income because you are allowed a 7.65% deduction.
Wisconsin individual income tax rates vary from 4.00% to 7.65%, depending upon marital status and income.
For single taxpayers and taxpayers qualified to file as head of household with taxable income:
But not over
2018 tax is
$458.00 + 5.84%
$1,126.28 + 6.27%
$15,500.66 + 7.65%
For married taxpayers filing a joint return with taxable income:
But not over
2018 tax is
$610.80 + 5.84%
$1,502.57 + 6.27%
$20,667.45 + 7.65%
For married taxpayers filing separate returns with taxable income:
But not over
2018 tax is
$305.20 + 5.84%
$751.38 + 6.27%
$10,333.82 + 7.65%
Stressed about taxes? There may be some good news on the horizon. Based on current state government proposals for tax cuts, it’s possible that the two lowest Wisconsin tax brackets might see a reduction in tax rates in the future.
Wisconsin Personal Income Tax
Whether you live in Wisconsin full time or not, you’ll need to file state income taxes for the money earned inside its borders. But if you’re a low-income earner, then you may be an exception. You don’t have to file if your gross income falls below theminimum requirement that applies to your personal circumstances.
For instance, if you’re a single 21-year-old who only made $8,000 this year, you don’t have to file Wisconsin taxes.
Do You Need to File?
You will need to file taxes in Wisconsin if:
Age as of the End of Year
Part - Year/ Nonresidents
Under age 65
$11,280 or more
$2,000 or more
Age 65 or older
$11,530 or more
$2,000 or more
Married filing a joint return
One spouses under 65 One spouses or older Both spouses 65 or older
$20,980 or more $21,230 or more $21,480 or more
$2,000 or more $2,000 or more $2,000 or more
Married filing separate returns (each spouse)
65 or older
$10,000 or more (applies to each spouse individually-must use Form 1) $10,250 or more (applies to each spouse individually-must use Form 1)
$2,000 or more (combined income of both spouses)
$2,000 or more (combined income of both spouses)
Head of houseold
Under age 65 Age 65 or older
$14,360 or more $14,360 or more
$2,000 or more $2,000 or more
The amount of income tax you’re required to pay will depend on your filing status and income. Wisconsin has four filing statuses as opposed to the five options available for federal taxes: single, married filing jointly, married filing separately, and head of household.
Having a hard time figuring out where to get started? Speak with one of our team members to help make things clear.
If you’d rather not file your taxes on your own, we also offer tax preparation so you don’t have to worry about making an error. From identifying credits and deductions to making sure your taxes are submitted on time, we’re the go-to tax professionals for Wisconsinites.
Note: If you’re a full-time resident, you will file Wisconsin taxes using Form 1. If you’re a non-resident or part-time resident, you’ll need to complete Form 1NPR.
Our pros make filing income tax a breeze, Give us a call!
If you sell an asset and make a profit, it’s considered a “capital gain” for tax purposes. Capital gains are categorized as either short- or long-term under federal law.
It might sound unnecessarily confusing but understanding the difference is simple: if you’ve owned an asset for more than one year, it’s considered a long-term capital gain; assets that are held for under a year are.
In Wisconsin, you can deduct 30% of your net capital gains from your taxable income. If you work in farming or a related industry, you can deduct 60% of capital gains made from the sale of farming assets. The limit for capital gains deductions in Wisconsin is $500.
Calculating capital gains can be difficult because there are many nuances that affect how they are applied to your taxable income. If you’ve sold a large number of assets this year, you can benefit from the assistance of one of our experienced team members who can find you the best tax solution possible.
Note: Reporting your capital gains on your federal and Wisconsin taxes may differ.
Wisconsin State Sales Tax
Imposing sales tax may seem like a sneaky way for the state to get more money when you make purchases, but sales tax is often used to improve roads, education, and more. So at the end of the day, the few extra dollars or cents really benefit the state residents.
Most states have a sales tax but the rate tends to differ from state to state. In Wisconsin, sales tax is charged on goods and services, like the state’s award-winning cheese taxed at 5%.
Each county throughout the state also has the option to charge an additional 0.5% sales tax. So far, over 60 counties have elected to increase their sales tax rate including MIlawukee, Dane, and Waukesha counties, which also happen to be the most populated. This brings the average sales tax to about 5.45% in Wisconsin.
However, some counties have chosen not to implement it such as Manitowoc, Menominee County, Outagamie County, Winnebago County. These counties have the lowest sales tax rates in the state at the baseline 5%.
Milwaukee, Ozaukee, and Washington Counties have the highest sales tax rates in Wisconsin at 5.6%.
Sales vs. Use Taxes
Both Wisconsin sales tax and use tax are incurred at the same rate, they just have different purposes. The difference between sales and use tax is that the retailer is responsible for paying sales tax and the customer is responsible for paying use tax.
You Might Also Have to Pay Stadium Tax
A few counties including Milwaukee, Ozaukee, Racine, Washington, and Waukesha also have a baseball stadium sales and use tax rate of 0.1%. Brown has a football stadium sales and use tax rate of 0.5%.
These stadium taxes are applied in addition to the sales and county taxes. In plain English, this means that any items used, stored, or consumed in the designated stadium zones within these counties, might be taxed at these higher rates.
These taxes were implemented to help fund the development of stadiums. Sporting events can play an important role in a local economy by bringing tourists, media, and more business to the area. Stadiums and sports events also create more job opportunities for locals.
Wisconsin Excise Tax
In addition to sales taxes, certain items carry an excise tax as well.
Why is an excise tax necessary? Generally speaking, the purpose of an excise tax is to create revenue that can then be used to directly fund the needs of society that are caused by the use of the good—which is why— an excise tax wouldn’t be charged on typical necessities.
In the case of cigarettes and alcohol, the excise tax is often referred to as a “sin tax” and is enforced to deter people from engaging in behaviors that may be hazardous to their health.
Cigarettes & Tobacco Excise Tax in Wisconsin
In Wisconsin, a cigarette excise tax of $2.52 is charged per pack of 20 cigarettes.
As efforts to reduce cigarette use amongst Americans become more prevalent, the cigarette excise tax is expected to increase in most states. For instance, in New York, tobacco products are taxed at 75% of the wholesale price and there is an excise tax of $1.50 per pack of 20 cigarettes.
Alcohol Excise Tax in Wisconsin
Bars, clubs, and other establishments that sell beer, wine, and liquor are required to pay excise taxes on the alcohol they serve. As a patron, a portion of that cost is transferred to you, usually concealed in the listed price of your beverage of choice. Wisconsin excise tax on alcohol is approximately:
Beer - $2 per 31 gallon barrel
Wine less than 14% ABV- about $0.07 per liter
Wine 14% - 21% ABV - about $0.12 per liter
Liquor - about $0.86 per liter
Fuel Excise Tax in Wisconsin
The money generated from the gasoline excise tax is often used to construct and improve roadways. Currently, Wisconsin’s gas tax is $0.32 per gallon.
If that sounds like a lot, you might want to consider investing in a fuel efficient vehicle because Governor Tony Evers has proposed an increase of almost an extra dime per gallon by 2121 to fund the expansion of Interstate 43 and other projects. Filling up your car could cost about $5 extra.
Depending on your usage of each of these items, the excise tax may have little to no effect on your budget, or it might be a fairly significant burden.
If you have a long commute to work or smoke a pack of day, you probably pay a lot in excise taxes. On the other hand, the alcohol tax may hardly affect Wisconsinites since it’s unlikely wine or beer is consumed by the liter or barrel.
Wisconsin Insurance Tax
There’s no longer a requirement to have health insurance federally or in the state of Wisconsin, meaning you won’t have to pay a penalty if you don’t have health insurance when you file your federal or state taxes.
Wisconsin State Property Tax
The Badger State is known for its low housing costs, nearly incomparable access to fresh foods with its huge farming industry, and fun-loving culture that enjoys sports events and the great outdoors. In fact, quite a few cities within this Midwestern state rank high on lists of best places to live.
Madison is considered by some to be one of the best places to live for recent college graduates and young professionals due to the surge in tech jobs and its suitability for diverse lifestyles. There are many wonderful reasons why Wisconsinites call the state home, which might help explain why property taxes here are so high.
The effective property tax rate is 1.58%, making Wisconsin one of the states with the highest property tax rates in the nation.
This isn’t the case for every city within the state because each county is able to set their own property tax rate to accommodate their needs. Comparatively, you’ll find that fellow Midwestern state, Illinois, has a much higher average property tax rate of 2.22%.
If it seems like you’re going to owe a lot of money in property taxes, don’t stress just yet. Wisconsin property owners can also qualify for several tax credits that can provide some relief.
If you own or rent in Wisconsin and make less than $24,680 per year, you might qualify for the Homestead Credit Program. It’s worth checking out because you may be eligible for up to $1,168 in credit.
All of these factors make it confusing to try to calculate how much you’re going to owe in property taxes. Working with an experienced agent at Community Tax can prevent frustration, wasted time, and penalties.
Note: When trying to estimate how much property tax you owe, don’t use your home’s listing price. In Wisconsin, property tax is applied to the assessed value of your property.
Property Tax Credits
Property owners in the Badger State can take advantage of credits that are applied directly to your property tax bill such as the:
Lottery and Gaming Credit
First Dollar Credit
School Levy Tax Credit
If you’re a senior citizen, you may also be eligible for a property tax deferral loan through the Wisconsin Housing and Economic Development Authority (WHEDA). Whatever your circumstances, our knowledgeable team members are happy to help you with your property taxes.
We offer professional help with property taxes. Learn more!
Wisconsin taxpayers don’t need to worry about an inheritance or estate tax. So, if you’ve been gifted assets, you can accept them without stressing about having to pay a hefty tax to the state.
Wisconsin State Tax Credits
You can look forward to some relief if you qualify for any of the state’s tax credits. Tax credits are subtracted from your tax bill. With a wide variety of accepted credits, it’s likely you’ll probably qualify for a few including:
Veterans and Surviving Spouses Property Tax Credit
Renters and Property Owner’s School Property Tax Credit
Having a hard time figuring out which credits you can list on your income tax return? That’s what we’re here for. Our tax experts can provide guidance to simplify the process.
Wisconsin State Tax Exemptions and Deductions
You are allowed to claim itemized deductions on your taxes in Wisconsin, even if you’ve claimed standard deductions on your federal income taxes. You’ll want to
make sure you calculate your deductions correctly because they are subtracted from your taxable income and reduce the amount you’ll owe.
Deductions Offered in Wisconsin
There are a variety of deductions available to help lessen the tax burden of Wisconsinites, including:
Home Mortgage Interest Deduction - The interest you have paid on your home mortgage can be deducted. However, the total of your home mortgage debt must be $750,000 or less.
Charitable Contributions - Like Colorado, Wisconsin allows you to deduct charitable contributions. If you’ve donated to charity, you can claim your contributions as part of your itemized deductions on Schedule A. Cash contributions to qualifying organizations can be up to 60% of your adjusted gross income.
Medical Expenses - Medical and dental expenses from the last year that exceed 7.5% of your adjusted gross income can be claimed as an itemized deduction.
While these are popular deductions, this is not an exhaustive list of the deductions you may be able to claim on your state tax return.
Standard vs. Itemized Deductions on Wisconsin Taxes
A standard deduction is a small portion of your income that is not taxed. Based on your filing status and income level, you can use the Wisconsin Standard Deduction Table to determine how much your standard deduction should be. For example, if you’re filing as single and make the average income in Wisconsin, which is approximately just over $55,000, your standard deduction would be $5,780.
On your Wisconsin tax return, you might be able to receive credit for your federal itemized deductions if this number is larger than your state standard deduction. To calculate your total itemized deduction credit, you need to:
The total for your itemized deduction credit will be listed on Schedule 1 of Wisconsin tax Form 1.
If this process seems complicated, you’re not alone. In fact, many Wisconsinites miss out on deductions because they miscalculate or avoid this part of their return all together. Don’t leave free money on the table! Our tax experts can provide guidance or quickly complete your tax form on your behalf. Either way, you can rest assured that we’ll help you take advantage of all of the deductions you qualify for:
Discover more deductions -- speak to a tax pro today!
Trying to accurately calculate your Wisconsin taxes can quickly become anxiety-inducing, especially if it’s your first time filing income taxes. You’re not left to your own defenses when filing your taxes, though. Community Tax is a full-service tax firm that can take the burden off your shoulders. Let one of our team members help you today or use our easy and free Wisconsin income tax calculator to estimate the amount you owe. As the trusted tax firm for many Wisconsinites, we can also provide some helpfultips for filing
Make sure you know the deadline for filing and payment - on or before April 15th (unless it falls on a weekend, then your deadline will be the next business day)
Keep all the documents you will need organized or in one convenient location
Residents will file Form 1
Non-residents and part-time residents will file Form 1NPR
File under the most appropriate status - Wisconsin only has four instead of five (Single, Married filing jointly, Married filing separately, and Head of household)
Make sure you complete all required sections
Report all of your income
Double check all of your calculations and information like the spelling of your name and bank account number
Even if your calculated taxes are more than you can afford right now, you should still file your tax return to avoid paying late filing fees.
How to Pay Wisconsin Taxes
There are three options for paying your Wisconsin taxes if you filed your return online:
Online credit card payment
Check by mail (You Must include Form EPV)
If you mailed in your paper tax return, you need to include a check. Many Wisconsin taxpayers take advantage of the convenient automatic withdrawal which is free and easy to set up. You even get to choose to date that the funds will be withdrawn from your account.
If you cannot pay your full tax bill up-front, you should still try to pay as much as you can to minimize late fees and interest penalties. You may be able to pay off the rest of your balance with a credit card and payment plans are another option to explore. You will have to pay a $29 fee and need to request a payment plan online or by mail. If you’re going to request a payment plan by mail, make sure to include Form A-177 and Form A-177a which should be sent to Compliance Bureau, Wisconsin Department of Revenue, PO Box 8901, Madison, WI 53708-8901.
What Are the Consequences for Not Paying on Time?
Not paying your taxes on time will result in penalties including interest charges of 18% per year. You may also be charged a delinquent collection fee of 6.25%, or at least $35.
Do your taxes seem radically higher than last year, even though none of your tax information has really changed? You may have accidentally miscalculated or missed some important deductions and credits that can make a big impact on what you owe. But don’t worry, our tax professionals can help you sort it out and ensure that your taxes are filed correctly. Request some help online or call us today at (844) 362-5154 for a free consultation.
Fallen behind on state taxes? Get help with tax resolution today!
Wisconsin is one of the few states that taxes residents on internet services
There is a special tax applied to hot air balloon rides, hang gliding, and skydiving
Several counties have additional sales taxes known as “stadium taxes” to help fund the development of professional football and baseball stadiums
Summary of Federal Taxes
You are responsible for filing both federal and state income taxes. Your federal tax dollars are used to pay the salaries of government employees and maintain important resources like national defense, police, and fire departments.
Both federal and state taxes in Wisconsin need to be filed by the April 15th deadline unless you are granted an extension. Remember that your federal and Wisconsin tax brackets will differ so your income will be taxed at different rates.
Call us to stress less and save more on your federal tax refund.
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