Key Takeaways of the 2025-2027 Wisconsin State Budget
Wisconsin has enacted several significant changes as part of the 2025–2027 state budget. These reforms aim to provide tax relief to individuals and families, support retirees, encourage adoption, and stimulate economic growth through targeted incentives.
Revised Income Tax Brackets
The income tax brackets have been revised for the 2025 income tax year. Creating a new range of 3.5% to 7.65% compared to 3.54% to 7.65% in 2024.
2025 Single | 2025 Married Filing Jointly | ||||
| 3.50% | > | $0 | 3.50% | > | $0 |
| 4.40% | > | $14,680 | 4.40% | > | $19,580 |
| 5.30% | > | $50,480 | 5.30% | > | $67,300 |
| 7.65% | > | $323,290 | 7.65% | $431,060 | |
Expanded Retirement Income Exclusion
Starting with the 2025 tax year, taxpayers aged 67 or older may exclude up to $24,000 (single filer) and $48,000 (married filing joint) of qualifying retirement income from the Wisconsin taxable income. The prior exclusion was limited based on income and was $5,000 and $10,000, respectively. Caution should be used as certain credits would not be allowed if the exclusion is taken.
Adoption Expense Increase
Adoption expenses allowed as a deduction are increased from $5,000 to $15,000 per child starting with the 2025 income tax year.
Film Credits
To attract more film and television projects to the state, Wisconsin introduced a 30% tax credit for:
- Wages paid to Wisconsin residents, up to $250,000 per employee, excluding the two highest paid employees.
- Production expenditures incurred in Wisconsin (rental, self-construction, local services)
- Capital investments in purchasing or improving property used for production for the first 3 years of production.
An annual state-wide cap of $5 million would be in effect and a limit of $1 million per applicant would be in place. The credit is first available for tax years beginning after December 31, 2025. To monitor the credit and its use, a Wisconsin State Film Office will be established under the Department of Tourism.
Looking Ahead
These legislative changes mark a pivotal shift in Wisconsin’s approach to taxation and economic development. By easing the tax burden on retirees, expanding support for families, and incentivizing creative industries, the state is positioning itself as a more attractive place to live, work, and invest. As most of these Wisconsin updates take effect beginning with the 2025 tax year, individuals should review their financial strategies to take full advantage of the new opportunities. Get in touch with a Wegner CPAs tax advisor to explore how these and other legislative changes may impact your return.
