Question 1

What is Wisconsin's state income tax rate for 2025?

Accepted Answer

Wisconsin taxes personal income under a 4-bracket progressive structure for tax year 2025: 3.50%, 4.40%, 5.30%, and a top marginal rate of 7.65% at single-filer thresholds of $14,680 / $29,370 / $323,290, imposed by Wis. Stat. §71.06. The 2nd-bracket rate reduction (from prior levels) reflects 2023 Wisconsin Act 19 and continued adjustments in the 2025-27 biennial budget; brackets are inflation-indexed annually per Wis. Stat. §71.06(2e) using the CPI-U. Wisconsin applies separate schedules to head-of-household and married-filing-jointly filers, with MFJ thresholds approximately doubled.

Question 2

What is Wisconsin's standard deduction for 2025?

Accepted Answer

Wisconsin's standard deduction for tax year 2025 is $14,260 for single filers, $18,410 for head-of-household, and $26,390 for married-filing-jointly, under Wis. Stat. §71.05(22). The Wisconsin standard deduction phases out as Wisconsin AGI rises: single filers begin losing the deduction at approximately $19,180 of AGI and fully lose it around $128,880; MFJ filers phase out between approximately $26,940 and $148,650. This slide-out structure means many middle-income Wisconsin filers receive a partial deduction rather than the full published amount.

Question 3

Does Wisconsin tax Social Security and retirement income?

Accepted Answer

Wisconsin fully exempts Social Security benefits from state income tax under Wis. Stat. §71.05(1)(a). Wisconsin also exempts up to $5,000 of retirement income per taxpayer age 65 or older with federal AGI at or below $15,000 single / $30,000 MFJ under Wis. Stat. §71.05(1)(am), and fully exempts Wisconsin Retirement System pensions attributable to service before January 1, 1964, Milwaukee city and county retirement, and federal military retirement pay under §71.05(1)(a)-(am).

Question 4

Do Wisconsin cities charge a local income tax?

Accepted Answer

No. Wisconsin municipalities and counties do not levy a local income tax under Wis. Stat. §66.0602 (which limits local taxing authority). Local tax burden in Wisconsin comes primarily from property taxes and the state 5.0% sales tax combined with county sales taxes of 0.5% (adopted in 68 of 72 counties) and premier resort area taxes, producing a combined average state-plus-local sales tax rate of approximately 5.7% under Wis. Stat. §77.52.

Question 5

What is Wisconsin's Homestead Credit?

Accepted Answer

Wisconsin's Homestead Credit, established by Wis. Stat. §§71.51-71.55, is a refundable property-tax-relief credit for lower-income Wisconsin residents (both homeowners and renters) with household income at or below $24,680 for tax year 2025. The maximum credit is $1,168 and is calculated as a share of property taxes paid (or 20% of rent paid, treated as property-tax equivalent) above a threshold percentage of household income. Because the credit is refundable, filers with no Wisconsin income-tax liability still receive the full amount. Wisconsin also offers a separate Married Couple Credit under §71.07(6) of up to $480 to reduce marriage-penalty effects when both spouses have earned income.

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