Law tax

Wisconsin to Comply with Most Stimulus Bill Tax Changes

Wisconsin on Wednesday passed omnibus legislation to combat the Covid-19 pandemic, including language that brings the state’s tax code into line with several features of federal coronavirus response law.

Governor Tony Evers (R) signed AB 1038 shortly after it passed the Senate, saying in a statement that it was “finally a step in the right direction, but still remains a lot of work to do “.

The bill helps taxpayers during the public health crisis by complying with new federal rules that: exempt certain distributions from retirement accounts from tax; allow deductions for certain charitable contributions; allow tax-free forgiveness of loans under the federal small business loan program; and exclude from income student loan payments made by an employer to qualified employees.

The bill does not address a stimulus provision (public law 116-136) which temporarily relaxes the limit for deducting commercial interest under article 163 (j) of the tax code of the tax law of 2017. Wisconsin decoupled from this provision in 2018, said Jay Baehman, tax advisor in the Appleton, Wis. Office of Grant Thornton LLP.

  • In addition, the bill gives the Department of Revenue the power to waive interest and penalties in cases where a taxpayer does not pay taxes on time due to the pandemic.
  • AB 1038 won unanimous Senate support on Wednesday. It was adopted by the Assembly on Tuesday by 97 votes to 2.
  • Evers said he would sign AB 1038, but noted the measure “falls short of what is needed to cope with the scale and gravity of what our state is facing. “.