Wisconsin Budget Includes Corporate Tax Incentives
The Wisconsin budget signed by Governor Scott Walker on June 26th included some tax incentives for Wisconsin businesses. There were changes to capital gains law and increased manufacturing credits.
- Starting in 2011, any long-term capital gains will not be taxable to Wisconsin if the gains are reinvested into a Wisconsin business. The gain must be deposited into a separate account and reinvested in a Wisconsin business within 180 days of the sale. Qualifying businesses are certified by the Wisconsin Economic Development Corporation.
- Any realized capital gains from investing in a Wisconsin business will not be taxable if the taxpayer keeps the investment for five years. This includes capital gains from property used in Wisconsin businesses. Qualifying purchases can be made after 2010 and cannot be sold until after 2015. Qualifying businesses are certified by the Wisconsin Economic Development Corporation.
- Starting in 2013, Wisconsin will allow a credit similar to the federal Domestic Production Activities Deduction. This credit will be open to Wisconsin manufacturers and farmers. The products must actually be produced in Wisconsin; otherwise any business that qualifies for the federal deduction should qualify for the Wisconsin credit. The credit will be phased in at 1.875% of qualifying income in 2013 and ending at 7.5% in 2016.
These incentives were designed to increase investments in Wisconsin businesses in order to improve the state economy and create jobs.