Wisconsin offers a variety of tax incentives designed to help businesses reduce costs, create jobs, and invest in growth. These programs support industries ranging from manufacturing and agriculture to technology and research and development. Understanding these incentives can help businesses maximize savings and improve financial planning.
Wisconsin Business Development Tax Credit (BTC)
The Business Development Tax Credit (BTC) provides financial support for businesses that create jobs, invest in Wisconsin, and retain corporate headquarters within the state. This program is designed to encourage economic growth by supporting business expansion efforts.
To qualify for the BTC, businesses must meet certain criteria, including the creation or retention of full-time jobs in Wisconsin, a minimum capital investment of $250,000, or investments in employee training programs. Businesses that meet these criteria can receive refundable tax credits based on the number of jobs created, capital investment, and employee training expenses.
To apply for the BTC, businesses must submit an application to the Wisconsin Economic Development Corporation (WEDC) before starting the project. The WEDC evaluates each application based on the economic impact and potential job creation.
Enterprise Zone Tax Credit
The Enterprise Zone Tax Credit is designed to attract businesses to expand or relocate to Wisconsin’s designated Enterprise Zones. These zones are areas that offer additional financial incentives to encourage economic activity and job creation.
To be eligible for this credit, businesses must make significant capital investments and create or retain jobs in an Enterprise Zone. The amount of the tax credit is based on the project size, job creation, and economic impact of the business.
Businesses that qualify can receive refundable tax credits for job creation, capital investments, employee training, and purchases from Wisconsin-based suppliers. To apply for the Enterprise Zone Tax Credit, businesses must work with WEDC to determine eligibility and secure enterprise zone designation.
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Research & Development (R&D) Tax Credit
The Research & Development (R&D) Tax Credit is an incentive designed to encourage businesses to invest in innovation and technological development. This tax credit is available to businesses that incur qualified R&D expenses in Wisconsin.
Eligible businesses can receive a 15% tax credit for qualified R&D expenses. Additionally, for research related to energy-efficient technologies and internal combustion engines, the credit increases to 11.5%. Businesses can also receive up to 25% of the credit as a refundable tax credit, with unused credits carried forward for up to 25 years.
To apply, businesses must submit documentation of their R&D activities and file the appropriate forms with the Wisconsin Department of Revenue.
Manufacturing and Agriculture Tax Credit
The Manufacturing and Agriculture Tax Credit offers a significant reduction in tax liability for businesses engaged in manufacturing or agricultural production in Wisconsin. This program helps to make Wisconsin a competitive location for businesses in these industries.
To qualify, businesses must be engaged in qualified manufacturing or agricultural production. The credit provides a 7.5% tax credit on income derived from manufacturing or agricultural activities, which can significantly reduce state income tax liability, often to nearly zero.
Businesses must file with the Wisconsin Department of Revenue to claim this credit. Additional details on eligibility and the application process can be found on the official Wisconsin Manufacturing and Agriculture Tax Credit.
Food Processing and Warehouse Investment Credit
This tax credit is designed to support the modernization and expansion of food processing plants and warehouse facilities in Wisconsin. It offers a financial incentive to food manufacturers and warehouse operators investing in new equipment or infrastructure.
The Food Processing and Warehouse Investment Credit provides a 10% tax credit on eligible expenses, with a maximum credit of $200,000 per company. Businesses must apply through the Wisconsin Department of Agriculture, Trade, and Consumer Protection to be considered for this incentive
Property Tax Exemptions for Manufacturing Equipment
Wisconsin offers property tax exemptions on qualifying manufacturing machinery and equipment, helping businesses lower operating costs. Businesses that purchase or upgrade manufacturing equipment in Wisconsin may be eligible for an exemption from local property tax assessments.
To claim this exemption, businesses must apply through their local tax assessor. The Wisconsin Department of Revenue provides further details on eligibility and application requirements.
Additional Wisconsin Tax Incentives
Wisconsin also provides several other tax incentive programs aimed at encouraging workforce development and revitalizing communities, including:
- Veteran Hiring Tax Credit: Provides incentives for businesses that hire and retain veterans.
- Workforce Training Grants: Offsets the cost of employee training and skill development.
- Opportunity Zones: Offers capital gains tax deferrals for businesses investing in designated Opportunity Zones.
For more information about these programs, visit the Wisconsin Tax Incentive Finder.
Conclusion
Wisconsin’s tax incentives provide valuable opportunities for businesses to reduce costs, increase profitability, and drive growth. Programs supporting job creation, research, manufacturing, and workforce training can significantly lower tax burdens and improve financial planning.
To maximize these benefits, businesses should evaluate eligibility, consult tax professionals, and stay informed on updates.
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