Office of the Secretary of State
The bill provides that the Office of the Secretary of State is the exclusive office that may affix the great seal of the state of Wisconsin to a document and authenticate the document. The bill also provides that the Office of the Secretary of State must provide apostille services.
Legislature
Popular initiative and referendum
The bill requires the legislature to introduce and vote on a joint resolution providing for a constitutional amendment that creates a petition process by which the people may propose and approve laws and constitutional amendments at an election and that creates a referendum process by which the people may reject an act of the legislature. A proposed constitutional amendment requires adoption by two successive legislatures, and ratification by the people, before it can become effective.
Specifically, the proposed constitutional amendment provides that the people may file a petition with the agency that administers state elections (currently the Elections Commission) for a referendum to reject any act of the legislature, a section of any act, or an item of appropriation in any act.
A petition for referendum must be signed by qualified electors equaling at least 4 percent of the vote cast for the office of governor at the last preceding gubernatorial election. A qualified elector is a U.S. citizen age 18 or older who has resided in an election district or ward in Wisconsin for at least 28 days.
After validating a petition’s signatures, the agency that administers state elections is required to order a referendum at the next general election occurring at least 120 days after the petition was filed with the agency. No act or part of an act rejected in a referendum may be reenacted during the legislative session in which it was rejected.
The proposed constitutional amendment further provides that the people may propose, by petition filed with the agency that administers state elections, laws and constitutional amendments for a vote at an election. The petition must satisfy all of the following conditions:
1. For a petition for an initiative law, be signed by qualified electors equaling at least 6 percent of the vote cast for the office of governor at the last preceding gubernatorial election.
2. For a petition for an initiative constitutional amendment, be signed by qualified electors equaling at least 8 percent of the vote cast for the office of governor at the last preceding gubernatorial election.
3. Include the full text of the proposed law or constitutional amendment prepared in proper form. Upon request by any qualified elector, the agency that administers state elections is required to have the proposed law or constitutional amendment drafted in proper form and made available to the public. The proposed law or amendment must embrace no more than one subject, and that subject must be expressed in the title.
4. Be filed with the agency that administers state elections not less than 120 days before the election at which the proposed law or constitutional amendment is to be voted upon.
Similar to the process for a referendum, after verifying an initiative petition’s signatures, the agency that administers state elections is required to order the submission of the initiative law or constitutional amendment to the qualified electors of the state for their approval or rejection at the next succeeding general election occurring at least 120 days after the petition was filed with the agency.
If approved by a majority of the qualified electors voting at the election, an initiative law or constitutional amendment goes into effect on the 30th day after the date the agency that administers state elections certifies the election results, unless a different effective date is specified in the initiative. The legislature may not repeal or amend an initiative law for the two years immediately succeeding its publication and may not repeal or amend an initiative law except by a vote of two-thirds of all members elected to each house. If an initiative law or constitutional amendment is rejected at the election, substantially the same initiative law or amendment, as determined by the agency that administers state elections, may not be considered again by voters under the initiative process for at least five years.
Legislative intervention in certain court proceedings
Current law provides that the legislature may intervene as a matter of right in an action in state or federal court when a party to the action does any of the following:
1. Challenges the constitutionality of a statute.
2. Challenges a statute as violating or being preempted by federal law.
3. Otherwise challenges the construction or validity of a statute.
Current law further provides that the legislature must be served with a copy of the proceedings in all such actions, regardless of whether the legislature intervenes in the action.
The bill eliminates all of these provisions.
Retention of legal counsel by the legislature
Current law allows representatives to the assembly and senators, as well as legislative employees, to receive legal representation from DOJ in most legal proceedings. However, current law also provides all of the following:
1. With respect to the assembly, that the speaker of the assembly may authorize a representative to the assembly or assembly employee who requires legal representation to obtain outside legal counsel if the acts or allegations underlying the action are arguably within the scope of the representative’s or employee’s legislative duties, and the speaker may obtain outside legal counsel in any action in which the assembly is a party or in which the interests of the assembly are affected, as determined by the speaker.
2. With respect to the senate, that the senate majority leader may authorize a senator or senate employee who requires legal representation to obtain outside legal counsel if the acts or allegations underlying the action are arguably within the scope of the senator’s or employee’s legislative duties, and the majority leader may obtain outside legal counsel in any action in which the senate is a party or in which the interests of the senate are affected, as determined by the majority leader.
3. That the cochairpersons of the Joint Committee on Legislative Organization (JCLO) may authorize a legislative service agency employee who requires legal representation to obtain outside legal counsel if the acts or allegations underlying the action are arguably within the scope of the employee’s legislative duties, and the cochairpersons may obtain outside legal counsel in any action in which the legislature is a party or in which the interests of the legislature are affected, as determined by the cochairpersons.
The bill eliminates these provisions. Under the bill, representatives to the assembly and senators, as well as legislative employees, may continue to receive legal representation from DOJ in most legal proceedings.
Advice and consent of the senate
Under current law, any individual nominated by the governor or another state officer or agency subject to the advice and consent of the senate, whose confirmation for the office or position is rejected by the senate, may not do any of the following during the legislative session biennium in which his or her nomination is rejected:
1. Hold the office or position for which he or she was rejected.
2. Be nominated again for that office or position.
3. Perform any duties of that office or position.
The bill eliminates those restrictions.
Records and correspondence of legislators
Under current law, the Public Records Board prescribes policies and standards for the retention and disposition of public records made or received by a state officer or agency. However, for purposes of public records retention, the definition of “public records” does not include the records and correspondence of any legislator. The bill eliminates that exception for a legislator’s records and correspondence.
Passive review by JCF; objections to be public
Current law requires that JCF review certain proposed actions before an agency may execute the action. The review required often takes the form of a passive review. In a passive review, the agency must submit the proposed action to JCF and if the cochairpersons of JCF do not notify the agency within a certain period, often 14 days, that a member of JCF has objected to the action, the agency may execute the proposed action. If, however, a member objects, the agency is limited to the action as approved or modified by JCF. The bill specifies that the name of any JCF member who objects to the proposed action, as well as the reason the member objects, must be recorded and made publicly available.
Capitol security
Under current law, DOA is required to submit any proposed changes to security at the capitol, including the posting of a firearm restriction, to JCLO for approval under passive review. The bill eliminates that requirement.
TAXATION
Income taxation
Tax exemption for tips
The bill creates an income tax exemption for cash tips received by an employee from the customers of the employee’s employer.
Earned income tax credit
The bill increases the amount that an individual with fewer than three qualifying children may claim as the Wisconsin earned income tax credit (EITC). Under current law, the Wisconsin EITC is equal to a percentage of the federal EITC. The percentage is 4 percent of the federal EITC if the individual has one qualifying child, 11 percent if the individual has two qualifying children, and 34 percent if the individual has three or more qualifying children. The credit is refundable, which means that if the credit exceeds the individual’s tax liability, he or she will receive the excess as a refund check.
Under the bill, the percentage of the federal EITC that an eligible individual may claim for Wisconsin purposes is 16 percent if the individual has one qualifying child, 25 percent if the individual has two qualifying children, and 34 percent if the individual has three or more qualifying children.
Homestead tax credit expansion
Under current law, the homestead tax credit is a refundable income tax credit that may be claimed by homeowners and renters. The credit is based on the claimant’s household income and the amount of property taxes or rent constituting property taxes on his or her Wisconsin homestead. Because the credit is refundable, if the credit exceeds the claimant’s income tax liability, he or she receives the excess as a refund check. Under current law, there are three key dollar amounts used when calculating the credit:
1. If household income is $8,060 or less, the credit is 80 percent of the property taxes or rent constituting property taxes. If household income exceeds $8,060, the property taxes or rent constituting property taxes are reduced by 8.785 percent of the household income exceeding $8,060, and the credit is 80 percent of the reduced property taxes or rent constituting property taxes.
2. The credit may not be claimed if household income exceeds $24,680.
3. The maximum property taxes or rent constituting property taxes used to calculate the credit is $1,460.
Beginning with claims filed for the 2025 tax year, the bill increases the income phase-out threshold from $8,060 to $19,000, reduces the percentage used for household income above the income phase-out threshold to 7.891 percent, and increases the maximum income amount from $24,680 to $37,500. The bill also indexes the $19,000, $37,500, and $1,460 amounts for inflation during future tax years.
Changing the name of the homestead credit
The bill also renames the homestead income tax credit to the property tax and rent rebate.
Veterans and surviving spouses property tax credit eligibility expansion
The bill reduces the eligibility threshold for an eligible veteran, the spouse of an eligible veteran, and the unremarried surviving spouse of an eligible veteran to claim the veterans and surviving spouses property tax credit under the individual income tax system. Under the bill, a claimant may claim the credit if the service-connected disability rating of the veteran for whom the claimant is claiming the credit is at least 70 percent. Currently, that rating must be 100 percent.
Under the bill, the maximum credit that a claimant may claim is multiplied by the percentage of the service-connected disability rating. The bill does not affect a claimant who claims the credit based on the individual unemployability rating. Under current law, a claimant may also claim the credit if the disability rating based on individual unemployability of the veteran for whom the claimant is claiming the credit is 100 percent.
Rent qualifying for the veterans and surviving spouses property tax credit
Current law does not expressly address the treatment of renters for purposes of claiming the veterans and surviving spouses property tax credit. DOR allows an eligible veteran or surviving spouse who is a renter to claim the credit if he or she is required to pay the property taxes under a written agreement with the landlord and pays the property taxes directly to the municipality.
Under the bill, an eligible veteran or surviving spouse who is a renter may claim the veterans and surviving spouses property tax credit in an amount equal to his or her rent constituting property taxes. The bill defines “rent constituting property taxes” to mean 20 percent of the rent paid during the year for the use of a principal dwelling if heat is included in the rent and 25 percent of the rent if heat is not included.
Adding a fifth income tax bracket
The bill adds a fifth income tax bracket having a rate of 9.80 percent for individuals and married joint filers with taxable income exceeding $1,000,000 and for married separate filers with taxable income exceeding $500,000. Under current law, there are four income tax brackets for single individuals, certain fiduciaries, heads of households, and married persons. The brackets are indexed for inflation.
Under the bill, which first applies to taxable year 2025, there are five income tax brackets for single individuals, certain fiduciaries, heads of households, and married persons. The brackets are indexed for inflation. The rate of taxation under the bill for the five brackets for single individuals, certain fiduciaries, and heads of households, before indexing, is as follows:
1. For taxable income not exceeding $7,500, 3.5 percent.
2. For taxable income exceeding $7,500, but not $15,000, 4.40 percent.
3. For taxable income exceeding $15,000, but not $225,000, 5.3 percent.
4. For taxable income exceeding $225,000, but not $1,000,000, 7.65 percent.
5. For taxable income exceeding $1,000,000, 9.80 percent.
The rates that apply to married joint filers under the bill are the same as the rates that apply to single individuals, fiduciaries, and heads of households, but the income limitations are higher. The lowest bracket applies to taxable income not exceeding $10,000; the second bracket applies to taxable income exceeding $10,000, but not $20,000; the third bracket applies to taxable income exceeding $20,000, but not $300,000; the fourth bracket applies to taxable income exceeding $300,000, but not $1,000,000; and the fifth bracket applies to taxable income exceeding $1,000,000.
Increasing the personal exemption
The bill increases from $700 to $1,200 the income tax personal exemption for taxpayers, their spouses, and their dependents.
Manufacturing and agriculture credit limitation
Currently, a person may claim a tax credit on the basis of the person’s income from manufacturing or agriculture. A taxpayer may claim a credit equal to 7.5 percent of the income derived either from the sale of tangible personal property manufactured in whole or in part on property in this state that is assessed as manufacturing property or from the sale of tangible personal property produced, grown, or extracted in whole or in part from property in this state assessed as agricultural property. If the amount of the credit exceeds the taxpayer’s income tax liability, the taxpayer does not receive a refund, but may apply the balance to the taxpayer’s tax liability in subsequent taxable years.
The bill limits to $300,000 the amount of income from manufacturing that a person may use as the basis for claiming the credit. The bill does not affect the amount of income from agriculture that may be used as a basis for claiming the credit.
Film production tax credit
The bill creates income and franchise tax credits for film production companies, and the Department of Tourism implements the tax credit. Under the bill, a film production company may claim a credit that is equal to 25 percent of the salary or wages paid to the company’s employees in the taxable year for services rendered in this state to produce a film, video, broadcast advertisement, or television production, as approved by the Department of Tourism, and paid to employees who were residents of this state at the time that they were paid. The total amount of the credits that may be claimed by a taxpayer may not exceed an amount that is equal to the first $250,000 of salary and wages paid to each of the taxpayer’s employees in the taxable year, not including the salary or wages paid to the taxpayer’s two highest-paid employees in the taxable year, for a production with budgeted expenditures of $1,000,000 or more. If the total amount of the credits claimed by a taxpayer exceeds the taxpayer’s tax liability, the state will not issue a refund, but the taxpayer may carry forward any remaining credit to subsequent taxable years.
Under the bill, a film production company may claim an income and franchise tax credit in an amount that is equal to 25 percent of the production expenditures paid by the company in the taxable year to produce a film, video, broadcast advertisement, or television production. If the total amount of the credits claimed by the company exceeds the company’s tax liability, the state will issue a refund.
The bill also allows a film production company to claim an income and franchise tax credit, for the first three taxable years that the company is doing business in this state, in an amount that is equal to 25 percent of the amount that the claimant paid in the taxable year to purchase depreciable tangible personal property or to acquire, construct, rehabilitate, remodel, or repair real property.
Under the bill, a film production company may claim an income and franchise tax credit that is equal to the amount of sales and use taxes that the claimant paid for tangible personal property and taxable services that are used to produce a film, video, broadcast advertisement, or television production in this state.
The bill provides that the Department of Tourism may not allocate more than $10,000,000 in film production and investments tax credits in each fiscal year. The bill also requires the Department of Tourism to annually submit a report to the legislature that specifies the number of persons who submitted credit applications in the previous year and the amount of the credits allocated to each such applicant and to make recommendations on improving the efficiency of the program. Finally, the bill requires the Legislative Audit Bureau to biennially prepare a performance evaluation audit of the program implemented by the Department of Tourism.
Eligibility of nuclear power research for the research credit
Under the bill, beginning in the 2025 tax year, qualified research expenses incurred for research related to nuclear power are eligible for the research income tax credit. Under current law, the research credit is an income and franchise tax credit equal to a specified percentage of the person’s qualified research expenses that exceed 50 percent of the average qualified research expenses for the three taxable years immediately preceding the taxable year for which the person claims the credit. Current law allows a person to receive a refund in an amount not exceeding 25 percent of their allowable claim for the research credit.
Changes to state supplement to federal historic rehabilitation credit
The bill makes the following changes to the state supplement to the federal historic rehabilitation credit: 1) eliminates the requirement for claiming the credit of incurring at least $50,000 in qualified rehabilitation expenditures; 2) eliminates the requirement that the state credit be claimed at the same time as the claimant claims the federal historic rehabilitation credit; and 3) allows partnerships, limited liability companies, and tax-option corporations to claim the credit and prohibits partners of a partnership, members of a limited liability company, and shareholders of a tax-option corporation from claiming the credit. Current law authorizes WEDC to certify a person to receive a tax credit equal to 20 percent of the qualified rehabilitation expenses, as defined under federal law, for certified historic structures on property located in this state and for the rehabilitation expenses for qualified rehabilitated buildings, as defined under federal law, that are not certified historic structures.
Flood insurance premiums
The bill creates a nonrefundable individual income tax credit for flood insurance premiums. The credit is equal to 10 percent of the amount of the premiums that an individual paid in the taxable year for flood insurance, but the amount of the claim may not exceed $60 in any taxable year. Because the credit is nonrefundable, it may be claimed only up to the amount of the individual’s tax liability.
Private school tuition deduction
Under current law, an individual, when computing income for income tax purposes, may deduct the tuition paid during the year to send his or her dependent child to private school. The maximum deduction is $4,000 for an elementary school pupil and $10,000 for a secondary school pupil.
