Wisconsin Senate Bill SB1112

Wisconsin 2023-2024 Regular Session

• Introduced: 4/11/24
• Refer: 4/11/24
• Failed: 4/15/24

Caption

A refundable income tax credit based on property taxes paid and making an appropriation. (FE)

Impact

This bill is expected to significantly impact state tax laws by creating a new avenue for financial relief for homeowners and renters affected by high property taxes. It is structured in a way that prioritizes low-income individuals, assisting them with their tax burdens by offering a proportional tax credit based on their financial situation. Furthermore, the phased nature of the credit increases the potential for impacted individuals to receive greater relief as the bill matures, reinforcing support for those in need. This legislative change underscores a commitment to alleviating financial strain on residents struggling with housing costs.

Summary

Senate Bill 1112 establishes a refundable income tax credit targeted at individuals facing high property tax burdens relative to their household income. Specifically, it allows for a tax credit for residents whose property taxes or rent (deemed as property taxes) exceed four percent of their household income. The credit is designed to assist lower and middle-income households, with a maximum household income threshold of $150,000. The percentage of the credit offered will gradually increase over the years, starting at 10% in the 2024 tax year, increasing to 15% in 2025, and reaching 40% in 2026 and beyond, contingent upon the amount that exceeds the four percent threshold.

Contention

Points of contention may arise regarding the income thresholds and the phases of the credit. Critics might argue that the income limits set a restrictive barrier that could exclude many who also struggle with property taxes but earn slightly over the threshold. Additionally, there may be discussions surrounding funding for these credits, with concerns on how they will be financed and whether they could lead to increased taxes elsewhere. Some could challenge the fairness of phasing the credit, questioning whether it adequately addresses the immediate needs of eligible claimants who require assistance right away.