www.WisVets.com/Taxes

Property Tax Credit | Taxation of Military Pay | Combat Pay Extension
Mobilized Reserve/Guard Pay Exemption | Filing Extension | Retirement Benefits Exemption
Death Gratuity Exemption | Taxes and the Members of the Military

Wisconsin Veterans and Surviving Spouses Property Tax Credit

The Wisconsin Veterans and Surviving Spouses Property Tax Credit provides eligible veterans and unremarried, surviving spouses a refundable property tax credit for their primary, in-state residence.

The Wisconsin Department of Veterans Affairs verifies the veteran’s eligibility for the program. The credit is administered by the Wisconsin Department of Revenue through the state income tax return.

For taxable years beginning on or after January 1, 2007, and through December 31, 2008:

An eligible veteran is at least 65 years of age and meets the following criteria:

• Was a Wisconsin resident when entering active duty.
• Served on active duty under honorable conditions in the U.S. armed forces.
• Is currently a Wisconsin resident for purposes of receiving veterans’ benefits under Ch. 45, Wisconsin Statutes.
• Has a service-connected disability (SCD) rating of 100% under 38 USC 1114 or 1134 from the U.S. Department of Veterans Affairs (VA).

An eligible, unremarried, surviving spouse of one of the following veterans may be eligible for this credit:

• The veteran served on active duty in the U.S. armed forces, was a Wisconsin resident when entering active duty, and died on active duty while a Wisconsin resident.
• The veteran served on active duty under honorable conditions in the U.S. armed forces; was a Wisconsin resident when entering active duty; was at least 65 years of age at the time of death or would have been 65 years of age at the close of the year in which he or she died; was a Wisconsin resident at the time of death; and had an SCD rating of 100% under 38 USC 1114 or 1134.
• The veteran served in the National Guard or Reserves, was a Wisconsin resident when entering active duty, and, while a Wisconsin resident, died in the line of duty while on active or inactive duty for training purposes.

For taxable years beginning on or after January 1, 2009:

The definitions of an eligible veteran and an eligible, unremarried, surviving spouse are expanded to include:

• A veteran, or the surviving spouse of a veteran, who had been a Wisconsin resident for a consecutive 5-year period after entering active duty or was a Wisconsin resident when entering active duty.
• The veteran must have either an SCD rating of 100 percent under 38 USC 1114 or 1134 or a 100% disability rating based on individual unemployability. Individual unemployability means a condition under which a veteran has an SCD rating of either 60% under 38 USC 1114 or 1134 or two or more SCD conditions where one condition has at least a 40% scheduler rating and the combined scheduler rating for all conditions is at least 70%, and has an administrative adjustment added to the SCD, due to individual unemployability, such that the VA rates the veteran 100% disabled.
• The age requirement was eliminated.

Applicants who believe they may qualify should contact their local County Veterans Service Office (CVSO). A list of CVSOs and contact information can be found at www.WisVets.com/CVSO.

For program information, applications and instructions on how to apply, see brochure WDVA B0106. Frequently Asked Questions (FAQs) on this credit are available from the Department of Revenue website.

Wisconsin Individual Income Taxes – Military Pay

Regular pay received by Wisconsin residents serving in the military on active duty or on inactive Reserve duty or in the Wisconsin National Guard is not exempted from income tax.

Proof of filing a Wisconsin income form is frequently one of the components used in determining Wisconsin residency to establish general eligibility for Wisconsin state veterans benefits, the Wisconsin G.I. Bill, the Wisconsin Veterans and Surviving Spouses Property Tax Credit, and Residency for Tuition at UW institutions.

Residents of another state who are stationed in Wisconsin are not subject to Wisconsin income tax on their military pay unless they change their state of residency to Wisconsin.

For additional information on Wisconsin individual income taxes and military pay, see Wisconsin Department of Revenue Publication 104, Wisconsin Taxation of Military Pay and/or Indivdual Income Tax – Military FAQs.

Wisconsin Individual Income Taxes – Combat Pay Exemption

Military pay that is exempt from federal taxation, such as combat pay or hazardous duty pay, is also exempt from Wisconsin state taxation.

For additional information on Wisconsin individual income taxes and military pay, see Wisconsin Department of Revenue Publication 104, Wisconsin Taxation of Military Pay and/or Indivdual Income Tax – Military FAQs.

Wisconsin Individual Income Taxes – Mobilized Reserve/Guard Pay Exemption

For taxable years beginning in 2004 and thereafter, military pay received by certain members of the Reserves and National Guard may also be exempt for Wisconsin tax purposes.

To qualify for the exemption, the military pay must have been received from the federal government after being called into active federal service or into special state service authorized by the federal Department of Defense.

The pay must have been for a period of time during which the Reserve or National Guard member was on active duty. This exemption does not apply to military pay that members of the Reserves or National Guard receive during their weekend and two-week annual training.

For additional information, see Wisconsin Department of Revenue Publication 104, Wisconsin Taxation of Military Pay.

Wisconsin Individual Income Taxes – Extension in Filing Deadline

For military service members who are serving on active duty, special provisions may apply regarding extensions for filing federal and Wisconsin state income taxes and for interest on taxes due.

For additional information on Wisconsin individual income taxes and extensions to file, see Wisconsin Department of Revenue Publication 104, Wisconsin Taxation of Military Pay.

Wisconsin Individual Income Taxes – Military Retirement Benefits Exemption

Military retirement benefits are exempt from Wisconsin state taxation. See the Department of Revenue’s webpage on Individual Income Tax for Retired Persons.

Wisconsin Individual Income Taxes – Death Gratuity Exemption

The death gratuity paid to the surviving dependent in the event of a line of duty death of a military service member is exempt from Wisconsin individual income taxes.