AB969: Bill Text

LRB-3973/1

JK&MES:amn&wlj

2019 - 2020 LEGISLATURE

2019 Assembly BILL 969

February 28, 2020 - Introduced by Representatives C. Taylor, Stubbs, Sargent, Anderson, Cabrera, Considine, Brostoff, Kolste, Sinicki and Bowen, cosponsored by Senators Carpenter and Smith. Referred to Committee on Ways and Means.

AB969,1,7 An Act to amend 71.06 (1q) (intro.), 71.06 (2) (i) (intro.), 71.06 (2) (j) (intro.), 71.06 (2e) (a), 71.06 (2e) (b), 71.06 (2m), 71.06 (2s) (d), 71.125 (1), 71.125 (2), 71.17 (6), 71.64 (9) (b) (intro.), 71.67 (5) (a) and 71.67 (5m); and to create 71.06 (1r), 71.06 (2) (k), 71.06 (2) (L) and 71.06 (2e) (bg) of the statutes; relating to: increasing certain individual income tax rates and expanding the number of brackets, a one-time increase in the general program operations appropriation of the University of Wisconsin System, and making an appropriation.

Analysis by the Legislative Reference Bureau

This bill makes changes to the individual income tax rates and brackets. 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. The rate of taxation under current law for the four brackets, before indexing for inflation, is as follows:

1. For taxable income not exceeding $7,500, 4.0 percent.

2. For taxable income exceeding $7,500, but not $15,000, 5.21 percent.

3. For taxable income exceeding $15,000, but not $225,000, 6.27 percent.

4. For taxable income exceeding $225,000, 7.65 percent.

Under this bill, which first applies to taxable year 2020, 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 is as follows:

1. For taxable income not exceeding $7,500, 4.0 percent.

2. For taxable income exceeding $7,500, but not $15,000, 5.21 percent.

3. For taxable income exceeding $15,000, but not $225,000, 6.27 percent.

4. For taxable income exceeding $225,000, but not $500,000, 7.65 percent.

5. For taxable income exceeding $500,000, 8.25 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.

Finally, the bill requires the Department of Revenue to estimate the increase in revenue in 2021 that results from the changes made in this bill and provides for the general program operations appropriation for the University of Wisconsin System to be increased by that amount for the fiscal year beginning on July 1, 2021.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB969,1 Section 1 . 71.06 (1q) (intro.) of the statutes is amended to read:

AB969,2,7 71.06 (1q) Fiduciaries, single individuals, and heads of households; after 2012 2013 to 2019. (intro.) The tax to be assessed, levied, and collected upon the taxable incomes of all fiduciaries, except fiduciaries of nuclear decommissioning trust or reserve funds, and single individuals and heads of households shall be computed at the following rates for taxable years beginning after December 31, 2012, and before January 1, 2020:

AB969,2 Section 2 . 71.06 (1r) of the statutes is created to read:

AB969,3,2 71.06 (1r) Fiduciaries, single individuals, and heads of households; after 2019. The tax to be assessed, levied, and collected upon the taxable incomes of all fiduciaries, except fiduciaries of nuclear decommissioning trust or reserve funds, and single individuals and heads of households shall be computed at the following rates for taxable years beginning after December 31, 2019:

AB969,3,3 (a) On all taxable income from $0 to $7,500, 4.0 percent.

AB969,3,5 (b) On all taxable income exceeding $7,500 but not exceeding $15,000, 5.21 percent.

AB969,3,7 (c) On all taxable income exceeding $15,000 but not exceeding $225,000, 6.27 percent.

AB969,3,9 (d) On all taxable income exceeding $225,000 but not exceeding $500,000, 7.65 percent.

AB969,3,10 (e) On all taxable income exceeding $500,000, 8.25 percent.

AB969,3 Section 3 . 71.06 (2) (i) (intro.) of the statutes is amended to read:

AB969,3,13 71.06 (2) (i) (intro.) For joint returns, for taxable years beginning after December 31, 2012, and before January 1, 2020:

AB969,4 Section 4 . 71.06 (2) (j) (intro.) of the statutes is amended to read:

AB969,3,16 71.06 (2) (j) (intro.) For married persons filing separately, for taxable years beginning after December 31, 2012, and before January 1, 2020:

AB969,5 Section 5 . 71.06 (2) (k) of the statutes is created to read:

AB969,3,19 71.06 (2) (k) For joint returns, for taxable years beginning after December 31, 2019:

AB969,3,20 1. On all taxable income from $0 to $10,000, 4.0 percent.

AB969,3,22 2. On all taxable income exceeding $10,000 but not exceeding $20,000, 5.21 percent.

AB969,3,24 3. On all taxable income exceeding $20,000 but not exceeding $300,000, 6.27 percent.

AB969,4,2 4. On all taxable income exceeding $300,000 but not exceeding $1,000,000, 7.65 percent.

AB969,4,3 5. On all taxable income exceeding $1,000,000, 8.25 percent.

AB969,6 Section 6 . 71.06 (2) (L) of the statutes is created to read:

AB969,4,6 71.06 (2) (L) For married persons filing separately, for taxable years beginning after December 31, 2019:

AB969,4,7 1. On all taxable income from $0 to $5,000, 4.0 percent.

AB969,4,9 2. On all taxable income exceeding $5,000 but not exceeding $10,000, 5.21 percent.

AB969,4,11 3. On all taxable income exceeding $10,000 but not exceeding $150,000, 6.27 percent.

AB969,4,13 4. On all taxable income exceeding $150,000 but not exceeding $500,000, 7.65 percent.

AB969,4,14 5. On all taxable income exceeding $500,000, 8.25 percent.