Capital Corner: "March Mad(ison)ness"

Jim Brandenburg, CPA, MST Shareholder - Tax   email | bio 
March 2011

March Madness often serves as the bridge from the long, lingering winter to the first buds of spring. College basketball teams from the around the country hope to get invited to the Big Dance. Next come the brackets and then the buzzer-beaters. Young and old look forward to the excitement. High school tourneys also peak at this time as everyone wants to play at the state tournament in Madison.

But, it looks as if a few others wanted their one shining moment and got a jump start on traveling to Madison. Yes, our state seems to be at center circle of the political universe. It's hard to keep up with the latest developments and predict what will happen next as Wisconsin looks to resolve its budget deficit. Rather than dribble into the full court press and cover legislation in Madison impacting state employee unions, perhaps we can take a shot at covering some recent Wisconsin tax changes. By comparison, there has been little fanfare for the following tax provisions.

• One of the early bills Governor Walker signed provides a tax incentive to small businesses with less than $500,000 of gross receipts, and another bill now permits pretax deposits in health savings accounts in Wisconsin.

• Also included in early legislation is a credit for businesses that relocate all or a significant amount of their workforce to Wisconsin.

• Further, businesses in Wisconsin that increase their employment level are entitled to a deduction of up to $2,000 for each new job added (this deduction is increased to $4,000 for employers with less than $5,000,000 of gross receipts).

• Tax increases will likely not be part of any budget fix in the near future. On February 22, 2011, Governor Walker signed into law legislation requiring a two-thirds majority in both the Assembly and Senate to raise state taxes.

• Other tax proposals are likely as the governor works on the next two-year budget in the coming months.

Look for continued battles in Madison, even if the state senators return. Washington may also soon get in this game as it tackles its own much larger budget woes and stares at a possible government shutdown. All these games, all the political anxiety, all the excitement -- it's too much to handle! March Madness is here! Stay tuned . . .