Your Responsibilities for Wisconsin Business Taxes

Operating a business in Wisconsin involves a variety of state-level taxes. The specific taxes a company is responsible for depend on its structure, operations, and whether it has employees. The process begins with registering the business with the appropriate state agencies and continues with regular filing and payment duties.

How Business Structure Affects Your Taxes

For sole proprietorships and single-member limited liability companies (LLCs), the business itself does not pay income tax. Instead, the income or losses are “passed through” to the owner’s personal state income tax return and are taxed at individual income tax rates, which range from 3.5% to 7.65%. This structure is often referred to as a “disregarded entity” for tax purposes, as the business and the owner are treated as a single taxpayer.

Partnerships and multi-member LLCs also function as pass-through entities. The business files an informational return, but the profits and losses are allocated among the partners or members, who then report this information on their personal state tax returns. Similarly, S corporations pass their income, losses, deductions, and credits through to their shareholders, who report these items on their personal returns and are taxed at their individual income tax rates.

A significant option for partnerships, multi-member LLCs, and S corporations is the pass-through entity (PTE) tax election. This allows the business to choose to be taxed at the entity level at a flat rate of 7.9%. The main advantage of this election is that the state tax paid by the entity can be deducted as a business expense on the federal return, which can help owners bypass the $10,000 federal limitation on state and local tax deductions. This election is made annually on the entity’s tax return.

C corporations are taxed differently. A C corporation is a distinct legal and taxable entity separate from its owners and is subject to the Wisconsin corporate franchise or income tax at a flat rate of 7.9% on its net income. This can lead to double taxation, where the corporation pays tax on its profits, and shareholders then pay personal income tax on any dividends they receive.

Overview of Key Wisconsin Business Taxes

A primary obligation is the sales tax, a 5% state-level tax on the retail sale, lease, or rental of tangible personal property and certain services. Businesses with a physical or significant economic presence (nexus) in the state must register to collect this tax from customers and remit it to the Department of Revenue.

Many counties impose a local sales tax, often at a rate of 0.5%, and some jurisdictions have special district taxes. The use tax applies to taxable goods and services purchased from out-of-state sellers for use in Wisconsin when no sales tax was paid. The use tax rate mirrors the sales tax rate, and businesses must self-report and pay this tax.

Employers must withhold state income tax from employee wages. This applies to wages paid to Wisconsin residents and to nonresidents for services performed in Wisconsin. The amount withheld is based on the employee’s Form WT-4, and employers must deposit these funds with the Department of Revenue on a semi-monthly, monthly, or quarterly schedule.

Unemployment Insurance (UI) is an employer-paid tax that funds benefits for workers who lose their jobs. An employer is liable for UI taxes if they paid $1,500 or more in wages in a quarter or had an employee for part of a day in 20 different weeks of a year. The 2025 tax rate for new employers is 3.05% on the first $14,000 of each employee’s wages, though this rate can change based on an employer’s claims history.

The corporate franchise or income tax applies to C corporations and LLCs taxed as C corporations. The main distinction between the two is that the franchise tax includes income from federal obligations, like U.S. Treasury bond interest, while the income tax does not. Most corporations in Wisconsin are subject to the franchise tax.

While Wisconsin repealed its business personal property tax, real property like land and buildings remains subject to local property taxes. Under the new law, some items previously classified as personal property, such as certain fixtures and improvements on leased land, are now assessed as real property.

Information Needed for Tax Registration

To register for taxes, businesses use the Wisconsin Business Tax Registration Application (Form BTR-101). This single application is used to obtain a seller’s permit, use tax certificate, and employer withholding tax number.

You will need to provide the following information on the application:

• A Federal Employer Identification Number (FEIN).
• The legal name of the business and any “doing business as” (DBA) name.
• Business contact information, including the physical and mailing addresses.
• Your business structure (e.g., sole proprietorship, partnership, corporation).
• The North American Industry Classification System (NAICS) code for your primary business activity.
• Information for all owners, partners, or corporate officers, including names, Social Security Numbers, and home addresses.
• Key dates, such as the first date of employee wages or taxable sales.
• The business’s bank account information.

How to Complete Your Tax Registration

Businesses can submit their tax registration to the Wisconsin Department of Revenue online or by mail. The online method is the fastest, with processing taking a couple of business days.

To register online, use the Wisconsin Department of Revenue’s “My Tax Account” portal. The system will guide you as you enter the required information into the digital application to ensure all necessary data is captured.

Businesses can also mail a physical copy of Form BTR-101, but this method has a longer processing time of around 15 business days. For either method, there is a $20 business tax registration fee for new businesses, which covers the first two years. After processing, the department will issue the necessary permits and account numbers.

Ongoing Filing and Payment Requirements

After registering, the Department of Revenue will assign a filing frequency for each tax type. Sales and withholding tax periods are assigned as monthly, quarterly, or annually, based on the amount of tax the business is expected to collect or withhold.

The “My Tax Account” online portal is used for managing these obligations. Through this system, businesses can file returns, such as Form WT-6 for withholding or Form S-012 for sales and use tax, by direct entry or file upload.

Tax payments are also managed through My Tax Account via electronic bank payment or credit card. Due dates are tied to the end of the reporting period. For example, a monthly sales tax return and payment are due by the last day of the following month. Adhering to these filing and payment deadlines is fundamental to avoiding penalties and interest charges.