Starting a Business in Wisconsin
Not only famous for its cheese, Wisconsin is also consistently ranked in the top states in the nation for economic vibrancy. With the Manufacturing and Agricultural industries historically being the strongest, now Financial and Health Services have moved to the lead. Other industries such as Education and Food Establishments have also experienced substantial growth in many cases due to Wisconsin benefits programs. Wisconsin companies can benefit from many different incentive opportunities. The most common programs are given through tax incentives, exemptions, grant programs, and benefits to companies who reside inside a Wisconsin Enterprise Zone or Opportunity Zone.
STEPS TO STARTING A BUSINESS IN WISCONSINAfter starting a business in Wisconsin there are some important activities that can be performed. You can select a business name and setup a company with the Wisconsin Secretary of State which governs business filings. Once you have your documents such as Articles of Incorporation or Organization, you will be able to obtain an EIN. A very important step would be to apply online for a Wisconsin Seller’s Permit so you can collect sales tax. This permit is necessary and is paramount in meeting compliance needs. It will also allow you to file a sales tax return with the Wisconsin Department of Revenue who oversees tax policies. One of those policies is setting Wisconsin sales tax rates which can be found online. With those rates the correct amount of Wisconsin sales tax can be paid. Other important actions that can be taken are checking on the status of Form BTR-101: Wisconsin Business Tax Registration and researching the correct Business Licenses required to remain compliant. It also may be necessary to apply for SST streamlined sales tax if you make sales into other states. Here are the advantageous incentive programs available to Wisconsin businesses:
- The Wisconsin Agricultural and Manufacturing Credit is made available to an individual or company within those industries. To qualify a company must engage in eligible production activities. A company may take the credit against corporate income tax and the individual may take the credit against personal income tax.
- Wisconsin has a business development program used to help a company with its employee training expenses and job creation, creating or relocating to a headquarters facility, and making capital investments. To qualify a company must have continued growth of its workforce.
- The standard credit rate is 50% of training expenses or a credit of 10% of annual pay per newly created job as long as workers are earning 1.5 times that of the minimum wage set at the federal level.
- A credit of 10% of annual pay per newly created job located at corporate headquarters.
- A capital investment into a property will yield a 5% credit of the total capital expenses. A capital investment into tangible personal property will yield a 3% return.
- The Wisconsin Opportunity Zone Program provides benefits to businesses that either expand or relocate to specific cities. Any business willing to situate itself inside an opportunity zone can take advantage of a tax credit. The objective is to stimulate capital investment and bring job growth to these distressed areas.
- The Wisconsin Enterprise Zone Program was created to help promote economic expansion into specifically selected enterprise areas. The objectives are to create jobs and bring capital investment to rehabilitate infrastructure.
- A credit is offered of up to 1% of all supply chain expenses.
- A capital investment into a building will yield a 10% credit of the total capital expenses.
- The final enterprise credit is taken against corporate income tax for any new jobs created inside the enterprise zone. The standard credit rate is 7% per newly created job or 100% of training expenses for any existing jobs.
- Wisconsin Sales Tax Exemptions are offered to a business that meets certain standards.
- These include an exemption on utilities such as fuel, water, and electrical power of consumed in the manufacturing process.
- An exemption is available for components and parts used in the manufacturing of tangible personal property.
- A Sales Tax Exemption is given on new or replacement equipment and machinery used in the manufacturing and distribution process.
- The cost of equipment and machinery used in a biotechnology capacity qualify for an exemption. To qualify for all exemptions a seller’s permit is required.