State retirement taxes · 2026
Does Wisconsin tax retirement income?
Short answer: Partly. Wisconsin does not tax Social Security benefits. At 67+, up to $24,000 per person of pension and IRA income is subtracted ($48,000 for a couple), if you give up Wisconsin credits.
What’s taxed in Wisconsin
2026 rules.
- Social SecurityNot taxed
- Wisconsin does not tax Social Security benefits.
- PensionsPartly taxed
- At 67+, up to $24,000 per person of retirement income is subtracted ($48,000 if both spouses qualify) — but you give up Wisconsin tax credits that year.
- IRA & 401(k) withdrawalsPartly taxed
- IRA and qualified-plan withdrawals qualify for the $24,000 subtraction at 67+ (credits forfeited) or the low-income $5,000 subtraction at 65+.
- Military retirement payNot taxed
- Military and uniformed services retirement pay (including Coast Guard, NOAA and PHS) is fully exempt.
- Income tax rate7.65% top
- Four indexed brackets for 2026: 3.5%, 4.4%, 5.3% and 7.65%.
Does Wisconsin tax Social Security?
Wisconsin does not tax Social Security benefits.
Social Security benefits are not taxable by Wisconsin; Tier 1 Railroad Retirement is exempt too.
Your federal return is a separate question — see how much of your benefit the IRS taxes with the taxable Social Security calculator.
Are pensions taxed in Wisconsin?
At 67+, up to $24,000 per person of retirement income is subtracted ($48,000 if both spouses qualify) — but you give up Wisconsin tax credits that year.
From 2025, a person who is at least 67 by year-end can subtract up to $24,000 of qualifying retirement income from qualified plans and IRAs, public or private. A joint return gets $48,000 if both spouses are 67+; if only one is, the cap is $24,000 of that spouse’s income. If you claim it, you can’t claim any Wisconsin tax credits that year (including carryforwards). Separately: $5,000 per person at 65+ if federal AGI is under $15,000 single or $30,000 married, and full exemption for federal CSRS and certain pre-1964 Milwaukee and teacher system accounts.
Public vs. private pensions: Treated the same.
Are IRA and 401(k) withdrawals taxed in Wisconsin?
IRA and qualified-plan withdrawals qualify for the $24,000 subtraction at 67+ (credits forfeited) or the low-income $5,000 subtraction at 65+.
Amounts above the subtraction are taxed at regular rates.
Required minimum distributions (RMDs) are IRA and 401(k) withdrawals, so the same rules apply. Estimate your RMD.
Is military retirement pay taxed in Wisconsin?
Military and uniformed services retirement pay (including Coast Guard, NOAA and PHS) is fully exempt.
What is Wisconsin’s income tax rate?
4 brackets, topping out at 7.65%.
Four indexed brackets for 2026: 3.5%, 4.4%, 5.3% and 7.65%. The 5.3% rate covers $51,950 to $332,720 of taxable income single ($69,260 to $443,630 joint).
2026 brackets. Each rate applies to taxable income above the amount shown.
| Single | Married, joint | Rate |
|---|---|---|
| $0 | $0 | 3.5% |
| $15,110 | $20,150 | 4.4% |
| $51,950 | $69,260 | 5.3% |
| $332,720 | $443,630 | 7.65% |
Standard deduction and exemptions
Sliding-scale standard deduction for 2026: $13,960 single, reduced by 12% of income over $20,120 and gone at $136,453; $25,840 joint, reduced by 19.778% over $29,040 and gone at $159,690; $18,030 head of household; $12,280 separate. Personal exemption: $700 per person, plus $250 for each filer 65+.
What tax breaks do seniors get in Wisconsin?
The $24,000 / $48,000 subtraction at 67+ (credits forfeited), the $5,000 low-income subtraction at 65+, and the extra $250 exemption. Wisconsin does not adopt the federal $6,000 senior deduction.
What changed for 2026?
2025 Act 15 created the 67+ retirement subtraction and widened the 4.4% bracket, both from 2025. 2025 Act 174 (April 2, 2026) clarified the age and credit rules. A May 2026 special-session tax bill and a rebate plan failed.
2026 brackets and standard deduction come from the 2026 Form 1-ES instructions.
How Wisconsin compares with its neighbors
Thinking of moving across the line? Here’s how each bordering state treats retirement income in 2026.
- WisconsinThis pageVery friendlySocial Security Not taxedTop rate: 7.65% top
- IllinoisVery friendlySocial Security Not taxedTop rate: 4.95% flat
- IowaVery friendlySocial Security Not taxedTop rate: 3.8% flat
- MichiganVery friendlySocial Security Not taxedTop rate: 4.25% flat
- MinnesotaLess friendlySocial Security Partly taxedTop rate: 9.85% top
State tax is half the picture — check the federal side
Wisconsin retirement tax questions
Is Wisconsin tax-friendly for retirees?
We rate Wisconsin “Very friendly” for 2026. Wisconsin does not tax Social Security benefits. At 67+, up to $24,000 per person of pension and IRA income is subtracted ($48,000 for a couple), if you give up Wisconsin credits. The top income tax rate is 7.65%.
Are required minimum distributions (RMDs) taxed in Wisconsin?
RMDs are withdrawals from IRAs and 401(k)-type plans, so they follow Wisconsin’s rules for those accounts. IRA and qualified-plan withdrawals qualify for the $24,000 subtraction at 67+ (credits forfeited) or the low-income $5,000 subtraction at 65+.
Is military retirement pay taxed in Wisconsin?
No. Military and uniformed services retirement pay (including Coast Guard, NOAA and PHS) is fully exempt.
Should I take Wisconsin’s $24,000 retirement subtraction?
Usually, if you’re 67 or older and have pension or IRA income — but compare both ways. Claiming the subtraction means you can’t claim any Wisconsin tax credits that year, including carryforwards. If your credits are worth more than the tax saved on up to $24,000 ($48,000 for a couple), skip it.
Sources for Wisconsin
Primary sources only. We re-check them whenever an agency publishes new figures.
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