Key figures
Wisconsin payroll
2026, with sources
Withholding
Wisconsin withholds income tax by bracket — 3.50% to 7.65% — from employees on Form WT-4. Employers deposit and report on Form WT-6 on the schedule DOR assigns (quarterly, monthly or semi-monthly), filing even when no tax was withheld, and reconcile the year on Form WT-7 with W-2s by January 31. Wisconsin has reciprocity with Illinois, Indiana, Kentucky and Michigan; residents of those states file Form W-220 with the employer.
Wisconsin wants a copy of the W-2 for anyone who is a Wisconsin resident (wherever they worked), anyone who worked in Wisconsin, and anyone you withheld Wisconsin tax from.
Unemployment, wages and workers’ comp
DWD charges UI on the first $14,000 of each employee’s wages. For 2026 a new employer with payroll under $500,000 pays 3.05% and one at $500,000 or more pays 3.25%, for its first three years. New hires are reported within 20 days.
Wisconsin’s minimum wage has been $7.25 since 2009. Wages must be paid at least monthly with no more than 31 days between paydays, and a departing employee is paid on the regular schedule. There is no state paid family leave or sick leave program.
A first Wisconsin hire
Consider a startup that hires two Milwaukee engineers: it registers with DOR for withholding, opens a DWD account at 3.05%, reports both hires within 20 days, and once its two employees have been paid $500 in a calendar quarter (or it hires a third person) it must carry workers’ compensation.
Its payroll carries no local income tax — Wisconsin cities and counties don’t levy one — but if it later hires someone who lives in Minnesota and works in Wisconsin, it withholds Wisconsin tax, because the two states have had no reciprocity agreement since 2010. A Chicago-area hire living in Illinois, by contrast, gives Form W-220 and is taxed only by Illinois.
Deadlines
- As assigned by DORWithholding deposit report (monthly, quarterly or semi-monthly filers), filed even with no tax withheldWT-6
- Jan 31Annual reconciliation, with W-2sWT-7
- End of the month after each quarterQuarterly UI contribution and wage report to DWD
- Within 20 daysNew-hire report
The federal baseline
This page covers what Wisconsin adds. The federal rules underneath it apply here too.
Common questions
Do we withhold Wisconsin tax from someone who commutes in?
Not if they live in Illinois, Indiana, Kentucky or Michigan — Wisconsin has reciprocity with those four, and the employee files Form W-220 so you can skip Wisconsin withholding. Minnesota is different: the Wisconsin–Minnesota reciprocity agreement ended in 2010, so a Minnesota resident working in Wisconsin has Wisconsin tax withheld.
What will Wisconsin unemployment cost us?
The new-employer rate for 2026 is 3.05% if your payroll is under $500,000 and 3.25% if it is $500,000 or more, on the first $14,000 of each employee’s wages. New employers keep that rate for three years before experience rating starts.
Payroll next door
- ILIllinois payrollIllinois withholds a flat 4.95%, charges UI on the first $14,250, and requires 40 hours of paid leave — or Chicago’s 40 plus 40, at Chicago’s higher minimum wage.
- IAIowa payrollIowa withholds a flat 3.8%, cut its 2026 unemployment wage base to $20,400 with a 1.0% new-employer rate, and requires new hires reported within 15 days.
- MIMichigan payrollMichigan withholds a flat 4.25%, charges new employers 2.7% UI on the first $9,000, pays $13.73 an hour in 2026, requires paid sick time from every employer and has 24 city income taxes.
- MNMinnesota payrollMinnesota added a 0.88% Paid Leave premium in 2026 (0.66% for small employers), charges UI on the first $44,000, requires earned sick and safe time and sets a $11.41 minimum wage.
How Wisconsin compares
- No tax on wagesStates with no state income tax on wagesWisconsin: withholds state income tax. 9 of 51 states are on the list.
- Paid leave payrollStates with a paid leave or disability payroll programWisconsin: no state program. 16 of 51 states are on the list.
- Local payroll taxStates with city, county or district payroll taxesWisconsin: state-level only. 14 of 51 states are on the list.
Founder guides on this
- PeopleContractor or employee? Classification for startupsContractor or employee depends on control, not the contract. The IRS test, state rules, 1099s, payroll registration and the cost of getting it wrong.
- ComplianceFirst-year compliance calendar for a Delaware C-corpDelaware franchise tax, 1099s, the federal return, payroll filings, state annual reports and sales tax: the deadlines a young C-corp misses most, by month.
More of the Wisconsin guide
- AccountingAccounting and state tax in WisconsinCorporate tax, conformity to federal rules, apportionment and what it does to your books
- ReceivablesReceivables and sales tax in WisconsinSales tax registration, economic nexus, whether SaaS is taxable, and collecting from customers
- PayablesPayables and contractors in WisconsinPaying vendors and contractors: 1099 filing, use tax, contractor tests and withholding
- ComplianceCompliance and filings in WisconsinRegistering to do business, annual reports, franchise tax and the filing calendar
- AdvisoryAdvisory: credits and decisions in WisconsinCredits, incentives and the decisions that are cheaper to get right the first time
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.