Recent changes to a tax credit program add flexibility as state officials try to incentivize investments in workforce housing and childcare...
Wisconsin updated its Business Development Tax Credit Program via 2025 Wisconsin Act 78 to provide up to a 15% refundable tax credit for investments in workforce housing and childcare. The changes remove the rule that projects must only benefit a company's own workers and permit community-wide third-party investments.
Program Structure and Updates
- Credit Amount: Up to 15% for qualifying capital investments and contributions.
- Effective Date: Applies to taxable years starting on or after January 1, 2026.
- Eligibility Expansion: Allows support for community third parties instead of being restricted to internal employee-only facilities. [Wisconsin Legislative Council ACT MEMO]
Qualifying Investment Types
- Direct Capital: Direct capital expenditures made by the business for building or rehabilitating housing or establishing childcare.
- Nonprofit Contributions: Contributions sent to related mission nonprofits (such as Habitat for Humanity).
- For-Profit Collaboration: Contributions given to for-profit developers handling approved projects.
- Revolving Funds: Investments placed into local revolving loan fund programs (without capital payback to the investing business).
Details and program management guidelines are available directly through the Wisconsin Economic Development Corporation.
Leo'a notes: Incentivizing businesses to invest in housing beyond their own employees could bring an important new source of private capital into community housing efforts. Solving the workforce housing shortage will require employers to become active partners, not simply beneficiaries of new supply.
Ken Notes: Link to WEDC Seminar video at the link.
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