Senate Bill 20 proposes an amendment to Wisconsin's earned income tax credit (EITC) regulations, allowing certain married individuals to claim the credit when filing a separate tax return. Currently, married claimants must file jointly to qualify for both the Wisconsin EITC and the federal EITC. The bill introduces a provision that permits a married person to file separately and claim the Wisconsin EITC if they live apart from their spouse and cannot file jointly due to domestic abuse. The bill defines domestic abuse broadly, including physical harm, sexual assault, and actions that instill fear of such conduct. The credit amount is based on the number of qualifying children the claimant has and is equivalent to what they would receive if considered unmarried.

Additionally, the bill amends existing law by removing the restriction that prohibits married persons from claiming the EITC when filing separately, except for those living apart who are treated as single under federal law. The new legal language specifies that for taxable years beginning after December 31, 2024, eligible individuals can receive a percentage of the federal basic earned income credit based on their qualifying children. This change aims to provide financial relief to those affected by domestic abuse, ensuring they have access to tax credits that can support their economic stability.

Statutes affected:
Bill Text: 71.07(9e)(b), 71.07