Assembly Bill 17 aims to promote employee ownership in Wisconsin by introducing tax incentives for businesses that convert to employee ownership structures, such as worker-owned cooperatives or employee stock ownership plans (ESOPs). The bill establishes a nonrefundable income tax credit for businesses that incur conversion costs, allowing them to claim 70% of the costs for converting to a worker-owned cooperative or 50% for converting to an ESOP, with a maximum credit of $100,000. Additionally, it creates a capital gains deduction for individuals and corporations transferring ownership of a business to these employee ownership structures, provided that the employee ownership entity owns more than 50% of the business.

Furthermore, the bill mandates the Department of Revenue (DOR) to develop an outreach and education program to facilitate the transition to employee ownership. This program will include technical assistance and training for businesses looking to convert to employee ownership models. The DOR is also directed to apply for federal grants to support this initiative. The bill includes several amendments and new sections to existing statutes, specifically addressing the credits and deductions related to employee ownership conversion costs and capital gains.

Statutes affected:
Bill Text: 71.05(6)(a)15, 71.05, 71.21(4)(a), 71.21, 71.26(2)(a)4, 71.26