How retirement income is taxed in Wisconsin
Wisconsin taxes retirement income at progressive rates up to 7.65%. Here's what that means for your retirement plan and how to manage it.
Retirement tax landscape
Social Security is fully exempt. Retirement account withdrawals get a $24,000/$48,000 exclusion 67+.
Understanding how Wisconsin treats each type of retirement income is essential for planning your withdrawals, conversions, and Social Security timing. The interaction between state and federal taxes determines your true after-tax income each year.
What's taxed and what's not
Fully exempt from state income tax.
Partially exempt with deductions or exclusions.
Fully taxable as ordinary income.
Qualified distributions are fully exempt at both the state and federal level.
Tax brackets
Wisconsin runs four progressive brackets, with rates from 3.5% to 7.65%. The schedule below switches by filing status; standard deduction is shown beneath each.
| Taxable income | Rate |
|---|---|
| Up to $14,680 | 3.5% |
| $14,680 – $29,370 | 4.4% |
| $29,370 – $323,290 | 5.3% |
| Above $323,290 | 7.65% |
| Taxable income | Rate |
|---|---|
| Up to $19,580 | 3.5% |
| $19,580 – $39,150 | 4.4% |
| $39,150 – $431,060 | 5.3% |
| Above $431,060 | 7.65% |
| Taxable income | Rate |
|---|---|
| Up to $14,680 | 3.5% |
| $14,680 – $29,370 | 4.4% |
| $29,370 – $323,290 | 5.3% |
| Above $323,290 | 7.65% |
Wisconsin's rates are relatively high, with the top rate of 7.65% affecting retirees with moderate to high income.
Strategies to reduce your tax burden
Wisconsin's $24,000/$48,000 retirement-income exclusion at age 67 reshapes the math: convert Roth balances before 67, sequence withdrawals carefully, and time Social Security around the exclusion.
Roth conversions before retirement. Converting traditional IRA balances to Roth during lower-income years means paying Wisconsin tax now at lower rates, then taking tax-free Roth withdrawals later. See the full Roth conversion playbook.
Withdrawal sequencing. The order you draw from different accounts each year matters. Drawing from taxable brokerage accounts before tapping tax-deferred accounts can keep your Wisconsin ordinary income lower. Read more in our drawdown sequencing playbook.
Social Security timing. Optimizing when you claim Social Security affects both your federal and state tax picture. See when to start Social Security.
Modeling your retirement taxes
The interaction between Wisconsin's tax rules and federal taxes is too complex to estimate by hand. A year-by-year projection shows your actual tax burden for every year of retirement.
Drawdown Arc's projection engine includes Wisconsin's full bracket structure, standard deduction, and retirement income exemptions. Set your state to Wisconsin and enter your account balances, pension, and Social Security timing: the projection shows your Wisconsin state tax alongside federal tax for every year.
State tax modeling is a Pro feature. The free calculator shows your full federal tax projection: upgrade to Pro to add Wisconsin (or any of the 50 states + DC) to your model.