Wisconsin Corporate Franchise and Income Tax: 7.9% and the Manufacturing Credit

If you form a C corporation in Wisconsin, the state corporate tax is the recurring cost that matters most after your filing fee. Wisconsin charges a flat 7.9% on corporate income, and in most cases there is no separate annual franchise tax bill on top of it. Manufacturers and agricultural operators may also qualify for the Manufacturing and Agriculture Credit, which can reduce that tax. This guide covers what each piece means, what it costs, and where to confirm the details before you file.

Informational content only: This guide is general information, not legal or tax advice. Your tax treatment depends on your entity type, your income, and your specific facts. Talk with a qualified CPA or tax attorney before you file, make an election, or claim a credit.

The Wisconsin corporate tax rate

The Wisconsin corporate tax rate is 7.9%. It is a flat rate applied to the taxable income of C corporations. Wisconsin calls this the franchise or income tax, so the "Wisconsin franchise tax" and the "Wisconsin corporate income tax" refer to the same charge at the same rate. The 2025 Act 15 changes did not alter this rate.

Because the tax is calculated on income, the amount you owe depends on your taxable income after allowable deductions and credits. Gross revenue and the number of shareholders do not drive the calculation. A corporation that owes Wisconsin income tax for a year will also owe the economic development surcharge if its gross receipts reach the threshold described below.

Why the franchise tax is not a separate annual fee

Some states charge an annual franchise or privilege tax simply for existing as an entity, whether or not the entity earns money. Wisconsin does not. The Wisconsin franchise tax is the same 7.9% corporate income tax described above, and it is paid only when the corporation has taxable income to report.

The recurring state charges for a Wisconsin entity are small and easy to budget:

• Corporations: A $25 Business Corporation Annual Report (Form 17) is required each year. Filing on paper adds a $15 surcharge, for $40 by mail. The report is due during the calendar quarter that contains the anniversary of incorporation.
• LLCs: Wisconsin imposes no separate LLC franchise or privilege tax. The $25 Limited Liability Company Annual Report (Form 5) is the only recurring state entity charge, and paper filing also adds $15.

Entity formation fees are separate one-time costs. The Articles of Incorporation for a stock, for-profit corporation (Form 2) carry a $100 filing fee, and Articles of Organization for an LLC (Form 502) carry a $130 filing fee online ($170 on paper). Both are filed with the Department of Financial Institutions (DFI), not a Secretary of State.

How the tax applies to each entity type

Your entity classification determines whether the 7.9% rate applies to you at all. The table below summarizes the default treatment. Your classification can change by election, so confirm your status with a CPA before relying on it.

Entity type	Wisconsin income tax treatment	Recurring state entity charge
C corporation	7.9% flat franchise or income tax, plus the economic development surcharge if gross receipts are $4 million or more	$25 annual report ($40 by mail)
Multi-member LLC (default)	Taxed as a partnership. Profits flow through to the owners' Wisconsin individual income tax at 3.50% to 7.65%.	$25 annual report ($40 by mail)
Single-member LLC (default)	Disregarded entity. Income is reported on the owner's Wisconsin individual income tax at 3.50% to 7.65%.	$25 annual report ($40 by mail)
LLC that elects corporate treatment	Taxed at the 7.9% corporate rate, plus the surcharge if applicable	$25 annual report ($40 by mail)

The individual rates are graduated, so the 3.50% to 7.65% range reflects the brackets, not a single rate. An LLC owner who pays individual tax at the top bracket may want to compare the outcome with a corporate election. That comparison depends on your income, distributions, and other facts, so run the numbers with a CPA before making the election.

The economic development surcharge

Wisconsin adds an economic development surcharge for corporations with gross receipts from all activities of $4 million or more. The surcharge is authorized under section 77.94 of the Wisconsin Statutes. Check with the Department of Revenue for the current computation and any cap before you estimate the surcharge.

If your gross receipts are approaching $4 million, contact the Department of Revenue (DOR) before the tax year closes and ask how the surcharge is computed and whether a cap applies. Plan for it in your projections instead of treating $4 million as a remote threshold. Crossing it can change your tax picture in a single year.

The Manufacturing and Agriculture Credit

The Wisconsin manufacturing and agriculture credit, often searched as the Wisconsin manufacturing and agriculture credit, equals 7.5% of eligible qualified production income from Wisconsin property assessed as manufacturing or agricultural. Three features matter most when you estimate it:

• No dollar cap: The credit is not limited to a fixed dollar amount.
• Income limit: The credit is limited to the tax on that income. It cannot exceed the tax attributable to the qualified production income.
• Property requirement: The income must come from Wisconsin property that is assessed as manufacturing or agricultural property.

Here is an illustration with round numbers. Suppose a corporation has $200,000 of qualified production income from qualifying Wisconsin property. The 7.5% credit on that income would be $15,000. The corporate rate on the same $200,000 is 7.9%, or $15,800, so the $15,000 credit fits under the limit in this simplified example. The actual computation depends on how qualified production income is defined and how the limit is applied, so treat this as a sketch, not a calculation you can file.

Before you assume you qualify, work through three questions:

1. Is the property you use to produce income assessed as manufacturing or agricultural property in Wisconsin?
2. Does the income you want to count fall within the statutory definition of qualified production income?
3. If you file as part of a group, which entity holds the qualifying property and which entity earns the income?

Confirm the definitions, the eligibility rules, and the claiming steps with DOR. The DOR business page is at revenue.wi.gov. A CPA who works with Wisconsin manufacturers or farms can also tell you whether the credit fits your operations and how it interacts with your other credits.

Combined reporting for related corporations

Wisconsin uses combined reporting for related corporations that operate as a unitary business. In practice, a parent corporation and its subsidiaries may need to report their income together as one group rather than each filing a separate return as if it stood alone. Combined reporting can change the taxable base, the surcharge calculation, and the way the manufacturing and agriculture credit is applied across the group.

If you own more than one corporation or plan to create subsidiaries, ask a CPA whether your group must combine, and document how intercompany transactions are handled before the first return is due. Do not assume each entity files alone just because each one has its own DFI filing.

Practical steps to confirm your numbers

1. Confirm your entity status with DFI. Use the DFI business search to check your entity record, and file your annual report through the DFI online filing page to avoid the $15 paper surcharge.
2. Register with DOR. Start a new business registration through the DOR new business page, or use the Wisconsin One Stop Business Portal, which registers a new business with DFI, DOR, and the Department of Workforce Development in one pass.
3. Track gross receipts. Monitor your gross receipts from all activities each year so you know early whether the $4 million surcharge threshold is in reach.
4. Document your property and production income. If you may claim the manufacturing and agriculture credit, keep records that show which Wisconsin property produced the income and how it is assessed.
5. Get professional review. Have a Wisconsin CPA review your entity classification, the surcharge, combined reporting, and the credit before you file your first return and again whenever your structure changes.

For help with the basics of registration and recordkeeping, the Wisconsin Small Business Development Center Network offers free advising at wisconsinsbdc.org. An SBDC advisor can point you to the right questions, but they do not replace a tax professional for the computations in this guide.

What to confirm with the agencies

Several items in this guide need confirmation with the agency that administers them rather than a figure you should rely on from an article:

• The computation of the economic development surcharge under section 77.94, including any cap, from DOR.
• The definition of qualified production income and the procedure for claiming the manufacturing and agriculture credit, from DOR.
• The combined reporting rules that apply to your group, from DOR or your CPA.
• Current annual report due dates and fees, from DFI at dfi.wi.gov.

Wisconsin's tax rules can change from one legislative session to the next. Verify the rate, the surcharge, and the credit against the current agency pages before you make a decision, and treat this guide as a starting point for those conversations rather than the final word.

Bottom line

Wisconsin's corporate franchise or income tax is a flat 7.9% on C corporation income, with an economic development surcharge for corporations with $4 million or more in gross receipts. It is not a separate annual franchise fee. Your recurring state entity cost is typically the $25 annual report. The Manufacturing and Agriculture Credit equals 7.5% of eligible qualified production income from qualifying Wisconsin property, with no dollar cap but a limit tied to the tax on that income. Combined reporting can change the picture for related companies. Confirm the details with DFI and DOR, and work with a qualified CPA or tax attorney before you file.