Does Wisconsin follow the federal no-tax-on-tips and overtime deductions?
DOES NOT CONFORM
Wisconsin does not follow the federal deductions for state income tax. You can still claim the tips and overtime deductions on your federal return (Schedule 1-A) — they simply do not reduce your Wisconsin state tax. Do not assume your state return treats this income the way your federal return does.
Verified against the official state source below — last verified October 26, 2026
| Deduction | Wisconsin position |
|---|---|
| Federal tips deduction (IRC §224) | Does not conform |
| Federal overtime deduction (IRC §225) | Does not conform |
What the state itself says
- Official source
- Wisconsin Department of Revenue, "Wisconsin Tax Update – Fall 2025" (2025 Tax Update presentation, Nov. 3, 2025)
- Tax years covered
- 2025 guidance. The same deck states: "Wisconsin follows the IRC as of December 31, 2022, with certain exceptions" and "Wisconsin has not adopted provisions in the federal One Big Beautiful Bill (OBBB)."
Fixed-date conformity (IRC as of Dec. 31, 2022) plus a federal-AGI starting point; DOR gave explicit per-provision guidance. (The deck notes SB 36 as merely a proposal for a similar Wisconsin tips deduction.) Corroborated by the Legislative Fiscal Bureau memo of Oct. 8, 2025 (docs.legis.wisconsin.gov), prepared in collaboration with DOR.
Your federal deduction is separate
Whatever your state does, the federal deductions run on their own rules: check your W-2 codes with the W-2 Code Checker, estimate with the Tips Calculator and Overtime Calculator, and see the glossary for any term. All state positions: the state-by-state index.
State position verified October 26, 2026 from the official source above. State guidance changes; confirm on the source before filing. This page is general information, not tax advice.