State Records Large Positive GAAP Balance
According to a press release from Gov. Tony Evers (D), Wisconsin’s General Fund recorded its largest positive balance ever, as calculated under Generally Accepted Accounting Principles (GAAP), at the end of the 2020-21 fiscal year. The state ended the most recent fiscal year with a balance of $1.18 billion. The 2019-20 and 2020-21 fiscal years mark the first time that the state has run a GAAP positive balance since the state began publishing its Annual Comprehensive Financial Report (ACFR) in 1990.
As we reported in October, the state ended the 2020-21 fiscal year with a balance of $2.58 billion, a record surplus and more than double the $1.17 billion balance Wisconsin had at the end of the previous fiscal year. Wisconsin’s fiscal year ends on June 30. The budget numbers were part of the state’s Annual Fiscal Report of its finances.
Updated Income Tax Withholding Tables
Gov. Evers announced on January 10 that the Department of Revenue (DOR) had revised Wisconsin’s individual income tax withholding tables, effective January 1 for tax year 2022 and onward. As we reported last year, the Legislative Fiscal Bureau (LFB) released a memo explaining that DOR would update the withholding tables, which were last updated in April 2014.
The 2021-2023 state budget cut income taxes by $2 billion, necessitating changes to the tax rates, brackets, and sliding scale standard deduction. LFB estimates that the updated tables will reduce income tax collections by $709.8 million on a one-time basis in fiscal year 2022. The Legislature included a provision in the budget to revise the withholding tables; Gov. Evers signed the budget but vetoed that provision.
According to the governor’s January 10 press release, under the revised tables, “a single filer making $50,000 will see $551 more in their paychecks while a married couple each earning $50,000 combined will see over $1,200 more for their household in their paychecks.”
Record-High Lottery and Gaming Credit
Gov. Evers announced that 1.5 million Wisconsin homeowners will see a 38 percent increase in the state’s Lottery and Gaming Credit on their property tax bills this year. The state will distribute a record-high $343.6 million in proceeds from the Wisconsin Lottery in the form of credits for property taxes levied in 2021. Since 1988, the Wisconsin Lottery has provided more than $4.8 billion in property tax relief. The credit for homeowners is based on their local school district tax rate.