Tax Managers Brace for Busy Season in Wisconsin

MADISON, Wis. – As new federal and state tax modifications roll out, local accountants are gearing up for what one described as a “crazy tax season.”

These updates were enacted under President Donald Trump’s recently signed “Big Beautiful Bill,” finalized in July.

Scott Schweiger, who is with Nite Owl CPAs in Madison, noted that taxpayers should start organizing their documents, as several fresh deductions will be available this tax year.

A significant change this year is the removal of taxes on reported tips. Schweiger explained that if a server receives a cash tip and it isn’t reported, a deduction could still be claimed. “It’s important to check Box 7 on your W-2— that’s the amount being reported and what you’ll include on your return,” he said.

Deductions also apply to overtime pay, but only on the excess half. Schweiger clarified that, “If your year-end pay slip shows you worked a total of ‘x’ overtime hours, only a third of that is counted.”

As of now, the IRS lacks a standard method for tracking overtime hours. Therefore, he suggests maintaining thorough records. “If you’re ever questioned, having that documentation at your fingertips can help,” he advised, adding that authorities often allow for reasonable explanations.

In Wisconsin, there are exemptions for residents over 65, which includes $6,000, while those over 67 can enjoy up to $24,000 of retirement income tax-free.

Families can also establish a “Trump Account” for children born in 2025. This account starts with a $1,000 contribution from the government, allowing for tax-free investment growth for 18 years. Form 4547 must be filled out to set up the account.