Finance Q&A

Do I have to file a Wisconsin tax return ?

Edwards Finance > Income Tax

Q. I am a full-time Illinois resident, and work full-time in Illinois, yet I have a duplex in Kenosha, WI. Am I obligated to file a return for WI for this income, or does the recip agreement between IL and WI eliminate this requirement? Is there anyone in a similar circumstance that can speak from experience?

A. No experience. www.revenue.state.il.us/Individuals/FilingRequirements/index.htm says ========================================================= An Iowa, Kentucky, Michigan, or Wisconsin resident who worked in Illinois, must file Form IL-1040 and Schedule NR if you received income in Illinois from sources other than wages, salaries, tips, and commissions (you must pay tax on this income regardless of residency);or you want a refund of any Illinois Income Tax withheld. If you received compensation from Illinois employers, you are not required to pay Illinois Income Tax on this income. This is based on reciprocal agreements between Illinois and these states and applies only to compensation you received from wages, salaries, tips, and commissions. The reciprocal agreements do not apply to any other income you might have received, such as Illinois lottery winnings. ================================================================== So if you rent that condo, you file. If it is your vacation house, I don't think so. This is a nice list of reciprocal arrangements: http://www.payroll-taxes.com/articles/reciprocals.html -The reciprocal agreement applies only to compensation for services. The rental income is Wisconsin source income subject to Wisconsin tax. You do need to file a Wisconsin nonresident return. Illinois will give you credit for the tax you pay to Wisconsin on that income, limited to the Illinois tax on that income.

 


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