A lawmaker warns Wisconsin will be put further into a business-unfriendly position if the legislature doesn’t adopt new federal tax guidelines.
State Senator Glenn Grothman (R-West Bend) is introducing legislation to change Wisconsin’s IRA and 401K limits to conform to federal law next year.
“Wisconsin is in danger of being the only state in the country in which you could not give $16,500 to your 401k or $5,000 to your IRA next year.”
The West Bend Republican says in 2010 Wisconsin will end up reverting to the old limits from 2001, limiting taxpayers to take a $2,000 IRA deduction and a $7,500 401k reduction.
“Why would we want to make Wisconsin the only state in the country in which you are penalized for doing so? This is the problem we have in Wisconsin. Your more successful people keep leaving and the type of people who go on welfare keep coming in.”
Grothman warns, the State of Wisconsin will impose a penalty on additional contributions that folks in all other states would be able to enjoy.
“I would call on every accountant and financial adviser to educate their state legislators as to what a calamity will result unless they wake up like the other 49 states already have.”
Assembly Democrats agree that this is an issue, saying they have already asked the Legislative Fiscal Bureau to review the fiscal impact on adopting the new federal guidelines for 2010.
The state Revenue Department statement.