Tax Credits & Incentives

• Federal Brownfields Income Tax Deduction
• Tax Incremental Financing (TIF)
• Environmental Remediation Tax Incremental Financing (ERTIF)
• Tools for Managing Delinquent Taxes (75.105, 75.106, & 75.17 Wis. Stats.)
• New Market Tax Credits
• Historic Preservation Tax Credits

Federal Brownfields Income Tax Deduction

The Federal Brownfields Income Tax Deduction allows a taxpayer to deduct qualified environmental remediation expenditures at a property held for use in a trade or business or for the production of income. The taxpayer takes the deductions from federal income in the year that the expenditures were paid or incurred, rather than depreciating them over several years.

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Tax Incremental Financing (TIF) - Department of Revenue

Tax Incremental Financing (TIF) [exit DNR] is a tool for local governments to increase their property tax base, address blighted areas and promote development, redevelopment and job creation. After creating a TIF district (sometimes referred to as “TIDs”), the municipality may borrow to fund infrastructure improvements and land acquisition within the TIF district. The base (original) value of property in the TIF district continues to fund county, school and municipal needs. Revenues generated by the increase in property values in the TIF district are applied toward development expenses and debt service on the loan during the TIF period, up to 27 years, depending on type of TID.

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Environmental Remediation Tax Incremental Financing (ERTIF) - Department of Revenue

Environmental Remediation Tax Incremental Financing (ERTIF) [exit DNR] differs from other tax incremental financing districts in several ways. They are created specifically to address brownfields, and environmental expenses may be recovered through the increase in property values. Also, ERTIFs are not included in the 12 percent limit on a local governmental unit’s (LGU) equalized value, and unlike other TIFs, the base value of an ERTIF may be $0. In addition to cities and villages, counties and towns may establish an ERTIF.

ERTIFs may fund:

• planning;
• property acquisition;
• Phase I and Phase II environmental site assessments;
• environmental investigation;
• removal of underground storage tanks and abandoned containers;
• environmental cleanup; and
• demolition, including asbestos abatement.

There is no limit on the value accrued in the ERTIF, as long as the costs incurred are eligible. The DNR must approve the site investigation report and the remedial action plan before the Department of Revenue (DOR) certifies the base value of the property in the ERTIF. The local government can incur some eligible expenses before the DOR certifies the base value and those costs can be paid back by the ERTIF.

• List of ERTIFs [PDF] - updated 6/11

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Tools for Managing Delinquent Taxes (75.105, 75.106, & 75.17 Wis. Stats.)

There are several state tools local governments can use to manage delinquent taxes for a contaminated property, including cancelling all or portions of the taxes.

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New Market Tax Credits

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Historic Preservation Tax Credits - Wisconsin Historical Society

Historic Preservation Income Tax Credits [exit DNR] are available on both state and federal income taxes for rehabilitation expenses at qualifying properties. Owners of income-producing historic property are eligible following approval from the National Park Service, based on a recommendation from the Historical Society’s Division of Historic Preservation.

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For more information on this specific page, contact:

Eric Ballas