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On April 9, 2026, Gov. Tony Evers signed 2025 Wisconsin Act 238 into law, modifying the Wisconsin State Historic Tax Credit Program. This Act makes significant changes to the state program which, in turn, is intended to make state historic tax credit transactions more accessible.
Overview of the Historic Preservation Tax Credit Program
A tax credit is a dollar-for-dollar reduction in tax owed. A credit is more valuable than a deduction, as a deduction is a reduction in income subject to taxation, not a reduction in actual tax owed. The federal Historic Tax Credit Program originally dates to 1976.
Under the current program, applicants can receive a tax credit against federal income tax liability equal to 20 percent of qualified rehabilitation expenditures. To be eligible, the project must be on or eligible for the National Register of Historic Places, be a taxable property, be income-producing, and have minimum project expenditure of the greater of (a) $5,000 or (b) the adjusted basis in the project.
The Wisconsin State Historic Tax Credit Program originally dates to 1989. At its inception, it offered a 5 percent tax credit against state income tax liability to complement the federal program, but this was increased to 20 percent in 2014. Unlike the federal credit, the state credit is certificated. Among other attributes, the certification allows non-profits to deploy the credit by transferring the certificated credit to an investor. Further, unlike the federal program, the minimum project expenditure was (a) $50,000 and (b) the adjusted basis in the project. It also had a $3.5 million maximum credit for the life of any particular project.
2025 Wisconsin Act 238
2025 Wisconsin Act 238 made significant changes to the Wisconsin State Historic Tax Credit Program. First, it amends the minimum expenditure. As noted above, prior to this Act, projects must have expended at least $50,000 and the adjusted basis in the project. Now, projects can qualify for the credit with only a minimum of $50,000 expended; there is no need for the adjusted basis test. Second, while the Act left the $3.5 million cap on credits per project unchanged, it allowed projects to reapply for subsequent credits after 15 years.
Impacts
Prior to the Act, many smaller projects could not receive state credits because the minimum expenditure was too high given the adjusted basis test. These projects would need to spend at least $50,000 and the adjusted basis in the project. Now, the minimum expenditure is only $50,000. Thus, many smaller projects will be eligible, assuming they will spend at least $50,000 on rehabilitation, regardless of the adjusted basis in the project. This loosening of requirements will provide much needed financing to smaller projects, particularly projects in rural areas.
Further, prior to the Act, projects that previously received awards were ineligible for later awards. As a result, historic projects that needed subsequent repairs were unable to use credits to finance these repairs. Now, projects will be eligible for later awards after 15 years. This incentivizes long-term investment in historic projects by providing a source of financing 15 years after the initial investment.
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