A long-term care insurance assessment and a long-term care insurance assessment tax credit, the official text

2025 - 2026 LEGISLATURE
LRB-5462/1
EKL&KP:cdc

2025 ASSEMBLY BILL 699
November 26, 2025 - Introduced by Representatives Petersen, Doyle, Gundrum, Kreibich, O'Connor, Piwowarczyk and Subeck, cosponsored by Senators Stafsholt and Wall. Referred to Committee on Insurance.

An Act to amend 71.05 (6) (a) 15., 71.10 (4) (i), 71.21 (4) (a), 71.21 (6) (d) 3., 71.26 (2) (a) 4., 71.30 (3) (f), 71.34 (1k) (g), 71.365 (4m) (d) 2., 71.45 (2) (a) 10., 71.49 (1) (f), 76.67 (1), 76.67 (2), 646.11 (2), 646.51 (3) (am), 646.51 (4) (a) and 646.51 (7) (b); to create 20.835 (2) (de), 71.07 (12), 71.10 (4) (co), 71.28 (12), 71.30 (3) (dh), 71.47 (12), 71.49 (1) (dh), 76.633, 646.03 (3m), 646.51 (3) (bm) and 646.51 (7) (bm) of the statutes; relating to: a long-term care insurance assessment and a long-term care insurance assessment tax credit.

Analysis by the Legislative Reference Bureau
Under current law, certain insurers authorized to transact business in Wisconsin are required to contribute to the “insurance security fund.” The insurance security fund is created to maintain public confidence in the promises of insurers by providing a mechanism for protecting insureds from excessive delay and loss in the event of liquidation of insurers and by assessing the cost of such protection among insurers and to provide for the continuation of protection under policies and supplementary contracts of life insurance, health insurance, and annuities. To this end, current law provides conditions and procedures for the insurance security fund to determine whether to issue payment for a claim that arises out of an insurance policy or annuity issued by an insurer against which an order of liquidation has been entered by a court in this state and how much the insurance security fund will issue as payment. Further, current law requires the insurance security fund, after a liquidation order has been issued, to calculate, assess, and collect from insurers, separately for each of the accounts in the fund, the amounts necessary to make payments provided under current law. Current law provides that an insurer may recoup its assessments by increasing premium rates or, if an insurer cannot recoup its assessments by increasing premium rates, by offsetting 20 percent of the assessment against its tax liabilities in this state, other than real property taxes, in each of the five calendar years following the year in which the assessment was paid.
The insurance security fund is currently composed of five segregated accounts: one for life insurance and annuities; one for health insurance policies, referred to under current law as disability insurance policies, other than policies issued or coverage provided by a health maintenance organization insurer; one for health maintenance organization insurers; one for other kinds of insurance described under current law; and one administrative account.
The insurance security fund is administered by a board of directors that consists of the attorney general, the state treasurer, and the commissioner of insurance along with at least nine but not more than 11 insurer representatives of domestic, foreign, and alien insurers subject to state law. The board of directors has certain powers and duties specified under current law, including standing in the position of the insurer, if the insurer is in liquidation, in the investigation, compromise, settlement, denial, and payment of eligible claims and the defense of third-party claims against insureds, subject to certain limitations.
The bill adds a segregated account to the insurance security fund for long-term care insurance. The bill directs the board to calculate the assessments required for the long-term care insurance account by first calculating the percentage of life insurance, annuity contract, and disability insurance premiums written by each life insurer and by each disability insurer to which the insurance security fund applies based on each insurer’s total of all such premiums written in this state for the year preceding the year in which the assessment is authorized. From this calculation, the bill provides that if the percentage of life insurance and annuity contract premiums exceeds 50 percent of the total premiums, then the insurer is classified as a life insurer, and if the percentage of disability insurance premiums exceeds 50 percent of the total premiums, then the insurer is classified as a disability insurer. The bill then directs the board to allocate 50 percent of the total assessment authorized for the long-term care insurance account to life insurers and 50 percent to disability insurers, and each insurer in those classes must pay an assessment based on the percentage of the total premiums written in this state by the insurer relative to all premiums written in this state in that class.
The bill also creates a tax credit against state income and franchise taxes and insurer license fees for long-term care insurance assessments paid by insurers. The credit is equal to 20 percent of the amount of the long-term care insurance assessment paid by the insurer and may be claimed for the tax year following the tax year during which the claimant paid the long-term care insurance assessment and for the following four years. The credit is refundable for disability insurers, but for all other claimants, the credit is nonrefundable. The bill makes no appropriation for making refundable credit payments.
For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

Section 1. 20.005 (3) (schedule) of the statutes: at the appropriate place, insert the following amounts for the purposes indicated:
- See PDF for table
Section 2. 20.835 (2) (de) of the statutes is created to read:
20.835 (2) (de) Long-term care insurance assessment credit. The amounts in the schedule to make the payments under ss. 71.07 (12) (d) 2., 71.28 (12) (d) 2., 71.47 (12) (d) 2., and 76.633 (4).
Section 3. 71.05 (6) (a) 15. of the statutes, as affected by 2025 Wisconsin Act 15, is amended to read:
71.05 (6) (a) 15. The amount of the credits computed under s. 71.07 (2dm), (2dx), (2dy), (3g), (3h), (3n), (3q), (3s), (3t), (3w), (3wm), (3y), (4k), (4n), (5f), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), and (10), and (12) and not passed through by a partnership, limited liability company, or tax-option corporation that has added
that amount to the partnership’s, company’s, or tax-option corporation’s income under s. 71.21 (4) or 71.34 (1k) (g).
Section 4. 71.07 (12) of the statutes is created to read:
71.07 (12) Long-term care insurance assessment credit. (a) Definitions. In this subsection:
1. “Claimant” means a person who files a claim under this subsection.
2. “Disability insurer” means an insurer classified as a disability insurer under s. 646.51 (3) (bm) 2.
(b) Filing claims. Subject to the limitations provided under this subsection, for taxable years beginning after December 31, 2026, a claimant may claim as a credit against the taxes imposed under s. 71.02, for the taxable year following the taxable year that a claimant pays an assessment under s. 646.51 (3) (bm), and for the immediately following 4 taxable years, an amount equal to 20 percent of the assessment under s. 646.51 (3) (bm) paid by the claimant.
(c) Limitations. 1. A partnership, limited liability company, or tax-option corporation, including a partnership, limited liability company, or tax-option corporation that makes an election under s. 71.21 (6) (a) or 71.365 (4m) (a) to be taxed at the entity level, may claim the credit under par. (b).
2. A partnership’s partners, limited liability company’s members, and tax- option corporation’s shareholders may not claim the credit under par. (b).
(d) Administration. 1. Section 71.28 (4) (e), (g), and (h), as it applies to the credit under s. 71.28 (4), applies to the credit under this subsection.
2. If the claimant is a disability insurer and if the allowable amount of the claim under par. (b) exceeds the tax otherwise due under s. 71.02 or 71.21 (6) (a),
the amount of the claim not used to offset the tax due shall be certified by the department of revenue to the department of administration for payment to the claimant by check, share draft, or other draft drawn from the appropriation account under s. 20.835 (2) (de). Notwithstanding s. 71.82 (1) (b), no interest shall be added to amounts certified under this subdivision.
Section 5. 71.10 (4) (co) of the statutes is created to read:
71.10 (4) (co) Long-term care insurance assessment credit under s. 71.07 (12), except as provided under par. (i).
Section 6. 71.10 (4) (i) of the statutes, as affected by 2025 Wisconsin Act 15, is amended to read:
71.10 (4) (i) The total of claim of right credit under s. 71.07 (1), farmland preservation credit under ss. 71.57 to 71.61, farmland preservation credit, 2010 and beyond under s. 71.613, homestead credit under subch. VIII, jobs tax credit under s. 71.07 (3q), business development credit under s. 71.07 (3y), research credit under s. 71.07 (4k) (e) 2. a., film production services credit under s. 71.07 (5f) (b) 2., veterans and surviving spouses property tax credit under s. 71.07 (6e), enterprise zone jobs credit under s. 71.07 (3w), electronics and information technology manufacturing zone credit under s. 71.07 (3wm), long-term care insurance assessment credit under s. 71.07 (12) (d) 2., earned income tax credit under s. 71.07 (9e), estimated tax payments under s. 71.09, and taxes withheld under subch. X.
Section 7. 71.21 (4) (a) of the statutes, as affected by 2025 Wisconsin Act 15, is amended to read:
71.21 (4) (a) The amount of the credits computed by a partnership under s. 71.07 (2dm), (2dx), (2dy), (3g), (3h), (3n), (3q), (3s), (3t), (3w), (3wm), (3y), (4k), (4n),
(5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), and (10), and (12) and passed through to partners shall be added to the partnership’s income.
Section 8. 71.21 (6) (d) 3. of the statutes is amended to read:
71.21 (6) (d) 3. Except as provided in s. ss. 71.07 (7) (b) 3. and (12) (c) 2., 71.28 (12) (c) 2., and 71.47 (12) (c) 2., the tax credits under this chapter may not be claimed by the partnership.
Section 9. 71.26 (2) (a) 4. of the statutes, as affected by 2025 Wisconsin Act 15, is amended to read:
71.26 (2) (a) 4. Plus the amount of the credit computed under s. 71.28 (1dm), (1dx), (1dy), (3g), (3h), (3n), (3q), (3t), (3w), (3wm), (3y), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), and (10), and (12) and not passed through by a partnership, limited liability company, or tax-option corporation that has added that amount to the partnership’s, limited liability company’s, or tax-option corporation’s income under s. 71.21 (4) or 71.34 (1k) (g).
Section 10. 71.28 (12) of the statutes is created to read:
71.28 (12) Long-term care insurance assessment credit. (a) Definitions. In this subsection:
1. “Claimant” means a person who files a claim under this subsection.
2. “Disability insurer” means an insurer classified as a disability insurer under s. 646.51 (3) (bm) 2.
(b) Filing claims. Subject to the limitations provided under this subsection, for taxable years beginning after December 31, 2026, a claimant may claim as a credit against the taxes imposed under s. 71.23, for the taxable year following the taxable year that a claimant pays an assessment under s. 646.51 (3) (bm), and for
the immediately following 4 taxable years, an amount equal to 20 percent of the assessment under s. 646.51 (3) (bm) paid by the claimant.
(c) Limitations. 1. A partnership, limited liability company, or tax-option corporation, including a partnership, limited liability company, or tax-option corporation that makes an election under s. 71.21 (6) (a) or 71.365 (4m) (a) to be taxed at the entity level, may claim the credit under par. (b).
2. A partnership’s partners, limited liability company’s members, and tax- option corporation’s shareholders may not claim the credit under par. (b).
(d) Administration. 1. Subsection (4) (e), (g), and (h), as it applies to the credit under sub. (4), applies to the credit under this subsection.
2. If the claimant is a disability insurer and if the allowable amount of the claim under par. (b) exceeds the tax otherwise due under s. 71.23 or 71.365 (4m) (a), the amount of the claim not used to offset the tax due shall be certified by the department of revenue to the department of administration for payment to the claimant by check, share draft, or other draft drawn from the appropriation account under s. 20.835 (2) (de). Notwithstanding s. 71.82 (1) (b), no interest shall be added to amounts certified under this subdivision.
Section 11. 71.30 (3) (dh) of the statutes is created to read:
71.30 (3) (dh) Long-term care insurance assessment credit under s. 71.28 (12), except as provided under par. (f).
Section 12. 71.30 (3) (f) of the statutes, as affected by 2025 Wisconsin Act 15, is amended to read:
71.30 (3) (f) The total of farmland preservation credit under subch. IX, jobs credit under s. 71.28 (3q), enterprise zone jobs credit under s. 71.28 (3w), electronics
and information technology manufacturing zone credit under s. 71.28 (3wm), long- term care insurance assessment credit under s. 71.28 (12) (d) 2., business development credit under s. 71.28 (3y), research credit under s. 71.28 (4) (k) 1., film production services credit under s. 71.28 (5f) (b) 2., and estimated tax payments under s. 71.29.
Section 13. 71.34 (1k) (g) of the statutes, as affected by 2025 Wisconsin Act 15, is amended to read:
71.34 (1k) (g) An addition shall be made for credits computed by a tax-option corporation under s. 71.28 (1dm), (1dx), (1dy), (3), (3g), (3h), (3n), (3q), (3t), (3w), (3wm), (3y), (4), (5), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), and (10), and (12) and passed through to shareholders.
Section 14. 71.365 (4m) (d) 2. of the statutes is amended to read: