Tax Credits

Woody Biomass Harvesting & Processing Investment Credit

The Wisconsin Woody Biomass Harvesting and Processing Investment Credit is a refundable tax credit for businesses who have invested to modernize or expand Woody Biomass Harvesting and Processing Operations in Wisconsin.

Woody biomass means ”trees and woody plants, including limbs, tops, needles, leaves, and other woody parts, grown in a forest or woodland or on agricultural land.”

Tax credits are earned by incurring eligible expenses for Woody Biomass Harvesting and Processing equipment used primarily for Woody Biomass Harvesting and Processing that is used as fuel or as a component of fuel; and if acquired and placed in service in Wisconsin during taxable years that end after June 30, 2011, and before January 1, 2016. "Used primarily" means used to the exclusion of all other uses except for use not exceeding 25 percent of total use. 

Eligible expenses include:

  • Building construction, including woody biomass intake, handling, storage and warehouse facilities
  • Building additions
  • Upgrades to utilities, including water, electric, heat, refrigeration, freezing and waste facilities
  • Installing energy-saving equipment or equipment that converts waste to energy
  • Woody Biomass raw material intake, handling  and storage equipment
  • Processing and manufacturing equipment, including mills, pelleting equipment, rollers and dies, boilers, pipes, motors, blowers, pumps and valves
  • Packaging and handling equipment, including cleaning, sealing, bagging, boxing, labeling, conveying and product movement equipment
  • Warehouse equipment, including storage bins and loading and unloading equipment
  • Waste treatment and waste management equipment including tanks, blowers, separators, dryers, digesters and equipment to produce energy, fuel or industrial products
  • Computer software and hardware used for managing the claimant's Woody Biomass Harvesting and Processing operation, including software and hardware related to logistics, inventory management, production plant controls and temperature monitoring controls.

Non-commercial entities are not eligible for the Woody Biomass Harvesting and Processing Investment Credit. Retail establishments, including restaurants and lumber yards, are also not eligible.

A claimant of the credits may be an individual or corporation1[1] and may include either the operator of a Woody Biomass Harvesting and Processing operation, or an owner of a building or facility in which the operation occurs.

Businesses must submit an application form listing the eligible expenses for the taxable year. Each application must be completed and delivered to the Department after the end of the applicant's taxable year in which the eligible capital investments occurred, and no later than February 15 of the subsequent taxable year.

If credits are approved by the Department, a claimant must use Department of Revenue Schedule WB to claim them. The form is available at the Wisconsin Department of Revenue website.

Businesses can earn up to 10% of the eligible expenses spent in the taxable year for modernizing and expanding Woody Biomass Harvesting and Processing Operations. The maximum amount a claimant can receive over the life of the program is $100,000. The Department has $900,000 for each fiscal year.  The Department shall allocate $450,000 in tax credits to businesses that individually, have no more than $5,000,000 in gross receipts from doing business in Wisconsin for the taxable year in which the credit is claimed. The Department may prorate some or all of the allocations in order to broaden the potential for promoting economic development.

For more information on the program and eligibility requirements, contact Mike Bandli of DATCP at 608-224-5136 or mike.bandli@wisconsin.gov .

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[1] Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection; however, the eligibility for, and the amount of, the credit are based on their eligible capital investment.  To effect the value of tax credits for its constituency, a partnership, limited liability company or a tax-option corporation must compute the amount of credit that each of its partners, members, or shareholders may claim based upon the eligible capital investment made by the entity and shall provide that information to each of them.  Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their ownership interest.