WI SB896

Creates a $400 per employee income and franchise tax credit for small businesses (fewer than 50 employees) that offer individual coverage health reimbursement arrangements (ICHRAs) to their employees

Requires employers to contribute at least $400 per covered employee to the ICHRA during the taxable year to qualify for the credit

ICHRAs must comply with federal regulations requiring covered employees and dependents to be enrolled in individual health insurance or Medicare, with employees given the option to opt out

Applies to taxable years beginning after December 31, 2025

Pass-through entities (partnerships, LLCs, tax-option corporations) cannot claim the credit directly but must calculate and distribute credit amounts to partners, members, or shareholders based on ownership interests