Updated October 19, 2026. Quick answer: Wisconsin Schedule SB is the schedule where retirement income that Wisconsin does not tax is subtracted from federal income. Lines 12 to 15 cover military, local and state, federal and railroad retirement benefits, and lines 16 and 17 hold two age-based retirement income subtractions. The schedule’s total carries to Form 1, filed with your Wisconsin return.
What this form does
The instructions open with “Schedule SB is used to report differences between federal and Wisconsin income.” They add that these differences “may affect the amount you report as a subtraction modification on line 6 of Form 1.” The form’s own header reads “File with Wisconsin Form 1”.
For retirees the relevant part is lines 12 to 17. Wisconsin retirement taxes covers the state picture; this page follows the schedule itself.
Who it applies to
Each retirement line has its own conditions. For lines 13 and 14 the instructions list three, the first being “You were retired from the system before January 1, 1964”, the second “You were a member of the system as of December 31, 1963, retiring at a later date and payments you receive are from an account established before 1964”, and the third “You are receiving payments from the system as the beneficiary of an individual who met either condition 1 or 2”.
Line 16 opens with “If you (or your spouse if married and filing a joint return) were at least 67 years old as of December 31, 2025”. Line 17 requires that “You (or your spouse if married filing a joint return) were 65 years of age or older on December 31, 2025, and” that “Your federal adjusted gross income (line 3 of Form 1) is less than $15,000 ($30,000 if married filing a joint return).”
The lines, one by one
| Line | What the form says |
|---|---|
| Line 12 | “Military and uniformed services retirement benefits”. Instructions: “Your subtraction cannot be more than the amount of such retirement payments that you included in your federal income.” |
| Line 13 | “Local and state retirement benefits”. Instructions: “You may subtract any payments received from the retirement systems listed below provided you meet one of the following requirements:” |
| Line 14 | “Federal retirement benefits”. Instructions: “You may subtract payments received from the U.S. Civil Service Retirement System provided you meet one of the following” requirements, and “Payments from the federal Thrift Savings Plan do not qualify for the subtraction.” |
| Line 15 | “Railroad retirement benefits, railroad unemployment insurance, and sickness benefits”. Instructions: “Wisconsin does not tax amounts received from the U.S. Railroad Retirement Board.” |
| Line 16 | “Retirement income subtraction (credits restricted)”. Instructions: “you may subtract retirement income from a qualified retirement plan or individual retirement account (IRA) that is federally taxable” |
| Line 17 | “retirement income subtraction (income restricted)”. Instructions: “You may subtract up to $5,000 of certain retirement income if:” |
| Worksheet line 1 | “Taxable IRA distributions from line 4b of your federal Form 1040 or 1040-SR” |
| Worksheet line 2 | “Taxable pension and annuity income from a qualified retirement plan included on line 5b of federal Form 1040 or 1040-SR” |
| Worksheet line 4 | “Nontaxable retirement benefits (This is the total amount subtracted on lines 12, 13, 14, 15, and 16)” |
| Worksheet line 6 | “This is your subtraction for retirement income.” |
The instructions after line 13 carry a warning that line 14 shares: “Your retirement benefits may be subtracted only if they are based on qualified membership in one of the specified retirement systems.” For line 16 the instructions add a caution about credits: “if you claim this subtraction, you may not claim any tax credit on Schedule CR”.
The figures the form prints
Each figure here sits inside one running sentence. Line 16 says “Individuals may subtract up to $24,000 of retirement income received.” and “may subtract up to $48,000 of retirement income, regardless of how much retirement income each spouse received.” Line 17 says “You may subtract up to $5,000 of certain retirement income if:” and the worksheet’s line 6 uses “the smaller of line 5, Col. (A), or $5,000.”
Line 17 sends you to the Retirement Income Subtraction Worksheet in the instructions, which is not reproduced in full here.
Where the result goes next
The schedule’s final line says “This is your total subtraction from income. Enter on Form 1, line 6”. Your payers’ figures come from Form 1099-R; see 1099-R boxes explained, Form 1040 line 5a and 5b and Form 1040 line 4a and 4b for how the federal return reports the same payments. For the broader questions of how the state treats Wisconsin 401(k) and IRA withdrawals and Wisconsin annuity income, see those pages.
A worked example
The worksheet under line 17 prints its own arithmetic: line 3 adds lines 1 and 2, line 5 subtracts line 4 from line 3, and line 6 is the smaller of line 5 or $5,000. This is an illustration, not a state example, using invented amounts for a single filer who meets the line 17 conditions and claimed nothing on lines 12 to 16.
Suppose line 1 is $3,000 and line 2 is $4,000. Line 3 is $3,000 plus $4,000 which is $7,000 (computed). Line 4 is $0 and line 5 is $7,000 minus $0 which is $7,000 (computed). Line 6 is the smaller of $7,000 or $5,000 which is $5,000.
The amounts are invented for the computation; your own lines depend on your own Forms 1099-R.
Edition and line numbers
This page reads the 2025 Schedule SB Instructions (I-0104, Rev. 10-25) and the 2025 Schedule SB (I-0103, Rev. 08-25) for tax year 2025, the current file Wisconsin Department of Revenue served on 2026-10-19. Check the edition printed on your own form and use that edition’s line numbers.
Common mistakes
- Subtracting federal Thrift Savings Plan payments on line 14. The instructions say “Payments from the federal Thrift Savings Plan do not qualify for the subtraction.”
- Claiming line 16 and still taking credits. The instructions caution “if you claim this subtraction, you may not claim any tax credit on Schedule CR”
- Subtracting more than was taxed federally on lines 12 to 14. The instructions say “Your subtraction cannot be more than the amount of such payments that you included in your federal income.”
Related: Wisconsin retirement taxes, whether Wisconsin taxes pensions, Wisconsin 401(k) and IRA withdrawals, Form 1040 line 5a and 5b, and 1099-R boxes explained.
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Answer againSources
- 2025 Schedule SB Instructions (I-0104, Rev. 10-25), Wisconsin Department of Revenue: www.revenue.wi.gov
- 2025 Schedule SB, Other Subtractions from Income (I-0103, Rev. 08-25), Wisconsin Department of Revenue: www.revenue.wi.gov
Read from the state revenue documents linked above on October 19, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the state revenue department is the right place to confirm anything consequential.