TT - at least the downloaded version -- still has glitches with WI Retirement Income Subtraction as of 3/1/26. My current thinking is that, in your case, your spouse is NOT eligible for any Subtraction, as the 1099-Rs are not issued to her (the 67+ person). Part of that belief is how TT is asking the questions in Easy Step. I do think the language in the WI publications below is not crystal clear on that though. [I'm similarly under 67 with $40,000+ Retirement Income with over 67 spouse. I'll be holding off on filing WI return for a while until this is fixed in TT or further clarified. Let us know if you find out otherwise!!]
From Form SB instructions: https://www.revenue.wi.gov/TaxForms2025/2025-ScheduleSB-Inst.pdf
Line 16 – Retirement Income Subtraction (Credits Restricted)
If you (or your spouse if married and filing a joint return) were at least 67 years old as of December 31, 2025, you may subtract retirement income from a qualified retirement plan or individual retirement account (IRA) that is federally taxable and has not been removed from Wisconsin income on lines 12 through 15 of this schedule. Individuals may subtract up to $24,000 of retirement income received. A married couple who file a joint return and are both as least 67 years old as of December 31, 2025, may subtract up to $48,000 of retirement income, regardless of how much retirement income each spouse received.
From Pub 106, Tax Information for Seniors: https://www.revenue.wi.gov/DOR%20Publications/pb106.pdf
Retirement Income Subtraction
Wisconsin has two potential subtractions for taxable distributions from qualified retirement plans and individual
retirement accounts.
1) Up to $24,000 ($48,000 for certain joint filers) of qualified retirement income may be subtracted from
Wisconsin income if you (or your spouse if married filing joint return) were age 67 or older on December
31, 2025. Taxpayers claiming this subtraction on their 2025 Wisconsin income tax return may not claim any
Wisconsin income tax credit in computing their refund or balance due for the year.
