The Wisconsin Supreme Court today held unanimously that Catholic Charities qualifies for a religious tax exemption under state law. The court issued a brief, unsigned order, determining that Catholic Charities “is eligible for the religious purposes exemption.” In doing so, the court rejected the state’s attempt to skirt around a unanimous June 2025 ruling by the U.S. Supreme Court that upheld Catholic Charities’ religious exemption from the state’s unemployment tax. Rather than complying with that ruling and giving Catholic Charities the exemption, the state asked the Wisconsin Supreme Court to eliminate the exemption entirely. The Center had filed an amicus brief with the Wisconsin Supreme Court in support of Catholic Charities receiving the exemption. The Wisconsin Supreme Court issued an order remanding the case to the trial court with instructions to (1) vacate the Wisconsin Labor & Industry Review Commission’s (LIRC) decision that Catholic Charities was not eligible for the religious purposes exemption and (2) remand the case to the Wisconsin LIRC with instructions to declare Catholic Charities and its sub-entities eligible for the religious purposes exemption. It should be noted that the court’s order is devoid of any reasoning or analysis; it also offers neither a new test or standard to be applied in future cases nor guidance to the LIRC on how it should address the future application of the religious purposes exemption. It remains to be seen whether the Wisconsin Supreme Court is following the decision of the U.S. Supreme Court or attempting to limit the Court’s opinion to this case and preserve the state’s ability to think up a new way to deny the exemption down the road.
