Tax 2.955(1)(1)
Definition. In this section, "state" means the 50 states of the United States and the District of Columbia, but does not include the commonwealth of Puerto Rico or the several territories organized by Congress.
Tax 2.955(2)(a)(a) Except as provided in
sub. (3), an income tax credit may be claimed by a Wisconsin resident individual, estate, or trust for any net minimum tax or income tax paid to another state upon income of the individual, estate or trust taxable by that state.
Tax 2.955(2)(b)
(b) Except as provided in
sub. (3), an income tax credit may be claimed by a Wisconsin resident shareholder in a tax-option (S) corporation for any net minimum tax, income tax, or franchise tax paid by that shareholder to another state on or measured by income of the tax-option (S) corporation.
Tax 2.955(3)
(3) Credits not allowed. An income tax credit may not be allowed for:
Tax 2.955(3)(a)
(a) Income tax paid to Illinois, Indiana, Kentucky, Michigan or Minnesota on personal service income earned in these states included under a reciprocity agreement.
Tax 2.955 Note
Note: Refer to s.
Tax 2.02 for information concerning reciprocity.
Tax 2.955(3)(b)
(b) Minimum tax or income tax paid to another state on income considered neither taxable income for Wisconsin tax purposes nor a tax preference item in the computation of the Wisconsin minimum tax.
Tax 2.955(3)(c)
(c) Minimum tax paid to a state which does not classify the minimum tax as an income tax.
Tax 2.955(3)(d)
(d) Income tax paid to a county, city, village, town or foreign country.
Tax 2.955(4)
(4) How to claim a credit. The amount of income tax credit claimed shall be entered on the line provided for net income tax paid to other states on Wisconsin income tax return form 1 or form 1NPR. The credit may not exceed the Wisconsin net tax. To support the credit claimed, the following information shall be attached to form 1 or form 1NPR:
Tax 2.955(4)(a)
(a) For a Wisconsin resident individual, estate, or trust, attach copies of the other state's income tax return and the wage statements, if any, to the Wisconsin income tax return.
Tax 2.955(4)(b)
(b) For a Wisconsin resident shareholder in a tax-option (S) corporation, the federal subchapter S status of which is recognized by the other state:
Tax 2.955(4)(b)1.
1. If a Wisconsin resident shareholder files an individual income tax return with that state, attach a copy of the other state's income tax return to the Wisconsin income tax return.
Tax 2.955(4)(b)2.
2. If the corporation files a combined or composite return with that state on behalf of its shareholders who are nonresidents of that state and pays the tax on their proportionate share of the income earned there, attach to the Wisconsin income tax return either a copy of the Wisconsin schedule 5K-1 on which is shown the shareholder's share of tax paid to that state, or a letter as provided in
par. (d).
Tax 2.955(4)(b)3.
3. If the corporation files a corporate income or franchise tax return with that state and pays tax on or measured by income earned there that is attributable to its shareholders who are nonresidents of that state, attach to the Wisconsin income tax return either a copy of the Wisconsin schedule 5K-1 on which is shown the shareholder's share of tax paid to that state, or a letter as provided in
par. (d).
Tax 2.955(4)(c)
(c) For a Wisconsin resident shareholder in a tax-option (S) corporation, the federal subchapter S status of which is not recognized by the other state, if the corporation pays an income or franchise tax on or measured by the income earned there, attach to the Wisconsin income tax return either a copy of the Wisconsin schedule 5K-1 on which is shown the shareholder's share of tax paid to that state, or a letter as provided in
par. (d).
Tax 2.955(4)(d)
(d) If the tax-option (S) corporation is not subject to Wisconsin's income or franchise tax, a Wisconsin resident shareholder shall attach to the Wisconsin income tax return a letter provided by the corporation in lieu of Wisconsin schedule 5K-1 as required in
pars. (b) 2. and
3. and
(c). The letter shall include a schedule showing the shareholder's proportionate share of the items of income taxable by that state, the adjusted gross income, and the net tax paid.
Tax 2.955(5)
(5) Year in which to claim income tax credit. The credit for income tax paid to another state shall be claimed on the Wisconsin return for the year in which the out-of-state income is considered taxable Wisconsin income.
Tax 2.955 Note
Example: A Wisconsin resident receives income of $4,000 in 1992 from rental property located in Iowa. The person files a 1992 declaration of estimated tax of $200 with Iowa, with $150 of estimated tax payments being made in 1992 and the fourth quarter payment of $50 being made in January 1993. The Iowa income of $4,000 is reported as income on the 1992 Iowa and Wisconsin returns. The 1992 Iowa income tax return shows the following:
Tax 2.955 Note
1992 Iowa Return
Tax 2.955 Note
Iowa Rental Income $4,000
Tax 2.955 Note
Iowa Net Tax $ 185
Tax 2.955 Note
Estimated Tax Payments 200
Tax 2.955 Note
Refund $ 15
Tax 2.955 Note
The taxpayer may claim a credit for net income tax paid to other states of $185 on the 1992 Wisconsin return, even though a part of the tax was paid in 1993.
Tax 2.955 History
History: Cr.
Register, December, 1978, No. 276, eff. 1-1-79; am. (4) (b),
Register, January, 1981, No. 301, eff. 2-1-81; r. (2) (a) and (b), (3) (b), am. (2) (c), (3) (d) and (4), renum. (3) (c) to be (3) (b), r. and recr. (5),
Register, September, 1983, No. 333, eff. 10-1-83; am. (1), (2), (3) (a) and (b), (4) (intro.), renum. (3) (cv) to be (3) (d), cr. (2) (b), (3) (c), (4) (c) and (d), r. and recr. (4) (a) and (b),
Register, June, 1990, No. 414, eff. 7-1-90; am. (3) (intro.), (a), (4) (b) 2., 3., (c) and (d),
Register, April, 1993, No. 448, eff. 5-1-93.
Tax 2.956
Tax 2.956
Historic structure and rehabilitation of nondepreciable historic property credits. Tax 2.956(1)
(1)
Purpose. This section clarifies the phrase "first applies . . . for projects begun after December 31, 1988" as used in the initial applicability of s.
71.07 (9m) and
(9r), Stats., as created by
1987 Wis. Acts 395 and
399, respectively. The initial applicability is provided in section 71 of Act 395 and in section 3203 (47) (mp) of Act 399.
Tax 2.956(2)
(2) Definition of "begun". In the initial applicability of s.
71.07 (9m) and
(9r), Stats., the date a project is "begun" means the date on which the physical work of rehabilitation commences. The physical work of rehabilitation commences when actual construction, or destruction in preparation for construction, commences. The term "physical work of rehabilitation," however, does not include preliminary activities such as planning, designing, securing financing, exploring, researching, developing plans and specifications, or stabilizing a building to prevent deterioration, such as placing boards over broken windows.
Tax 2.956 History
History: Emerg. cr. 12-28-88; cr.
Register, June, 1989, No. 402, eff. 7-26-89; corrections in (1) and (2) made under s. 13.93 (2m) (b) 7., Stats.,
Register October 2002 No. 562.
Tax 2.957
Tax 2.957
Relocated business credit or deduction. Tax 2.957(1)(1)
Purpose. The purpose of this section is to prescribe the method by which the percentage of the workforce payroll of a business and the dollar amount of wages paid to such workforce moved to this state during a taxable year shall be determined for purposes of ss.
71.05 (6) (b) 47.,
71.28 (9s), and
71.47 (9s), Stats.; provide examples of actions that may indicate a business has relocated to this state from another state or country; and limit the deduction provided for in s.
71.05 (6) (b) 47. am.,
b., and
c., Stats.
Tax 2.957(2)(a)
(a) "Business" means any organization or enterprise operated for profit, including a sole proprietorship, partnership, firm, business trust, joint venture, syndicate, corporation, limited liability company, or association.
Tax 2.957(2)(c)
(c) "Employee" has the meaning given in section
3121 (d) of the Internal Revenue Code.
Tax 2.957(2)(e)
(e) "Wages" has the meaning given in section
3121 (a) of the Internal Revenue Code.
Tax 2.957(3)(b)
(b) Registering to do business in Wisconsin with the department of financial institutions.
Tax 2.957(5)
(5) Workforce payroll. For purposes of ss.
71.05 (6) (b) 47. a.,
71.28 (9s) (a) 2., and
71.47 (9s) (a) 2., Stats., the determination as to whether 51% or more of the workforce payroll of a business has moved to this state during a taxable year shall be made using a fraction, the numerator of which is the total amount of wages paid by the business during the taxable year to employees of the business who are residents of this state, and the denominator of which is the total amount of wages paid by the business during the taxable year to all employees of the business.
Tax 2.957 Note
Example: During the taxable year in which Business A begins doing business in Wisconsin, Business A pays $6,000,000 of wages to employees of Business A who are residents of Wisconsin and $10,000,000 of total wages to all employees of Business A. Sixty (60) percent of the workforce payroll of Business A moved to Wisconsin during the taxable year (6,000,000/10,000,000).
Tax 2.957(6)
(6) Workforce wages. For purposes of ss.
71.05 (6) (b) 47. a.,
71.28 (9s) (a) 2., and
71.47 (9s) (a) 2., Stats., the determination as to whether at least $200,000 of wages paid to the workforce of a business has moved to this state during a taxable year shall be made using the total amount of wages paid by the business during the taxable year to employees of the business who are residents of this state.
Tax 2.957 Note
Example: During the taxable year in which Business B begins doing business in Wisconsin, Business B pays $250,000 of wages to employees of Business B who are residents of Wisconsin. Wages of $250,000 paid to the workforce of Business B moved to Wisconsin during the taxable year.
Tax 2.957(7)
(7) Limitation on deduction. No modification may be made under s.
71.05 (6) (b) 47. am.,
b., or
c., Stats., if the amount otherwise eligible for the modification is less than zero.
Tax 2.957 Note
Example: Partner B determines the amount otherwise eligible for the modification under s.
71.05 (6) (b) 47. b., Stats., is a loss of $5,000. Partner B may not make a modification under s.
71.05 (6) (b) 47. b., Stats.
Tax 2.957 History
History: EmR1104: emerg. cr. eff. 4-7-11;
CR 11-023: cr.
Register November 2011 No. 671, eff. 12-1-11.
Tax 2.96
Tax 2.96
Extensions of time to file corporation franchise or income tax returns. Tax 2.96(1)(a)(a) General. Except as provided in
pars. (am) and
(b), corporation franchise or income tax returns are due on or before the 15th day of the 3rd month following the close of a corporation's taxable year unless an extension of time for filing has been granted.
Tax 2.96(1)(am)
(am) For tax exempt corporations with unrelated business taxable income, the franchise or income tax return is due on or before the 15th day of the 5th month following the close of the corporation's taxable year unless an extension of time for filing has been granted.
Tax 2.96(1)(b)
(b) Short-period returns. Corporation franchise or income tax returns for periods of less than 12 months are due on or before the federal due date.
Tax 2.96(2)(a)(a)
Automatic extension. For corporation franchise or income tax returns, an automatic extension is allowed for a period of 7 months or until the original due date of the corporation's corresponding federal return, whichever is later. If any extension is obtained for federal purposes, that extension also applies for Wisconsin purposes and is further extended for another 30 days after the federal due date. A copy of federal extension form 7004, or other federal extension form, if applicable, shall be attached to any Wisconsin franchise or income tax return filed under extension, even if the extension was not requested for federal purposes.
Tax 2.96(2)(b)
(b) Combined returns. For corporations required to use combined reporting under s.
71.255, Stats., any extension granted to the designated agent of the combined group is considered granted to each corporation in the combined group.
Tax 2.96(2)(c)
(c) Estimated tax payment. A taxpayer who desires to minimize interest charges during the extension period may pay the estimated tax liability on or before the original due date of the franchise or income tax return. The estimated tax liability includes the economic development surcharge imposed under s.
77.93, Stats.
Tax 2.96 Note
Note: See s.
Tax 2.66 for rules relating to the payment of estimated taxes by combined groups.
Tax 2.96(3)(a)(a) Regular interest. Except as provided in
par. (b), additional tax due with the complete return and the economic development surcharge imposed under s.
77.93, Stats., which are not paid by the original due date are subject to interest at 12% per year during the extension period and 1 1/2% per month from the end of the extension period until the date of payment.
Tax 2.96(3)(b)
(b) Delinquent interest. If 90% of the tax shown on the return is not paid by the unextended due date of the return, the difference between that amount and the estimated taxes paid along with any interest due is subject to interest at 11/2% per month until paid regardless of any extension granted for filing the return. The tax shown on the return includes the economic development surcharge imposed under s.
77.93, Stats.
Tax 2.96(3)(c)
(c) Late filing fee. A corporation return filed after the extension period is subject to a $150 late filing fee.
Tax 2.96 History
History: Cr.
Register, February, 1978, No. 266, eff. 3-1-78; am. (1), (2) (a) and (c), (3) (a) and (c), (4) and (5),
Register, September, 1983, No. 333, eff. 10-1-83; am. (1), (2) (a) and (b), (4) and (5), r. (2) (c), renum. (2) (d) to be (2) (c),
Register, February, 1990, No. 410, eff. 3-1-90; r. and recr.
Register, December, 1995, No. 480, eff. 1-1-96;
CR 10-095: am. (1) (a), (3) (a), (b), cr. (1) (am), r. and recr. (2), r. (4)
Register November 2010 No. 659, eff. 12-1-10;
CR 12-011: am. (2) (c), (3) (a) to (c)
Register July 2012 No. 679, eff. 8-1-12.
Tax 2.96 Annotation
Cross Reference: See s. Tax 2.60 for combined reporting definitions relating to this section. See s. Tax 2.65 for rules relating to the designated agent. See s. Tax 2.66 for rules relating to the payment of estimated taxes by combined groups. See s. Tax 2.67 for rules relating to the filing of a combined return.
Tax 2.97
Tax 2.97
Earned income credit eligibility. Tax 2.97(1)
(1)
General. Under s.
71.07 (9e) (ad),
(ah),
(ap) and
(at), Stats., certain persons may claim an earned income credit based on the person's earned income or federal adjusted gross income.
Tax 2.97(2)(a)2.
2. The amount of the person's net earnings from self-employment for the taxable year within the meaning of section
1402 (a) of the Internal Revenue Code, but net earnings shall be determined with regard to the deduction allowed to the person under section
164 (f) of the Internal Revenue Code.
Tax 2.97(2)(b)
(b) "Qualifying child" means, with respect to any person for any taxable year, an individual:
Tax 2.97(2)(b)2.
2. Who, except as provided in
sub. (5) (a) 3., has the same principal place of abode as the person for more than one-half of the taxable year.
Tax 2.97(3)(a)(a) Except as provided in
pars. (b),
(c) and
(d), a person who has a qualifying child for the taxable year may claim the earned income credit.
Tax 2.97(3)(b)
(b) A person may not claim the earned income credit for the taxable year if the person is the qualifying child of another person for that taxable year.
Tax 2.97 Note
Example: You and your daughter lived with your mother during the taxable year. Both you and your mother meet all the requirements for the earned income credit for the taxable year.
Tax 2.97 Note
Your daughter is your qualifying child. Both you and your daughter are qualifying children of your mother.
Tax 2.97 Note
You cannot take the earned income credit because you are your mother's qualifying child.
Tax 2.97(3)(c)
(c) If 2 or more persons would be treated as eligible for the credit with respect to the same qualifying child for taxable years beginning in the same calendar year, only the person with the highest federal adjusted gross income for the taxable year may claim the earned income credit with respect to the qualifying child.
Tax 2.97 Note
Example: You and your 5-year-old son moved in with your mother in April. You are not a qualifying child of your mother. Your son meets the conditions to be a qualifying child for both you and your mother. Your federal adjusted gross income for the taxable year was $7,000 and your mother's was $14,000. Since your mother's federal adjusted gross income was higher, only your mother may claim the earned income credit with respect to your son.
Tax 2.97(3)(d)
(d) A person who claims the foreign earned income exclusion under section
911 of the Internal Revenue Code for the taxable year may not claim the earned income credit.
