Amendment AA2-ASA1-AB133

AB133-ASA1-AA2,248,3 71.10 (3) (a) 2. `Designation added to tax owed.' If the individual owes any tax, the individual shall remit in full the tax due and an additional $1 for the Wisconsin election campaign fund when the individual files a tax return.

AB133-ASA1-AA2,248,7 3. `Designation deducted from refund.' Except as provided under par. (c) if the individual is owed a refund for that year after crediting under ss. 71.75 (9) and 71.80 (3), the department of revenue shall deduct $1 for the Wisconsin election campaign fund from the amount of the refund.

AB133-ASA1-AA2, s. 1719jm Section 1719jm. 71.10 (3) (b) of the statutes is renumbered 71.10 (3) (f) and amended to read:

AB133-ASA1-AA2,249,2 71.10 (3) (f) Administration, certification of amounts confidentiality. The secretary of revenue shall provide a place for those designations on the face of the individual income tax return and shall provide next to that place a statement that a designation will not increase tax liability or reduce a refund. Annually on August 15, the secretary of revenue shall certify to the elections board, the department of administration and the state treasurer under s. 11.50 the total amount of received from all designations made during the preceding fiscal year. If any individual attempts to place any condition or restriction upon a designation, that individual is deemed not to have made a designation on his or her tax return Amounts designated for the Wisconsin election campaign fund under this subsection are not subject to refund to the taxpayer unless the taxpayer submits information to the satisfaction of the department of revenue within 18 months after the date taxes are due or the date the return is filed, whichever is later, that the amount designated is clearly in error. Any refund granted by the department of revenue under this subdivision shall be deducted from the moneys received under this subsection in the fiscal year that the refund is certified. The names of persons making designations under this subsection shall be strictly confidential.

AB133-ASA1-AA2, s. 1719jn Section 1719jn. 71.10 (3) (bm) of the statutes is created to read:

AB133-ASA1-AA2,249,8 71.10 (3) (bm) Errors; failure to remit correct amount. If an individual who owes a tax fails to remit an amount equal to or in excess of the total of the actual tax due, after error corrections, and the amount designated on the return for the Wisconsin election campaign fund, the designation for the Wisconsin election campaign fund is void.

AB133-ASA1-AA2, s. 1719jp Section 1719jp. 71.10 (3) (c) of the statutes is repealed and recreated to read:

AB133-ASA1-AA2,249,12 71.10 (3) (c) Errors; insufficient refund. If an individual is owed a refund that does not equal or exceed $1, after crediting under ss. 71.75 (9) and 71.80 (3) and after error corrections, the designation for the Wisconsin election campaign fund is void.

AB133-ASA1-AA2, s. 1719jr Section 1719jr. 71.10 (3) (d) of the statutes is created to read:

AB133-ASA1-AA2,249,15 71.10 (3) (d) Conditions. If an individual places any conditions on a designation for the Wisconsin election campaign fund, the designation is void.

AB133-ASA1-AA2, s. 1719jt Section 1719jt. 71.10 (3) (e) of the statutes is created to read:

AB133-ASA1-AA2,249,20 71.10 (3) (e) Void designation. If a designation for the Wisconsin election campaign fund is void, the department of revenue shall disregard the designation and determine amounts due, owed, refunded and received without regard to the void designation.".

AB133-ASA1-AA2,249,21 605. Page 851, line 9: after that line insert:

AB133-ASA1-AA2,249,22 " Section 1719p. 71.10 (4) (i) of the statutes is amended to read:

AB133-ASA1-AA2,250,4 71.10 (4) (i) The total of claim of right credit under s. 71.07 (1), farmland preservation credit under subch. IX, homestead credit under subch. VIII, farmland tax relief credit under s. 71.07 (3m), farmers' drought property tax credit under s. 71.07 (2fd), earned income tax credit under s. 71.07 (9e), education credit under s. 71.07 (5r), estimated tax payments under s. 71.09, and taxes withheld under subch. X.".

AB133-ASA1-AA2,250,6 606. Page 853, line 21: delete ", (2dy) and (3s)" and substitute "and, (2dy), (3s) and (5r)".

AB133-ASA1-AA2,250,8 607. Page 873, line 19: after "both" insert ", or that buy or sell lottery prizes if the winning tickets were originally bought in this state".

AB133-ASA1-AA2,250,9 608. Page 873, line 21: after that line insert:

AB133-ASA1-AA2,250,10 " Section 1722yd. 71.23 (2) of the statutes is amended to read:

AB133-ASA1-AA2,251,7 71.23 (2) Franchise tax. For the privilege of exercising its franchise, buying or selling lottery prizes is the winning tickets were originally bought in this state or doing business in this state in a corporate capacity, except as provided under sub. (3), every domestic or foreign corporation, except corporations specified in s. 71.26 (1), and every nuclear decommissioning trust or reserve fund shall annually pay a franchise tax according to or measured by its entire Wisconsin net income of the preceding taxable year at the rate set forth in s. 71.27 (2). In addition, except as provided in sub. (3) and s. 71.26 (1), a corporation that ceases doing business in this state and a nuclear decommissioning trust or reserve fund that is terminated shall pay a special franchise tax according to or measured by its entire Wisconsin net income for the taxable year during which the corporation ceases doing business in this state or the nuclear decommissioning trust or reserve fund is terminated at the rates under s. 71.27 (2). Every corporation organized under the laws of this state or that derives income from sources within this state or from activities that are attributable to this state shall be deemed to be residing within this state for the purposes of this franchise tax. All provisions of this chapter and ch. 73 relating to income taxation of corporations shall apply to franchise taxes imposed under this subsection, unless the context requires otherwise. The tax imposed by this subsection on national banking associations shall be in lieu of all taxes imposed by this state on national banking associations to the extent it is not permissible to tax such associations under federal law.

AB133-ASA1-AA2, s. 1722yf Section 1722yf. 71.25 (5) (a) (intro.) of the statutes is amended to read:

AB133-ASA1-AA2,251,14 71.25 (5) (a) Apportionable income. (intro.) Except as provided in sub. (6), corporations engaged in business both within and without this state are subject to apportionment. Income, gain or loss from the sources listed in this paragraph is presumed apportionable. Apportionable income includes all income or loss of corporations, other than nonapportionable income as specified in par. (b), including, but not limited to, income, gain or loss from the following sources:

AB133-ASA1-AA2, s. 1722ym Section 1722ym. 71.25 (5) (a) 9. of the statutes is amended to read:

AB133-ASA1-AA2,251,24 71.25 (5) (a) 9. Interest and dividends if the operations of the payer are unitary with those of the payee, or if those operations are not unitary but the investment activity from which that income is derived is an integral part of a unitary business and the payer and payee are neither affiliates nor related as parent company and subsidiary. In this subdivision, "investment activity" includes decision making relating to the purchase and sale of stocks and other securities, investing surplus funds and the management and record keeping associated with corporate investments, not including activities of a broker or other agent in maintaining an investment portfolio.

AB133-ASA1-AA2, s. 1722yn Section 1722yn. 71.25 (5) (a) 10. of the statutes is amended to read:

AB133-ASA1-AA2,252,6 71.25 (5) (a) 10. Sale of intangible assets if the operations of the company in which the investment was made were unitary with those of the investing company, or if those operations were not unitary but the investment activity from which that gain or loss was derived is an integral part of a unitary business and the companies were neither affiliates nor related as parent company and subsidiary. In this subdivision, "investment activity" has the meaning given under subd. 9.".

AB133-ASA1-AA2, s. 1722ym Section 1722ym. 71.25 (5) (b) of the statutes is amended to read:

AB133-ASA1-AA2,252,15 71.25 (5) (b) Nonapportionable income. 1. Income, gain or loss from the sale of nonbusiness real property or nonbusiness tangible personal property, rental of nonbusiness real property or nonbusiness tangible personal property and royalties from nonbusiness real property or nonbusiness tangible personal property are nonapportionable and shall be allocated to the situs of the property , except that all income that is realized from the sale of or purchase and subsequent sale or redemption of lottery prizes if the winning tickets were originally bought in this state shall be allocated to this state.

AB133-ASA1-AA2,252,21 2. All income, gain or loss from intangible property that is earned by a personal holding company, as defined in section 542 of the internal revenue code, as amended to December 31, 1974, shall be allocated to the residence of the taxpayer, except that all income that is realized from the sale of or purchase and subsequent sale or redemption of lottery prizes if the winning tickets were originally bought in this state shall be allocated to this state.".

AB133-ASA1-AA2,252,24 609. Page 874, line 9: delete that line and substitute "businesses except financial organizations, public utilities, telecommunications companies, railroads, sleeping car".

AB133-ASA1-AA2,253,1 610. Page 874, line 20: delete lines 20 to 23 and substitute:

AB133-ASA1-AA2,253,5 "71.25 (6) (a) For taxable years beginning before January 1, 2001, an apportionment fraction composed of a sales factor under sub. (9) representing 50% of the fraction, a property factor under sub. (7) representing 25% of the fraction and a payroll factor under sub. (8) representing 25% of the fraction.

AB133-ASA1-AA2, s. 1729bb Section 1729bb. 71.25 (6) (am) of the statutes is created to read:

AB133-ASA1-AA2,253,10 71.25 (6) (am) For taxable years beginning after December 31, 2000, and before January 1, 2002, an apportionment fraction composed of a sales factor under sub. (9) representing 63% of the fraction, a property factor under sub. (7) representing 18.5% of the fraction and a payroll factor under sub. (8) representing 18.5% of the fraction.".

AB133-ASA1-AA2,253,12 611. Page 878, line 1: after "of the service" insert ", except as provided in subd. 4".

AB133-ASA1-AA2,253,13 612. Page 878, line 21: after that line insert:

AB133-ASA1-AA2,253,19 "4. If the benefit of a service is received in this state, as provided under this subsection, and the service is performed in a state that does not attribute the receipts from a service to the state in which the purchaser of the service receives the service, the taxpayer may elect, by a method prescribed by the department, to attribute the receipts from the service to this state in proportion to the direct cost of performing such service.".

AB133-ASA1-AA2,253,20 613. Page 887, line 20: after that line insert:

AB133-ASA1-AA2,253,21 " Section 1738nb. 71.25 (10) (b) of the statutes is amended to read:

AB133-ASA1-AA2,254,8 71.25 (10) (b) In this section, "public utility" means any business entity which owns or operates any plant, equipment, property, franchise, or license for the transmission of communications or the production, transmission, sale, delivery, or furnishing of electricity, water or steam the rates of charges for goods or services of which have been established or approved by a federal, state or local government or governmental agency. "Public utility" also means any business entity providing service to the public and engaged in the transportation of goods and persons for hire, as defined in s. 194.01 (4), regardless of whether or not the entity's rates or charges for services have been established or approved by a federal, state or local government or governmental agency. This paragraph does not apply to gas and electric companies for taxable years beginning after December 31, 1999.".

AB133-ASA1-AA2,254,10 614. Page 888, line 3: after "(9d)" insert "and the net business income of gas and electric companies shall be apportioned under sub. (6)".

AB133-ASA1-AA2,254,11 615. Page 888, line 25: after that line insert:

AB133-ASA1-AA2,254,12 " Section 1738t. 71.26 (1) (a) of the statutes is amended to read:

AB133-ASA1-AA2,255,14 71.26 (1) (a) Certain corporations. Income of corporations organized under ch. 185, except income of a cooperative sickness care association organized under s. 185.981, or of a service insurance corporation organized under ch. 613, that is derived from a health maintenance organization as defined in s. 609.01 (2) or a limited service health organization as defined in s. 609.01 (3), or operating under subch. I of ch. 616 which are bona fide cooperatives operated without pecuniary profit to any shareholder or member, or operated on a cooperative plan pursuant to which they determine and distribute their proceeds in substantial compliance with s. 185.45, and the income, except the unrelated business taxable income as defined in section 512 of the internal revenue code and except income that is derived from a health maintenance organization as defined in s. 609.01 (2) or a limited service health organization as defined in s. 609.01 (3), of all religious, scientific, educational, benevolent or other corporations or associations of individuals not organized or conducted for pecuniary profit. This paragraph does not apply to the income of savings banks, mutual loan corporations or savings and loan associations. This paragraph does not apply to income that is realized from the sale of or purchase and subsequent sale or redemption of lottery prizes if the winning tickets were originally bought in this state. This paragraph applies to the income of credit unions except to the income of any credit union that is derived from public deposits for any taxable year in which the credit union is approved as a public depository under ch. 34 and acts as a depository of state or local funds under s. 186.113 (20). For purposes of this paragraph, the income of a credit union that is derived from public deposits is the product of the credit union's gross annual income for the taxable year multiplied by a fraction, the numerator of which is the average monthly balance of public deposits in the credit union during the taxable year, and the denominator of which is the average monthly balance of all deposits in the credit union during the taxable year.".

AB133-ASA1-AA2,255,15 616. Page 889, line 11: delete "and (1dy)" and substitute ", (1dy) and (5r)".

AB133-ASA1-AA2,255,16 617. Page 913, line 7: after that line insert:

AB133-ASA1-AA2,255,17 " Section 1744bd. 71.28 (2m) (b) 1. a. of the statutes is amended to read:

AB133-ASA1-AA2,256,2 71.28 (2m) (b) 1. a. Subject to the limitations provided in this subsection and s. 71.80 (3) and (3m), a claimant may claim as a credit against Wisconsin income or franchise taxes otherwise due, the amount derived under par. (c). If the allowable amount of claim exceeds the income or franchise taxes otherwise due on or measured by the claimant's income or if there are no Wisconsin income or franchise taxes due on or measured by the claimant's income, the amount of the claim not used as an offset against income or franchise taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft paid from the appropriation under s. 20.835 (2) (q) (dn).

AB133-ASA1-AA2, s. 1744be Section 1744be. 71.28 (2m) (b) 1. a. of the statutes, as affected by 1999 Wisconsin Act .... (this act), is repealed and recreated to read:

AB133-ASA1-AA2,256,12 71.28 (2m) (b) 1. a. Subject to the limitations provided in this subsection and s. 71.80 (3) and (3m), a claimant may claim as a credit against Wisconsin income taxes otherwise due, the amount derived under par. (c). If the allowable amount of claim exceeds the income taxes otherwise due on the claimant's income or if there are no Wisconsin income taxes due on the claimant's income, the amount of the claim not used as an offset against income taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft paid from the appropriation under s. 20.835 (2) (q).".

AB133-ASA1-AA2,256,13 618. Page 913, line 7: after that line insert:

AB133-ASA1-AA2,256,14 " Section 1744bd. 71.28 (2m) (c) 1. of the statutes is amended to read:

AB133-ASA1-AA2,256,21 71.28 (2m) (c) 1. Any claimant may claim against taxes otherwise due under this chapter 10% a percentage, as determined by the department under subd. 3., of the property taxes accrued in the taxable year to which the claim relates, up to a maximum claim of $1,000 $2,000 for taxable years ending before January 1, 2001, and up to a maximum claim of $1,500 for taxable years beginning after December 31, 2000, except that the credit under this subsection plus the credit under subch. IX may not exceed 95% of the property taxes accrued on the farm.

AB133-ASA1-AA2, s. 1744bg Section 1744bg. 71.28 (2m) (c) 3. of the statutes is created to read:

AB133-ASA1-AA2,257,4 71.28 (2m) (c) 3. The department shall annually adjust the percentage that is used to determine the amount of the claim under subd. 1. based on the estimated number of claims and the amount estimated to be expended from the appropriation under s. 20.835 (2) (q), as determined under s. 79.13. The department shall incorporate the annually adjusted percentage into the income tax forms and instructions.".

AB133-ASA1-AA2,257,5 619. Page 914, line 4: after that line insert:

AB133-ASA1-AA2,257,6 " Section 1746g. 71.28 (5r) of the statutes is created to read:

AB133-ASA1-AA2,257,7 71.28 (5r) Education credit. (a) In this subsection:

AB133-ASA1-AA2,257,8 1. "Claimant" means a corporation that files a claim under this subsection.

AB133-ASA1-AA2,257,10 2. "Degree-granting program" means an education program for which an associate, a bachelor's or a graduate degree is awarded upon successful completion.

AB133-ASA1-AA2,257,14 3. "Qualified postsecondary institution" means a University of Wisconsin System institution, a technical college system institution or a regionally accredited 4-year nonprofit college or university having its regional headquarters and principal place of business in this state, notwithstanding s. 16.973 (1) (b).

AB133-ASA1-AA2,257,19 (b) A claimant may claim as a credit against the tax imposed under this subchapter an amount equal to 50% of the tuition that the claimant paid or incurred during the taxable year for an individual to participate in an education program of a qualified postsecondary institution, if the individual is enrolled in a degree-granting program.

AB133-ASA1-AA2,257,22 (c) A claimant may not claim the credit under par. (b) for any tuition amounts that the claimant has excluded under s. 71.05 (6) (b) 28. or under section 127 of the Internal Revenue Code.

AB133-ASA1-AA2,257,24 (d) The carry-over provisions of sub. (4) (e) and (f), as they apply to the credit under sub. (4), apply to the credit under this subsection.

AB133-ASA1-AA2,258,8 (e) Partnerships, limited liability companies and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and the amount of, the credit are based on their payment of tuition under par. (b). A partnership, limited liability company or tax-option corporation shall compute the amount of credit that each of its partners, members or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies and shareholders of tax-option corporations may claim the credit in proportion to their ownership interest.

AB133-ASA1-AA2,258,10 (f) Subsection (4) (g) and (h), as it applies to the credit under sub. (4), applies to the credit under this subsection.".

AB133-ASA1-AA2,258,11 620. Page 914, line 6: after that line insert:

AB133-ASA1-AA2,258,12 " Section 1747n. 71.30 (3) (f) of the statutes is amended to read:

AB133-ASA1-AA2,258,16 71.30 (3) (f) The total of farmers' drought property tax credit under s. 71.28 (1fd), farmland preservation credit under subch. IX, farmland tax relief credit under s. 71.28 (2m), education credit under s. 71.28 (5r) and estimated tax payments under s. 71.29.".

AB133-ASA1-AA2,258,18 621. Page 917, line 5: delete ", (1dy) and (3)" and substitute "and, (1dy), (3) and (5r)".

AB133-ASA1-AA2,258,19 622. Page 927, line 8: after that line insert:

AB133-ASA1-AA2,258,20 " Section 1748Lm. 71.362 (1) of the statutes is amended to read:

AB133-ASA1-AA2,259,2 71.362 (1) All tax-option items of nonresident individuals, nonresident estates and nonresident trusts derived from a tax-option corporation not requiring apportionment under sub. (2) shall follow the situs of the business of the corporation from which they are derived, except that all income that is realized from the sale of or purchase and subsequent sale or redemption of lottery prizes if the winning tickets were originally bought in this state shall be allocated to this state.

AB133-ASA1-AA2, s. 1748Ln Section 1748Ln. 71.362 (2) of the statutes is amended to read:

AB133-ASA1-AA2,259,16 71.362 (2) Nonresident individuals, nonresident estates and nonresident trusts deriving income from a tax-option corporation which is engaged in business within and without this state shall be taxed only on the income of the corporation derived from business transacted and property located in this state and losses and other items of the corporation deductible by such shareholders shall be limited to their proportionate share of the Wisconsin loss or other item, except that all income that is realized from the sale of or purchase and subsequent sale or redemption of lottery prizes if the winning tickets were originally bought in this state shall be allocated to this state. For purposes of this subsection, all intangible income of tax-option corporations passed through to shareholders is business income that follows the situs of the business, except that all income that is realized from the sale of or purchase and subsequent sale or redemption of lottery prizes if the winning tickets were originally bought in this state shall be allocated to this state.".

AB133-ASA1-AA2,259,18 623. Page 937, line 24: after "both" insert ", or that buy or sell lottery prizes if the winning tickets were originally bought in this state".

AB133-ASA1-AA2,259,19 624. Page 938, line 2: after that line insert:

AB133-ASA1-AA2,259,20 " Section 1748yb. 71.43 (2) of the statutes is amended to read:

AB133-ASA1-AA2,260,17 71.43 (2) Franchise tax on corporations. For the privilege of exercising its franchise, buying or selling lottery prizes if the winning tickets were originally bought in this state or doing business in this state in a corporate capacity, except as provided under s. 71.23 (3), every domestic or foreign corporation, except corporations specified in ss. 71.26 (1) and 71.45 (1), shall annually pay a franchise tax according to or measured by its entire Wisconsin net income of the preceding taxable year at the rates set forth in s. 71.46 (2). In addition, except as provided in ss. 71.23 (3), 71.26 (1) and 71.45 (1), a corporation that ceases doing business in this state shall pay a special franchise tax according to or measured by its entire Wisconsin net income for the taxable year during which the corporation ceases doing business in this state at the rate under s. 71.46 (2). Every corporation organized under the laws of this state shall be deemed to be residing within this state for the purposes of this franchise tax. All provisions of this chapter and ch. 73 relating to income taxation of corporations shall apply to franchise taxes imposed under this subsection, unless the context requires otherwise. The tax imposed by this subsection on insurance companies subject to taxation under this chapter shall be based on Wisconsin net income computed under s. 71.45, and no other provision of this chapter relating to computation of taxable income for other corporations shall apply to such insurance companies. All other provisions of this chapter shall apply to insurance companies subject to taxation under this chapter unless the context clearly requires otherwise.

AB133-ASA1-AA2, s. 1748ym Section 1748ym. 71.45 (1) of the statutes is amended to read:

AB133-ASA1-AA2,261,12 71.45 (1) Exempt and excludable income. There shall be exempt from taxation under this subchapter income of insurers exempt from federal income taxation pursuant to section 501 (c) (15) of the internal revenue code, town mutuals organized under or subject to ch. 612, foreign insurers, and domestic insurers engaged exclusively in life insurance business, domestic insurers insuring against financial loss by reason of nonpayment of principal, interest and other sums agreed to be paid under the terms of any note or bond or other evidence of indebtedness secured by a mortgage, deed of trust or other instrument constituting a lien or charge on real estate and corporations organized under ch. 185, but not including income of cooperative sickness care associations organized under s. 185.981, or of a service insurance corporation organized under ch. 613, that is derived from a health maintenance organization as defined in s. 609.01 (2) or a limited service health organization as defined in s. 609.01 (3), or operating under subch. I of ch. 616 which are bona fide cooperatives operated without pecuniary profit to any shareholder or member, or operated on a cooperative plan pursuant to which they determine and distribute their proceeds in substantial compliance with s. 185.45. This subsection does not apply to income that is realized from the sale of or purchase and subsequent sale or redemption of lottery prizes if the winning tickets were originally bought in this state.".

AB133-ASA1-AA2,261,13 625. Page 938, line 5: after "(1dy)" insert "and (5r)".

AB133-ASA1-AA2,261,14 626. Page 938, line 23: after that line insert:

AB133-ASA1-AA2,261,15 " Section 1749p. 71.45 (2) (a) 15. of the statutes is created to read:

AB133-ASA1-AA2,261,18 71.45 (2) (a) 15. By subtracting from federal taxable income all income that is realized from the purchase and subsequent sale or redemption of lottery prizes that is treated as nonapportionable income under sub. (3r).".

AB133-ASA1-AA2,261,19 627. Page 941, line 10: after that line insert:

AB133-ASA1-AA2,261,20 " Section 1753d. 71.45 (3r) of the statutes is created to read:

AB133-ASA1-AA2,261,23 71.45 (3r) Allocation of certain proceeds. All income that is realized from the purchase and subsequent sale or redemption of lottery prizes if the winning tickets were originally bought in this state shall be allocated to this state.".

AB133-ASA1-AA2,261,24 628. Page 941, line 21: after that line insert: