2001 - 2002 LEGISLATURE
February 20, 2002 - Introduced by Representatives Schooff, Berceau, Pocan and
Shilling, cosponsored by Senators Burke and Schultz. Referred to
Committee on Housing.
AB840,1,7 1An Act to renumber 44.02 (24); to renumber and amend 71.07 (9m) (a), 71.07
2(9r) (a), 71.28 (6) (a) and 71.47 (6) (a); to amend 71.07 (9m) (c), 71.08 (1) (intro.),
371.28 (6) (c) and 71.47 (6) (c); and to create 44.02 (24) (b), 44.02 (24d), 71.07
4(9m) (a) 2., 71.07 (9m) (cm), 71.07 (9m) (g), 71.07 (9r) (a) 2., 71.28 (6) (a) 2., 71.28
5(6) (cm), 71.28 (6) (g), 71.47 (6) (a) 2., 71.47 (6) (cm) and 71.47 (6) (g) of the
6statutes; relating to: the supplement to the federal historic rehabilitation tax
7credit and the state historic rehabilitation tax credit.
Analysis by the Legislative Reference Bureau
Under current law, a person who is eligible to claim a federal income tax credit
equal to either 10% of qualified expenses related to rehabilitating a qualified
building in this state or 20% of qualified expenses related to rehabilitating historic
property in this state may also claim a supplemental state income or franchise tax
credit that is equal to 5% of such qualified expenses.
Under the bill, for taxable years beginning in 2003, a person who is eligible to
claim the federal income tax credit for rehabilitating qualified buildings or historic
property in this state may claim a supplemental state income tax or franchise tax
credit that is equal to 20% of the qualified expenses related to rehabilitating a
qualified building or historic property. In addition, a person who is not eligible to
claim the federal rehabilitation tax credit because the person's qualified expenses do

not satisfy the adjusted-basis requirement under federal law may claim the state
rehabilitation credit, if the person's qualified expenses are at least $10,000 and the
rehabilitation is approved, and the expenses are certified, by the state historical
society. The state historical society may charge and collect a fee for such certification
in an amount equal to 1% of the qualified expenses, but not less than $150 nor more
than $10,000.
Under current law, a person may claim an income tax credit equal to 25% of the
qualified expenses to preserve or rehabilitate historic property that is used as an
owner-occupied personal residence. The state historical society certifies such
expenses.
Under this bill, for taxable years beginning in 2003, a person may claim an
income tax credit equal to 30% of the qualified expenses to preserve or rehabilitate
historic property that is used as an owner-occupied personal residence. The state
historical society may charge and collect a fee for certifying such expenses. The
amount of the fee is to be determined by rule by the state historical society.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB840, s. 1 1Section 1. 44.02 (24) of the statutes is renumbered 44.02 (24) (a).
AB840, s. 2 2Section 2. 44.02 (24) (b) of the statutes is created to read:
AB840,2,53 44.02 (24) (b) Charge a fee for a certification under par. (a) in an amount to be
4determined by rule by the historical society. The historical society shall collect the
5fee under this paragraph when an applicant applies for certification under par. (a).
AB840, s. 3 6Section 3. 44.02 (24d) of the statutes is created to read:
AB840,2,117 44.02 (24d) (a) Promulgate by rule procedures, standards, and forms necessary
8to certify, and shall certify, expenditures for preservation or rehabilitation of historic
9property for the purposes of ss. 71.07 (9m) (a) and (cm), 71.28 (6) (a) and (cm), and
1071.47 (6) (a) and (cm). Such standards shall be substantially similar to the standards
11used by the secretary of the interior to certify rehabilitations under 26 USC 47 (c) (2).
AB840,3,312 (b) Charge a fee for a certification under par. (a) equal to 1% of the qualified
13rehabilitation expenditures for the historic property that is the subject of the

1certification, except that no fee under this paragraph may be less than $150 nor more
2than $10,000. The historical society shall collect the fee under this paragraph when
3an applicant applies for certification under par. (a).
AB840, s. 4 4Section 4. 71.07 (9m) (a) of the statutes is renumbered 71.07 (9m) (a) 1. and
5amended to read:
AB840,3,136 71.07 (9m) (a) 1. Any person may credit against taxes otherwise due under this
7chapter, up to the amount of those taxes, an amount equal to 5% of the costs of
8qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the internal
9revenue code
Internal Revenue Code, for certified historic structures on property
10located in this state, if the physical work of construction or destruction in preparation
11for construction begins after December 31, 1988, and before January 1, 2003, and the
12rehabilitated property is placed in service after June 30, 1989, and before July 1,
132003
.
AB840, s. 5 14Section 5. 71.07 (9m) (a) 2. of the statutes is created to read:
AB840,3,2115 71.07 (9m) (a) 2. Any person may credit against taxes otherwise due under this
16chapter, up to the amount of those taxes, an amount equal to 20% of the costs of
17qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the Internal
18Revenue Code, for certified historic structures on property located in this state, if the
19physical work of construction or destruction in preparation for construction begins
20after December 31, 2002, and the rehabilitated property is placed in service after
21June 30, 2003.
AB840, s. 6 22Section 6. 71.07 (9m) (c) of the statutes is amended to read:
AB840,4,323 71.07 (9m) (c) No Except as provided in par. (cm), no person may claim the
24credit under this subsection unless the claimant includes with the claimant's return
25evidence that the rehabilitation was approved recommended by the state historic

1preservation officer for approval
by the secretary of the interior under 36 CFR 67.6
2before the physical work of construction, or destruction in preparation for
3construction, began.
AB840, s. 7 4Section 7. 71.07 (9m) (cm) of the statutes is created to read:
AB840,4,135 71.07 (9m) (cm) A person whose qualified rehabilitation expenditures do not
6satisfy the adjusted basis requirement under section 47 (c) (1) of the Internal
7Revenue Code, but who otherwise would be eligible to claim the rehabilitation credit
8under section 47 of the Internal Revenue Code, may claim the credit under par. (a),
9if the person's qualified rehabilitation expenditures, as defined in section 47 (c) (2)
10of the Internal Revenue Code, are at least $10,000; if the rehabilitation is approved
11by the state historical society before the physical work of construction, or destruction
12in preparation for construction, begins; and if the person includes evidence of such
13approval with the person's return.
AB840, s. 8 14Section 8. 71.07 (9m) (g) of the statutes is created to read:
AB840,4,2215 71.07 (9m) (g) A person who has incurred qualified rehabilitation
16expenditures, as defined in section 47 (c) (2) of the Internal Revenue Code, for
17certified historic structures located in this state, as described in par. (a), but who is
18not a resident of this state and who is not required to file a return under this chapter,
19may enter into an agreement with another person, with the department of revenue's
20approval and in the manner prescribed by the department, so that the other person
21may claim the credit under this subsection, if the other person is subject to the taxes
22imposed under s. 71.02.
AB840, s. 9 23Section 9. 71.07 (9r) (a) of the statutes is renumbered 71.07 (9r) (a) 1. and
24amended to read:
AB840,5,11
171.07 (9r) (a) 1. For taxable years beginning on or after August 1, 1988, and
2before January 1, 2003,
any natural person may credit against taxes otherwise due
3under s. 71.02 an amount equal to 25% of the costs of preservation or rehabilitation
4of historic property located in this state, including architectural fees and costs
5incurred in preparing nomination forms for listing in the national register of historic
6places in Wisconsin or the state register of historic places, if the nomination is made
7within 5 years prior to submission of a preservation or rehabilitation plan under par.
8(b) 3. b., and if the physical work of construction or destruction in preparation for
9construction begins after December 31, 1988, and before January 1, 2003, except that
10the credit may not exceed $10,000, or $5,000 for married persons filing separately,
11for any preservation or rehabilitation project.
AB840, s. 10 12Section 10. 71.07 (9r) (a) 2. of the statutes is created to read:
AB840,5,2213 71.07 (9r) (a) 2. For taxable years beginning after December 31, 2002, any
14natural person may credit against taxes otherwise due under s. 71.02 an amount
15equal to 30% of the costs of preservation or rehabilitation of historic property located
16in this state, including architectural fees and costs incurred in preparing nomination
17forms for listing in the national register of historic places in Wisconsin or the state
18register of historic places, if the nomination is made within 5 years prior to
19submission of a preservation or rehabilitation plan under par. (b) 3. b., and if the
20physical work of construction or destruction in preparation for construction begins
21after December 31, 2002, except that the credit may not exceed $10,000, or $5,000
22for married persons filing separately, for any preservation or rehabilitation project.
AB840, s. 11 23Section 11. 71.08 (1) (intro.) of the statutes is amended to read:
AB840,6,724 71.08 (1) Imposition. (intro.) If the tax imposed on a natural person, married
25couple filing jointly, trust or estate under s. 71.02, not considering the credits under

1ss. 71.07 (1), (2dd), (2de), (2di), (2dj), (2dL), (2dr), (2ds), (2dx), (2fd), (3m), (3s), (6) and,
2(9e), and (9r), 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1ds), (1dx), (1fd), (2m) and (3) and
371.47 (1dd), (1de), (1di), (1dj), (1dL), (1ds), (1dx), (1fd), (2m) and (3) and subchs. VIII
4and IX and payments to other states under s. 71.07 (7), is less than the tax under this
5section, there is imposed on that natural person, married couple filing jointly, trust
6or estate, instead of the tax under s. 71.02, an alternative minimum tax computed
7as follows:
AB840, s. 12 8Section 12. 71.28 (6) (a) of the statutes is renumbered 71.28 (6) (a) 1. and
9amended to read:
AB840,6,1710 71.28 (6) (a) 1. Any person may credit against taxes otherwise due under this
11chapter, up to the amount of those taxes, an amount equal to 5% of the costs of
12qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the internal
13revenue code
Internal Revenue Code, for certified historic structures on property
14located in this state, if the physical work of construction or destruction in preparation
15for construction begins after December 31, 1988, and before January 1, 2003, and the
16rehabilitated property is placed in service after June 30, 1989, and before July 1,
172003
.
AB840, s. 13 18Section 13. 71.28 (6) (a) 2. of the statutes is created to read:
AB840,6,2519 71.28 (6) (a) 2. Any person may credit against taxes otherwise due under this
20chapter, up to the amount of those taxes, an amount equal to 20% of the costs of
21qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the Internal
22Revenue Code, for certified historic structures on property located in this state, if the
23physical work of construction or destruction in preparation for construction begins
24after December 31, 2002, and the rehabilitated property is placed in service after
25June 30, 2003.
AB840, s. 14
1Section 14. 71.28 (6) (c) of the statutes is amended to read:
AB840,7,72 71.28 (6) (c) No Except as provided in par. (cm), no person may claim the credit
3under this subsection unless the claimant includes with the claimant's return
4evidence that the rehabilitation was approved recommended by the state historic
5preservation officer for approval
by the secretary of the interior under 36 CFR 67.6
6before the physical work of construction, or destruction in preparation for
7construction, began.
AB840, s. 15 8Section 15. 71.28 (6) (cm) of the statutes is created to read:
AB840,7,179 71.28 (6) (cm) A person whose qualified rehabilitation expenditures do not
10satisfy the adjusted basis requirement under section 47 (c) (1) of the Internal
11Revenue Code, but who otherwise would be eligible to claim the rehabilitation credit
12under section 47 of the Internal Revenue Code, may claim the credit under par. (a),
13if the person's qualified rehabilitation expenditures, as defined in section 47 (c) (2)
14of the Internal Revenue Code, are at least $10,000; if the rehabilitation is approved
15by the state historical society before the physical work of construction, or destruction
16in preparation for construction, begins; and if the person includes evidence of such
17approval with the person's return.
AB840, s. 16 18Section 16. 71.28 (6) (g) of the statutes is created to read:
AB840,8,219 71.28 (6) (g) A person who has incurred qualified rehabilitation expenditures,
20as defined in section 47 (c) (2) of the Internal Revenue Code, for certified historic
21structures located in this state, as described in par. (a), but who is not a resident of
22this state and who is not required to file a return under this chapter, may enter into
23an agreement with another person, with the department of revenue's approval and
24in the manner prescribed by the department, so that the other person may claim the

1credit under this subsection, if the other person is subject to the taxes imposed under
2s. 71.23.
AB840, s. 17 3Section 17. 71.47 (6) (a) of the statutes is renumbered 71.47 (6) (a) 1. and
4amended to read:
AB840,8,125 71.47 (6) (a) 1. Any person may credit against taxes otherwise due under this
6chapter, up to the amount of those taxes, an amount equal to 5% of the costs of
7qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the internal
8revenue code
Internal Revenue Code, for certified historic structures on property
9located in this state, if the physical work of construction or destruction in preparation
10for construction begins after December 31, 1988, and before January 1, 2003, and the
11rehabilitated property is placed in service after June 30, 1989, and before July 1
122003
.
AB840, s. 18 13Section 18. 71.47 (6) (a) 2. of the statutes is created to read:
AB840,8,2014 71.47 (6) (a) 2. Any person may credit against taxes otherwise due under this
15chapter, up to the amount of those taxes, an amount equal to 20% of the costs of
16qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the Internal
17Revenue Code, for certified historic structures on property located in this state, if the
18physical work of construction or destruction in preparation for construction begins
19after December 31, 2002, and the rehabilitated property is placed in service after
20June 30, 2003.
AB840, s. 19 21Section 19. 71.47 (6) (c) of the statutes is amended to read:
AB840,9,222 71.47 (6) (c) No Except as provided in par. (cm), no person may claim the credit
23under this subsection unless the claimant includes with the claimant's return
24evidence that the rehabilitation was approved recommended by the state historic
25preservation officer for approval
by the secretary of the interior under 36 CFR 67.6

1before the physical work of construction, or destruction in preparation for
2construction, began.
AB840, s. 20 3Section 20. 71.47 (6) (cm) of the statutes is created to read:
AB840,9,124 71.47 (6) (cm) A person whose qualified rehabilitation expenditures do not
5satisfy the adjusted basis requirement under section 47 (c) (1) of the Internal
6Revenue Code, but who otherwise would be eligible to claim the rehabilitation credit
7under section 47 of the Internal Revenue Code, may claim the credit under par. (a),
8if the person's qualified rehabilitation expenditures, as defined in section 47 (c) (2)
9of the Internal Revenue Code, are at least $10,000; if the rehabilitation is approved
10by the state historical society before the physical work of construction, or destruction
11in preparation for construction, begins; and if the person includes evidence of such
12approval with the person's return.
AB840, s. 21 13Section 21. 71.47 (6) (g) of the statutes is created to read:
AB840,9,2114 71.47 (6) (g) A person who has incurred qualified rehabilitation expenditures,
15as defined in section 47 (c) (2) of the Internal Revenue Code, for certified historic
16structures located in this state, as described in par. (a), but who is not a resident of
17this state and who is not required to file a return under this chapter, may enter into
18an agreement with another person, with the department of revenue's approval and
19in the manner prescribed by the department, so that the other person may claim the
20credit under this subsection, if the other person is subject to the taxes imposed under
21s. 71.43.
AB840, s. 22 22Section 22. Initial applicability.
AB840,9,2323 (1) This act first applies to taxable years beginning on January 1, 2003.
AB840,9,2424 (End)
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