Partnerships, limited liability companies, and tax-option corporations
compute the credit but pass it on to the partners, members, and shareholders in
proportion to their ownership interests. If the credit claimed by a business exceeds
the business' tax liability, the state will not issue a refund check, but the business
may carry forward any remaining credit to subsequent taxable years.
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:
SB76, s. 1 5Section 1. 71.05 (6) (a) 15. of the statutes is amended to read:
SB76,2,5
171.05 (6) (a) 15. The amount of the credits computed under s. 71.07 (2dd), (2de),
2(2di), (2dj), (2dL), (2dr), (2ds), (2dx) and, (3s), and (5dv) and not passed through by
3a partnership, limited liability company, or tax-option corporation that has added
4that amount to the partnership's, company's, or tax-option corporation's income
5under s. 71.21 (4) or 71.34 (1) (g).
SB76, s. 2 6Section 2. 71.07 (5dv) of the statutes is created to read:
SB76,2,87 71.07 (5dv) Small business guarantee fee credit. (a) In this subsection,
8"claimant" means a person who files a claim under this subsection.
SB76,2,129 (b) Subject to the limitations provided in this subsection, a claimant may claim
10as a credit against the tax imposed under s. 71.02 an amount equal to the amount
11the claimant paid in the taxable year for a guarantee fee to obtain financing that is
12guaranteed by the federal small business administration.
SB76,2,1513 (c) No credit may be allowed under this subsection unless the claimant submits
14with the claimant's return documentation, as determined by the department of
15revenue, that the claimant paid a fee as described under par. (b).
SB76,2,1716 (d) No credit may be allowed under this subsection for any portion of the
17guarantee fee that the claimant claims as a deduction for federal tax purposes.
SB76,2,1918 (e) The carry-over provisions of s. 71.28 (4) (e) and (f), as they apply to the credit
19under s. 71.28 (4), apply to the credit under this subsection.
SB76,3,220 (f) Partnerships, limited liability companies, and tax-option corporations may
21not claim the credit under this subsection, but the eligibility for, and the amount of,
22the credit are based on their payment of a fee as described under par. (b). A
23partnership, limited liability company, or tax-option corporation shall compute the
24amount of credit that each of its partners, members, or shareholders may claim and
25shall provide that information to each of them. Partners, members of limited liability

1companies, and shareholders of tax-option corporations may claim the credit in
2proportion to their ownership interests.
SB76,3,43 (g) Section 71.28 (4) (g) and (h), as it applies to the credit under s. 71.28 (4),
4applies to the credit under this subsection.
SB76, s. 3 5Section 3. 71.10 (4) (cp) of the statutes is created to read:
SB76,3,66 71.10 (4) (cp) The small business guarantee fee credit under s. 71.07 (5dv).
SB76, s. 4 7Section 4. 71.21 (4) of the statutes is amended to read:
SB76,3,108 71.21 (4) Credits computed by a partnership under s. 71.07 (2dd), (2de), (2di),
9(2dj), (2dL), (2ds), (2dx) and, (3s) , and (5dv) and passed through to partners shall be
10added to the partnership's income.
SB76, s. 5 11Section 5. 71.26 (2) (a) of the statutes is amended to read:
SB76,4,212 71.26 (2) (a) Corporations in general. The "net income" of a corporation means
13the gross income as computed under the internal revenue code Internal Revenue
14Code
as modified under sub. (3) minus the amount of recapture under s. 71.28 (1di)
15plus the amount of credit computed under s. 71.28 (1) and (3) to (5) plus the amount
16of the credit computed under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1ds) and, (1dx),
17and (5dv) and not passed through by a partnership, limited liability company, or
18tax-option corporation that has added that amount to the partnership's, limited
19liability company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1)
20(g) plus the amount of losses from the sale or other disposition of assets the gain from
21which would be wholly exempt income, as defined in sub. (3) (L), if the assets were
22sold or otherwise disposed of at a gain and minus deductions, as computed under the
23internal revenue code Internal Revenue Code as modified under sub. (3), plus or
24minus, as appropriate, an amount equal to the difference between the federal basis
25and Wisconsin basis of any asset sold, exchanged, abandoned, or otherwise disposed

1of in a taxable transaction during the taxable year, except as provided in par. (b) and
2s. 71.45 (2) and (5).
SB76, s. 6 3Section 6. 71.28 (5dv) of the statutes is created to read:
SB76,4,54 71.28 (5dv) Small business guarantee fee credit. (a) In this subsection,
5"claimant" means a person who files a claim under this subsection.
SB76,4,96 (b) Subject to the limitations provided under this subsection, a claimant may
7claim as a credit against the tax imposed under s. 71.23 an amount equal to the
8amount the claimant paid in the taxable year for a guarantee fee to obtain financing
9that is guaranteed by the federal small business administration.
SB76,4,1210 (c) No credit may be allowed under this subsection unless the claimant submits
11with the claimant's return documentation, as determined by the department of
12revenue, that the claimant paid a fee as described under par. (b).
SB76,4,1413 (d) No credit may be allowed under this subsection for any portion of the
14guarantee fee that the claimant claims as a deduction for federal tax purposes.
SB76,4,1615 (e) The carry-over provisions of sub. (4) (e) and (f), as they apply to the credit
16under sub. (4), apply to the credit under this subsection.
SB76,4,2417 (f) Partnerships, limited liability companies, and tax-option corporations may
18not claim the credit under this subsection, but the eligibility for, and the amount of,
19the credit are based on their payment of a fee as described under par. (b). A
20partnership, limited liability company, or tax-option corporation shall compute the
21amount of credit that each of its partners, members, or shareholders may claim and
22shall provide that information to each of them. Partners, members of limited liability
23companies, and shareholders of tax-option corporations may claim the credit in
24proportion to their ownership interests.
SB76,5,2
1(g) Subsection (4) (g) and (h), as it applies to the credit under sub. (4), applies
2to the credit under this subsection.
SB76, s. 7 3Section 7. 71.30 (3) (dm) of the statutes is created to read:
SB76,5,44 71.30 (3) (dm) The small business guarantee fee credit under s. 71.28 (5dv).
SB76, s. 8 5Section 8. 71.34 (1) (g) of the statutes is amended to read:
SB76,5,86 71.34 (1) (g) An addition shall be made for credits computed by a tax-option
7corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1ds), (1dx) and, (3), and
8(5dv)
and passed through to shareholders.
SB76, s. 9 9Section 9. 71.45 (2) (a) 10. of the statutes is amended to read:
SB76,5,1510 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
11computed under s. 71.47 (1dd) to (1dx) and (5dv) and not passed through by a
12partnership, limited liability company, or tax-option corporation that has added that
13amount to the partnership's, limited liability company's, or tax-option corporation's
14income under s. 71.21 (4) or 71.34 (1) (g) and the amount of credit computed under
15s. 71.47 (1), (3), (4), and (5).
SB76, s. 10 16Section 10. 71.47 (5dv) of the statutes is created to read:
SB76,5,1817 71.47 (5dv) Small business guarantee fee credit. (a) In this subsection,
18"claimant" means a person who files a claim under this subsection.
SB76,5,2219 (b) Subject to the limitations provided in this subsection, a claimant may claim
20as a credit against the tax imposed under s. 71.43 an amount equal to the amount
21the claimant paid in the taxable year for a guarantee fee to obtain financing that is
22guaranteed by the federal small business administration.
SB76,5,2523 (c) No credit may be allowed under this subsection unless the claimant submits
24with the claimant's return documentation, as determined by the department of
25revenue, that the claimant paid a fee as described under par. (b).
SB76,6,2
1(d) No credit may be allowed under this subsection for any portion of the
2guarantee fee that the claimant claims as a deduction for federal tax purposes.
SB76,6,43 (e) The carry-over provisions of s. 71.28 (4) (e) and (f), as they apply to the credit
4under s. 71.28 (4), apply to the credit under this subsection.
SB76,6,125 (f) Partnerships, limited liability companies, and tax-option corporations may
6not claim the credit under this subsection, but the eligibility for, and the amount of,
7the credit are based on their payment of a fee as described under par. (b). A
8partnership, limited liability company, or tax-option corporation shall compute the
9amount of credit that each of its partners, members, or shareholders may claim and
10shall provide that information to each of them. Partners, members of limited liability
11companies, and shareholders of tax-option corporations may claim the credit in
12proportion to their ownership interests.
SB76,6,1413 (g) Section 71.28 (4) (g) and (h), as it applies to the credit under s. 71.28 (4),
14applies to the credit under this subsection.
SB76, s. 11 15Section 11. 71.49 (1) (dm) of the statutes is created to read:
SB76,6,1616 71.49 (1) (dm) The small business guarantee fee credit under s. 71.47 (5dv).
SB76, s. 12 17Section 12. 77.92 (4) of the statutes is amended to read:
SB76,7,718 77.92 (4) "Net business income", with respect to a partnership, means taxable
19income as calculated under section 703 of the Internal Revenue Code; plus the items
20of income and gain under section 702 of the Internal Revenue Code, including taxable
21state and municipal bond interest and excluding nontaxable interest income or
22dividend income from federal government obligations; minus the items of loss and
23deduction under section 702 of the Internal Revenue Code, except items that are not
24deductible under s. 71.21; plus guaranteed payments to partners under section 707
25(c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de),

1(2di), (2dj), (2dL), (2dr), (2ds), (2dx) and, (3s), and (5dv); and plus or minus, as
2appropriate, transitional adjustments, depreciation differences and basis
3differences under s. 71.05 (13), (15), (16), (17), and (19); but excluding income, gain,
4loss, and deductions from farming. "Net business income", with respect to a natural
5person, estate, or trust, means profit from a trade or business for federal income tax
6purposes and includes net income derived as an employee as defined in section 3121
7(d) (3) of the Internal Revenue Code.
SB76, s. 13 8Section 13. Initial applicability.
SB76,7,129 (1) This act first applies to taxable years beginning on January 1 of the year
10in which this subsection takes effect, except that if this subsection takes effect after
11July 31, this act first applies to taxable years beginning on January 1 of the year
12following the year in which this subsection takes effect.
SB76,7,1313 (End)
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