SB197, s. 1 1Section 1. 71.04 (4) of the statutes is renumbered 71.04 (4) (intro.) and
2amended to read:
SB197,3,143 71.04 (4) Nonresident allocation and apportionment formula. (intro.)
4Nonresident individuals and nonresident estates and trusts engaged in business
5within and without the state shall be taxed only on such income as is derived from
6business transacted and property located within the state. The amount of such
7income attributable to Wisconsin may be determined by an allocation and separate

1accounting thereof, when the business of such nonresident individual or nonresident
2estate or trust within the state is not an integral part of a unitary business, but the
3department of revenue may permit an allocation and separate accounting in any case
4in which it is satisfied that the use of such method will properly reflect the income
5taxable by this state. In all cases in which allocation and separate accounting is not
6permissible, the determination shall be made in the following manner: for all
7businesses except air carriers, financial organizations, pipeline companies, public
8utilities, railroads, sleeping car companies and car line companies there shall first
9be deducted from the total net income of the taxpayer the part thereof (less related
10expenses, if any) that follows the situs of the property or the residence of the
11recipient. The remaining net income shall be apportioned to Wisconsin this state by
12use of an apportionment fraction composed of a sales factor representing 50% of the
13fraction, a property factor representing 25% of the fraction and a payroll factor
14representing 25% of the fraction.
the following:
SB197, s. 2 15Section 2. 71.04 (4) (a) of the statutes is created to read:
SB197,3,1916 71.04 (4) (a) Except as provided in par. (f), for taxable years beginning before
17January 1, 2006, an apportionment fraction composed of a sales factor under sub. (7)
18representing 50% of the fraction, a property factor under sub. (5) representing 25%
19of the fraction, and a payroll factor under sub. (6) representing 25% of the fraction.
SB197, s. 3 20Section 3. 71.04 (4) (b) of the statutes is created to read:
SB197,3,2521 71.04 (4) (b) Except as provided in par. (f), for taxable years beginning after
22December 31, 2005, and before January 1, 2007, an apportionment fraction
23composed of a sales factor under sub. (7) representing 60% of the fraction, a property
24factor under sub. (5) representing 20% of the fraction, and a payroll factor under sub.
25(6) representing 20% of the fraction.
SB197, s. 4
1Section 4. 71.04 (4) (c) of the statutes is created to read:
SB197,4,62 71.04 (4) (c) Except as provided in par. (f), for taxable years beginning after
3December 31, 2006, and before January 1, 2008, an apportionment fraction
4composed of a sales factor under sub. (7) representing 80% of the fraction, a property
5factor under sub. (5) representing 10% of the fraction, and a payroll factor under sub.
6(6) representing 10% of the fraction.
SB197, s. 5 7Section 5. 71.04 (4) (d) of the statutes is created to read:
SB197,4,108 71.04 (4) (d) Except as provided in par. (f), for taxable years beginning after
9December 31, 2007, an apportionment fraction composed of the sales factor under
10sub. (7).
SB197, s. 6 11Section 6. 71.04 (4) (e) of the statutes is created to read:
SB197,4,1812 71.04 (4) (e) Except as provided in par. (f), for taxable years beginning after
13December 31, 2005, and before January 1, 2008, the apportionment fraction for the
14remaining net income of a financial organization shall include a sales factor that
15represents more than 50% of the apportionment fraction, as determined by rule by
16the department. For taxable years beginning after December 31, 2007, the
17apportionment fraction for the remaining net income of a financial organization is
18composed of a sales factor, as determined by rule by the department.
SB197, s. 7 19Section 7. 71.04 (4) (f) of the statutes is created to read:
SB197,5,420 71.04 (4) (f) If a taxpayer who is subject to apportionment under this subsection
21has a net gain of 100 employees in this state in any taxable year beginning after the
22effective date of this paragraph .... [revisor inserts date], and before January 1, 2008,
23the taxpayer's remaining net income may, at the taxpayer's option, be apportioned
24to this state by an apportionment fraction composed of the sales factor under sub. (7)
25or, for a financial organization, under par. (e) beginning with the taxable year in

1which the employees are hired, except that if the taxpayer does not retain such
2employees in this state for at least 3 consecutive taxable years, the taxpayer shall
3apportion the taxpayer's remaining net income as provided under pars. (a) to (e), as
4appropriate.
SB197, s. 8 5Section 8. 71.04 (4m) of the statutes is created to read:
SB197,5,106 71.04 (4m) Apportionment formula computation. (a) 1. For taxable years
7beginning before January 1, 2008, if both the numerator and the denominator of the
8sales factor under sub. (7) related to a taxpayer's remaining net income are zero, the
9sales factor under sub. (7) is eliminated from the apportionment formula to
10determine the taxpayer's remaining net income under sub. (4).
SB197,5,1411 2. For taxable years beginning after December 31, 2007, if both the numerator
12and the denominator of the sales factor under sub. (7) related to a taxpayer's
13remaining net income are zero, none of the taxpayer's remaining net income is
14apportioned to this state.
SB197,5,1915 (b) 1. For taxable years beginning before January 1, 2008, if the numerator of
16the sales factor under sub. (7) related to a taxpayer's remaining net income is a
17negative number and the denominator of the sales factor under sub. (7) related to a
18taxpayer's remaining net income is a positive number, a negative number, or zero,
19the sales factor under sub. (7) is zero.
SB197,5,2420 2. For taxable years beginning after December 31, 2007, if the numerator of the
21sales factor under sub. (7) related to a taxpayer's remaining net income is a negative
22number and the denominator of the sales factor under sub. (7) related to a taxpayer's
23remaining net income is a positive number, a negative number, or zero, none of the
24taxpayer's remaining net income is apportioned to this state.
SB197,6,5
1(c) 1. For taxable years beginning before January 1, 2008, if the numerator of
2the sales factor under sub. (7) related to a taxpayer's remaining net income is a
3positive number and the denominator of the sales factor under sub. (7) related to a
4taxpayer's remaining net income is zero or a negative number, the sales factor under
5sub. (7) is one.
SB197,6,106 2. For taxable years beginning after December 31, 2007, if the numerator of the
7sales factor under sub. (7) related to a taxpayer's remaining net income is a positive
8number and the denominator of the sales factor under sub. (7) related to a taxpayer's
9remaining net income is zero or a negative number, all of the taxpayer's remaining
10net income is apportioned to this state.
SB197, s. 9 11Section 9. 71.04 (5) (intro.) of the statutes is amended to read:
SB197,6,1312 71.04 (5) Property factor. (intro.) For purposes of sub. (4) and for taxable
13years beginning before January 1, 2008
:
SB197, s. 10 14Section 10. 71.04 (6) (intro.) of the statutes is amended to read:
SB197,6,1615 71.04 (6) Payroll factor. (intro.) For purposes of sub. (4) and for taxable years
16beginning before January 1, 2008
:
SB197, s. 11 17Section 11. 71.04 (7) (d) of the statutes is amended to read:
SB197,6,2518 71.04 (7) (d) Sales, other than sales of tangible personal property, are in this
19state if the income-producing activity is performed in this state. If the
20income-producing activity is performed both in and outside this state the sales shall
21be divided between those states having jurisdiction to tax such business in
22proportion to the direct costs of performance incurred in each such state in rendering
23this service. Services performed in states which do not have jurisdiction to tax the
24business shall be deemed to have been performed in the state to which compensation
25is allocated by sub. s. 71.04 (6) , 2001 stats.
SB197, s. 12
1Section 12. 71.04 (8) (b) of the statutes is renumbered 71.04 (8) (b) 1. and
2amended to read:
SB197,7,93 71.04 (8) (b) 1. "Public For taxable years beginning before January 1, 2006,
4"public
utility", as used in this section, means any business entity described under
5subd. 2. and
any business entity which owns or operates any plant, equipment,
6property, franchise, or license for the transmission of communications or the
7production, transmission, sale, delivery, or furnishing of electricity, water or steam,
8the rates of charges for goods or services of which have been established or approved
9by a federal, state or local government or governmental agency. " Public
SB197,7,15 102. In this section, for taxable years beginning after December 31, 2005, "public
11utility" also means any business entity providing service to the public and engaged
12in the transportation of goods and persons for hire, as defined in s. 194.01 (4),
13regardless of whether or not the entity's rates or charges for services have been
14established or approved by a federal, state or local government or governmental
15agency.
SB197, s. 13 16Section 13. 71.04 (8) (c) of the statutes is amended to read:
SB197,7,2117 71.04 (8) (c) The net business income of railroads, sleeping car companies, car
18line companies, pipeline companies, financial organizations, air carriers, and public
19utilities requiring apportionment shall be apportioned pursuant to rules of the
20department of revenue, but the income taxed is limited to the income derived from
21business transacted and property located within the state.
SB197, s. 14 22Section 14. 71.04 (10) of the statutes is amended to read:
SB197,8,823 71.04 (10) Department may waive factor. Where, in the case of any nonresident
24individual or nonresident estate or trust engaged in business within in and without
25the
outside this state of Wisconsin and required to apportion its income as provided

1in this section, it shall be shown to the satisfaction of the department of revenue that
2the use of any one of the 3 factors provided under sub. (4) gives an unreasonable or
3inequitable final average ratio because of the fact that such nonresident individual
4or nonresident estate or trust does not employ, to any appreciable extent in its trade
5or business in producing the income taxed, the factors made use of in obtaining such
6ratio, this factor may, with the approval of the department of revenue, be omitted in
7obtaining the final average ratio which is to be applied to the remaining net income.
8This subsection does not apply to taxable years beginning after December 31, 2007.
SB197, s. 15 9Section 15. 71.25 (6) of the statutes is renumbered 71.25 (6) (intro.) and
10amended to read:
SB197,9,511 71.25 (6) Allocation and separate accounting and apportionment formula.
12(intro.) Corporations engaged in business within and without the state shall be taxed
13only on such income as is derived from business transacted and property located
14within the state. The amount of such income attributable to Wisconsin may be
15determined by an allocation and separate accounting thereof, when the business of
16such corporation within the state is not an integral part of a unitary business, but
17the department of revenue may permit an allocation and separate accounting in any
18case in which it is satisfied that the use of such method will properly reflect the
19income taxable by this state. In all cases in which allocation and separate accounting
20is not permissible, the determination shall be made in the following manner: for all
21businesses except air carriers, financial organizations, pipeline companies, public
22utilities, railroads, sleeping car companies, car line companies and corporations or
23associations that are subject to a tax on unrelated business income under s. 71.26 (1)
24(a) there shall first be deducted from the total net income of the taxpayer the part
25thereof (less related expenses, if any) that follows the situs of the property or the

1residence of the recipient. The remaining net income shall be apportioned to
2Wisconsin this state by use of an apportionment fraction composed of a sales factor
3under sub. (9) representing 50% of the fraction, a property factor under sub. (7)
4representing 25% of the fraction and a payroll factor under sub. (8) representing 25%
5of the fraction.
the following:
SB197, s. 16 6Section 16. 71.25 (6) (a) of the statutes is created to read:
SB197,9,107 71.25 (6) (a) Except as provided in par. (f), for taxable years beginning before
8January 1, 2006, an apportionment fraction composed of a sales factor under sub. (9)
9representing 50% of the fraction, a property factor under sub. (7) representing 25%
10of the fraction, and a payroll factor under sub. (8) representing 25% of the fraction.
SB197, s. 17 11Section 17. 71.25 (6) (b) of the statutes is created to read:
SB197,9,1612 71.25 (6) (b) Except as provided in par. (f), for taxable years beginning after
13December 31, 2005, and before January 1, 2007, an apportionment fraction
14composed of a sales factor under sub. (9) representing 60% of the fraction, a property
15factor under sub. (7) representing 20% of the fraction, and a payroll factor under sub.
16(8) representing 20% of the fraction.
SB197, s. 18 17Section 18. 71.25 (6) (c) of the statutes is created to read:
SB197,9,2218 71.25 (6) (c) Except as provided in par. (f), for taxable years beginning after
19December 31, 2006, and before January 1, 2008, an apportionment fraction
20composed of a sales factor under sub. (9) representing 80% of the fraction, a property
21factor under sub. (7) representing 10% of the fraction, and a payroll factor under sub.
22(8) representing 10% of the fraction.
SB197, s. 19 23Section 19. 71.25 (6) (d) of the statutes is created to read:
SB197,10,3
171.25 (6) (d) Except as provided in par. (f), for taxable years beginning after
2December 31, 2007, an apportionment fraction composed of the sales factor under
3sub. (9).
SB197, s. 20 4Section 20. 71.25 (6) (e) of the statutes is created to read:
SB197,10,115 71.25 (6) (e) Except as provided in par. (f), for taxable years beginning after
6December 31, 2005, and before January 1, 2008, the apportionment fraction for the
7remaining net income of a financial organization shall include a sales factor that
8represents more than 50% of the apportionment fraction, as determined by rule by
9the department. For taxable years beginning after December 31, 2007, the
10apportionment fraction for the remaining net income of a financial organization is
11composed of a sales factor, as determined by rule by the department.
SB197, s. 21 12Section 21. 71.25 (6) (f) of the statutes is created to read:
SB197,10,2213 71.25 (6) (f) If a taxpayer who is subject to apportionment under this subsection
14has a net gain of 100 employees in this state in any taxable year beginning after the
15effective date of this paragraph .... [revisor inserts date], and before January 1, 2008,
16the taxpayer's remaining net income may, at the taxpayer's option, be apportioned
17to this state by an apportionment fraction composed of the sales factor under sub. (9)
18or, for a financial organization, under par. (e) beginning with the taxable year in
19which the employees are hired, except that if the taxpayer does not retain such
20employees in this state for at least 3 consecutive taxable years, the taxpayer shall
21apportion the taxpayer's remaining net income as provided under pars. (a) to (e), as
22appropriate.
SB197, s. 22 23Section 22. 71.25 (6m) of the statutes is created to read:
SB197,11,324 71.25 (6m) Apportionment formula computation. (a) 1. For taxable years
25beginning before January 1, 2008, if both the numerator and the denominator of the

1sales factor under sub. (9) related to a taxpayer's remaining net income are zero, the
2sales factor under sub. (9) is eliminated from the apportionment formula to
3determine the taxpayer's remaining net income under sub. (6).
SB197,11,74 2. For taxable years beginning after December 31, 2007, if both the numerator
5and the denominator of the sales factor under sub. (9) related to a taxpayer's
6remaining net income are zero, none of the taxpayer's remaining net income is
7apportioned to this state.
SB197,11,128 (b) 1. For taxable years beginning before January 1, 2008, if the numerator of
9the sales factor under sub. (9) related to a taxpayer's remaining net income is a
10negative number and the denominator of the sales factor under sub. (9) related to a
11taxpayer's remaining net income is a positive number, a negative number, or zero,
12the sales factor under sub. (9) is zero.
SB197,11,1713 2. For taxable years beginning after December 31, 2007, if the numerator of the
14sales factor under sub. (9) related to a taxpayer's remaining net income is a negative
15number and the denominator of the sales factor under sub. (9) related to a taxpayer's
16remaining net income is a positive number, a negative number, or zero, none of the
17taxpayer's remaining net income is apportioned to this state.
SB197,11,2218 (c) 1. For taxable years beginning before January 1, 2008, if the numerator of
19the sales factor under sub. (9) related to a taxpayer's remaining net income is a
20positive number and the denominator of the sales factor under sub. (9) related to a
21taxpayer's remaining net income is zero or a negative number, the sales factor under
22sub. (9) is one.
SB197,12,223 2. For taxable years beginning after December 31, 2007, if the numerator of the
24sales factor under sub. (9) related to a taxpayer's remaining net income is a positive
25number and the denominator of the sales factor under sub. (9) related to a taxpayer's

1remaining net income is zero or a negative number, all of the taxpayer's remaining
2net income is apportioned to this state.
SB197, s. 23 3Section 23. 71.25 (7) (intro.) of the statutes is amended to read:
SB197,12,54 71.25 (7) Property factor. (intro.) For purposes of sub. (5) (6) and for taxable
5years beginning before January 1, 2008
:
SB197, s. 24 6Section 24. 71.25 (8) (intro.) of the statutes is amended to read:
SB197,12,87 71.25 (8) Payroll factor. (intro.) For purposes of sub. (5) (6) and for taxable
8years beginning before January 1, 2008
:
SB197, s. 25 9Section 25. 71.25 (9) (d) of the statutes is amended to read:
SB197,12,1710 71.25 (9) (d) Sales, other than sales of tangible personal property, are in this
11state if the income-producing activity is performed in this state. If the
12income-producing activity is performed both in and outside this state the sales shall
13be divided between those states having jurisdiction to tax such business in
14proportion to the direct costs of performance incurred in each such state in rendering
15this service. Services performed in states which do not have jurisdiction to tax the
16business shall be deemed to have been performed in the state to which compensation
17is allocated by sub. s. 71.25 (8) , 2001 stats.
SB197, s. 26 18Section 26. 71.25 (10) (b) of the statutes is renumbered 71.25 (10) (b) 1. and
19amended to read:
SB197,13,220 71.25 (10) (b) 1. In this section, for taxable years beginning before January 1,
212006,
"public utility" means any business entity described under subd. 2. and any
22business entity which owns or operates any plant, equipment, property, franchise,
23or license for the transmission of communications or the production, transmission,
24sale, delivery, or furnishing of electricity, water or steam the rates of charges for

1goods or services of which have been established or approved by a federal, state or
2local government or governmental agency. "Public
SB197,13,8 32. In this section, for taxable years beginning after December 31, 2005, "public
4utility" also means any business entity providing service to the public and engaged
5in the transportation of goods and persons for hire, as defined in s. 194.01 (4),
6regardless of whether or not the entity's rates or charges for services have been
7established or approved by a federal, state or local government or governmental
8agency.
SB197, s. 27 9Section 27. 71.25 (10) (c) of the statutes is amended to read:
SB197,13,1410 71.25 (10) (c) The net business income of railroads, sleeping car companies, car
11line companies, pipeline companies, financial organizations, air carriers, and public
12utilities requiring apportionment shall be apportioned pursuant to rules of the
13department of revenue, but the income taxed is limited to the income derived from
14business transacted and property located within the state.
SB197, s. 28 15Section 28. 71.25 (11) of the statutes is amended to read:
SB197,14,216 71.25 (11) Department may waive factor. Where, in the case of any corporation
17engaged in business within in and without the outside this state of Wisconsin and
18required to apportion its income as provided in sub. (6), it shall be shown to the
19satisfaction of the department of revenue that the use of any one of the 3 factors
20provided in sub. (6) gives an unreasonable or inequitable final average ratio because
21of the fact that such corporation does not employ, to any appreciable extent in its
22trade or business in producing the income taxed, the factors made use of in obtaining
23such ratio, this factor may, with the approval of the department of revenue, be
24omitted in obtaining the final average ratio which is to be applied to the remaining

1net income. This subsection does not apply to taxable years beginning after
2December 31, 2007.
SB197, s. 29 3Section 29. 71.45 (3) (intro.) of the statutes is amended to read:
SB197,14,124 71.45 (3) Apportionment. (intro.) With respect Except as provided in sub. (3d),
5to determine Wisconsin income for purposes of the franchise tax, domestic insurers
6not engaged in the sale of life insurance but which that, in the taxable year, have
7collected received premiums, other than life insurance premiums, written on
8subjects of
for insurance on property or risks resident, located or to be performed
9outside this state, there shall be subtracted from multiply the net income figure
10derived by application of sub. (2) (a) to arrive at Wisconsin income constituting the
11measure of the franchise tax an amount calculated by multiplying such adjusted
12federal taxable income
by the arithmetic average of the following 2 percentages:
SB197, s. 30 13Section 30. 71.45 (3) (a) of the statutes is amended to read:
SB197,15,414 71.45 (3) (a) The Subject to sub. (3d), the percentage of total determined by
15dividing the sum of direct
premiums written on all property and risks for insurance
16other than life insurance, with respect to all property and risks resident, located, or
17to be performed in this state, and assumed premiums written for reinsurance, other
18than life insurance, with respect to all property and risks resident, located, or to be
19performed in this state, by the sum of direct premiums written for insurance on all
20property and risks, other than life insurance,
wherever located during the taxable
21year, as reflects
, and assumed premiums written on insurance for reinsurance on all
22property and risks
, other than life insurance, where the subject of insurance was
23resident, located or to be performed outside this state
wherever located. In this
24paragraph, "direct premiums" means direct premiums as reported for the taxable
25year on an annual statement that is filed by the insurer with the commissioner of

1insurance under s. 601.42 (1g) (a). In this paragraph, "assumed premiums" means
2assumed reinsurance premiums from domestic insurance companies as reported for
3the taxable year on an annual statement that is filed with the commissioner of
4insurance under s. 601.42 (1g) (a)
.
SB197, s. 31 5Section 31. 71.45 (3) (b) of the statutes is renumbered 71.45 (3) (b) 1. and
6amended to read:
SB197,15,117 71.45 (3) (b) 1. The Subject to sub. (3d), the percentage of determined by
8dividing the payroll, exclusive of life insurance payroll, paid in this state in the
9taxable year by
total payroll, exclusive of life insurance payroll, paid everywhere in
10the taxable year as reflects such compensation paid outside this state.
11Compensation
.
SB197,15,20 122. Under subd. 1., payroll is paid outside in this state if the individual's service
13is performed entirely outside in this state; or the individual's service is performed
14both within and without in and outside this state, but the service performed within
15outside this state is incidental to the individual's service without in this state; or
16some service is performed without in this state and the base of operations, or if there
17is no base of operations, the place from which the service is directed or controlled is
18without in this state, or the base of operations or the place from which the service is
19directed or controlled is not in any state in which some part of the service is
20performed, but the individual's residence is outside in this state.
SB197, s. 32 21Section 32. 71.45 (3d) of the statutes is created to read:
SB197,16,322 71.45 (3d) Phase in; domestic insurers. (a) Except as provided in par. (d), for
23taxable years beginning after December 31, 2005, and before January 1, 2007, a
24domestic insurer that is subject to apportionment under sub. (3) and this subsection
25shall multiply the net income figure derived by the application of sub. (2) by an

1apportionment fraction composed of the percentage under sub. (3) (a) representing
260% of the fraction and the percentage under sub. (3) (b) 1. representing 40% of the
3fraction.
SB197,16,94 (b) Except as provided in par. (d), for taxable years beginning after December
531, 2006, and before January 1, 2008, a domestic insurer that is subject to
6apportionment under sub. (3) and this subsection shall multiply the net income
7figure derived by the application of sub. (2) by an apportionment fraction composed
8of the percentage under sub. (3) (a) representing 80% of the fraction and the
9percentage under sub. (3) (b) 1. representing 20% of the fraction.
SB197,16,1310 (c) Except as provided in par. (d), for taxable years beginning after December
1131, 2007, a domestic insurer that is subject to apportionment under sub. (3) and this
12subsection shall multiply the net income figure derived by the application of sub. (2)
13by the percentage under sub. (3) (a).
SB197,16,2214 (d) If a taxpayer who is subject to apportionment under sub. (3) has a net gain
15of 100 employees in this state in any taxable year beginning after the effective date
16of this paragraph .... [revisor inserts date], and before January 1, 2008, the
17taxpayer's remaining net income may, at the taxpayer's option, be apportioned to this
18state by an apportionment fraction composed of the percentage under sub. (3) (a)
19beginning with the taxable year in which the employees are hired, except that if the
20taxpayer does not retain such employees in this state for at least 3 consecutive
21taxable years, the taxpayer shall apportion the taxpayer's remaining net income as
22provided under pars. (a) to (c), as appropriate.
SB197, s. 33 23Section 33. 71.45 (3e) of the statutes is created to read:
SB197,17,324 71.45 (3e) Apportionment formula computation. (a) 1. For taxable years
25beginning before January 1, 2008, if both the numerator and the denominator used

1to determine the percentage under sub. (3) (a) related to a taxpayer's net income are
2zero, the percentage under sub. (3) (a) is eliminated from the apportionment formula
3to determine the taxpayer's income under sub. (3).
SB197,17,74 2. For taxable years beginning after December 31, 2007, if both the numerator
5and the denominator used to determine the percentage under sub. (3) (a) related to
6a taxpayer's net income are zero, none of the taxpayer's net income is apportioned
7to this state.
SB197,17,128 (b) 1. For taxable years beginning before January 1, 2008, if the numerator
9used to determine the percentage under sub. (3) (a) related to a taxpayer's net income
10is a negative number and the denominator used to determine the percentage under
11sub. (3) (a) related to a taxpayer's net income is a positive number, a negative number,
12or zero, the percentage under sub. (3) (a) is zero.
SB197,17,1713 2. For taxable years beginning after December 31, 2007, if the numerator used
14to determine the percentage under sub. (3) (a) related to a taxpayer's net income is
15a negative number and the denominator used to determine the percentage under
16sub. (3) (a) related to a taxpayer's net income is a positive number, a negative number,
17or zero, none of the taxpayer's net income is apportioned to this state.
SB197,17,2218 (c) 1. For taxable years beginning before January 1, 2008, if the numerator used
19to determine the percentage under sub. (3) (a) related to a taxpayer's net income is
20a positive number and the denominator used to determine the percentage under sub.
21(3) (a) related to a taxpayer's net income is zero or a negative number, the percentage
22under sub. (3) (a) is one.
SB197,18,223 2. For taxable years beginning after December 31, 2007, if the numerator used
24to determine the percentage under sub. (3) (a) related to a taxpayer's net income is
25a positive number and the denominator used to determine the percentage under sub.

1(3) (a) related to a taxpayer's net income is zero or a negative number, all of the
2taxpayer's net income is apportioned to this state.
SB197, s. 34 3Section 34. 71.45 (3m) of the statutes is amended to read:
SB197,18,114 71.45 (3m) Arithmetic average. The Except as provided in sub. (3d), the
5arithmetic average of the 2 percentages referred to in sub. (3) shall be applied to the
6net income figure arrived at by the successive application of sub. (2) (a) and (b) with
7respect to Wisconsin insurers to which sub. (2) (a) and (b) applies and which have
8collected received premiums, other than life insurance premiums, written upon for
9insurance, other than life insurance, where the subject of such insurance was on
10property or risks
resident, located or to be performed outside this state, to arrive at
11Wisconsin income constituting the measure of the franchise tax.
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