AB635,9,83 2. If a credit computed under this subsection is not entirely offset against
4Wisconsin income or franchise taxes otherwise due, the unused balance may be
5carried forward and credited against Wisconsin income or franchise taxes otherwise
6due for the following 10 taxable years to the extent not offset by these taxes otherwise
7due in all intervening years between the year in which the expense was incurred and
8the year in which the carry-forward credit is claimed.
AB635, s. 7 9Section 7. 71.30 (3) (er) of the statutes is created to read:
AB635,9,1010 71.30 (3) (er) Nanotechnology credit under s. 71.28 (5m).
AB635, s. 8 11Section 8. 71.34 (1) (g) of the statutes, as affected by 2007 Wisconsin Act 20,
12is amended to read:
AB635,9,1613 71.34 (1) (g) An addition shall be made for credits computed by a tax-option
14corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (3), (3g),
15(3h), (3n), (3p), (3t), (3w), (5e), (5f), (5g), (5h), (5i), (5j), and (5k), and (5m) and passed
16through to shareholders.
AB635, s. 9 17Section 9. 71.45 (2) (a) 10. of the statutes, as affected by 2007 Wisconsin Act
1820
, is amended to read:
AB635,9,2519 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
20computed under s. 71.47 (1dd) to (1dx), (3h), (3n), (3p), (3w), (5e), (5f), (5g), (5h), (5i),
21(5j), and (5k), and (5m) and not passed through by a partnership, limited liability
22company, or tax-option corporation that has added that amount to the partnership's,
23limited liability company's, or tax-option corporation's income under s. 71.21 (4) or
2471.34 (1) (g) and the amount of credit computed under s. 71.47 (1), (3), (3t), (4), and
25(5).
AB635, s. 10
1Section 10. 71.47 (5i) of the statutes is created to read:
AB635,10,22 71.47 (5i) Nanotechnology credit. (a) Definitions. In this subsection:
AB635,10,33 1. "Claimant" means a person who files a claim under this subsection.
AB635,10,64 2. "Consortium" means 2 or more public institutions of higher education that
5are conducting substantially similar qualified research or working on components
6of the same qualified research.
AB635,10,77 3. "Manufacturing" has the meaning given in s. 77.54 (6m).
AB635,10,108 4. "Nanotechnology" means the science and technology that enables a person
9to understand, measure, manipulate, and manufacture materials at the atomic,
10molecular, and supermolecular levels.
AB635,10,1611 5. "Nanotechnology business" means a business, as certified by the department
12of commerce in the manner prescribed by the department of commerce, that is
13primarily engaged in applying nanotechnologies to create new applications or
14processes, or modify existing applications or processes, in order to make useful
15processes and products related to health care, energy, food production,
16manufacturing, biotechnology, information technology, or the environment.
AB635,10,2217 6. "Qualified research" means qualified research as defined under section 41
18(d) (1) of the Internal Revenue Code, except that research conducted by a public or
19private institution of higher education or a consortium, or a combination thereof, is
20"qualified research" if the research is intended to be useful in developing a new or
21improved product or service and the research satisfies section 41 (d) (1) (B) (i) and
22(C) of the Internal Revenue Code.
AB635,10,2423 7. "Used exclusively" means used to the exclusion of all other uses except for
24use not exceeding 5 percent of total use.
AB635,11,4
1(b) Filing claims. Subject to the limitations provided in this subsection and s.
2560.207, for taxable years beginning on or after July 1, 2008, a claimant may claim
3as a credit against the taxes imposed under s. 71.43, up to the amount of the taxes,
4any of the following amounts that the claimant paid in the taxable year:
AB635,11,95 1. The taxes imposed under subch. III of ch. 77 on the purchase of machines and
6processing equipment, including accessories, attachments, and parts for the
7machines or equipment, that are used exclusively and directly by the claimant in the
8claimant's nanotechnology business for qualified research and manufacturing, if the
9research and manufacturing occurs in this state.
AB635,11,1310 2. Payments to a public or private institution of higher education, or to a
11consortium, for research, equipment, or the use of research facilities, or other
12qualified expenses as determined by the department of commerce, that are directly
13related to nanotechnology.
AB635,11,1614 3. The taxes imposed under subch. III of ch. 77 on the purchase of any of the
15following that are used by the claimant's nanotechnology business for research and
16development that occurs in this state:
AB635,11,1717 a. Advanced computing devices, including computer hardware and software.
AB635,11,1818 b. Data communications.
AB635,11,1919 c. Information technology.
AB635,11,2120 d. Laboratory materials used exclusively for nanotechnology research and
21development.
AB635,11,2422 (c) Limitations. 1. The maximum amount of the credits that may be allocated
23to all claimants under this subsection and ss. 71.07 (5m) and 71.28 (5m) in each fiscal
24year is $2,500,000, as determined by the department of commerce under s. 560.207.
AB635,12,3
12. No credit may be allowed under this subsection unless the claimant submits
2with the claimant's return a copy of the claimant's certification for and allocation of
3credits under s. 560.207.
AB635,12,114 3. Partnerships, limited liability companies, and tax-option corporations may
5not claim the credit under this subsection, but the eligibility for, and the amount of,
6the credit are based on their payment of amounts under par. (b). A partnership,
7limited liability company, or tax-option corporation shall compute the amount of
8credit that each of its partners, members, or shareholders may claim and shall
9provide that information to each of them. Partners, members of limited liability
10companies, and shareholders of tax-option corporations may claim the credit in
11proportion to their ownership interests.
AB635,12,1312 (d) Administration. 1. Section 71.28 (4) (e), (g), and (h), as it applies to the
13credit under s. 71.28 (4), applies to the credit under this subsection.
AB635,12,1914 2. If a credit computed under this subsection is not entirely offset against
15Wisconsin income or franchise taxes otherwise due, the unused balance may be
16carried forward and credited against Wisconsin income or franchise taxes otherwise
17due for the following 10 taxable years to the extent not offset by these taxes otherwise
18due in all intervening years between the year in which the expense was incurred and
19the year in which the carry-forward credit is claimed.
AB635, s. 11 20Section 11. 71.49 (1) (er) of the statutes is created to read:
AB635,12,2121 71.49 (1) (er) Nanotechnology credit under s. 71.47 (5i).
AB635, s. 12 22Section 12. 77.92 (4) of the statutes, as affected by 2007 Wisconsin Act 20, is
23amended to read:
AB635,13,1424 77.92 (4) "Net business income," with respect to a partnership, means taxable
25income as calculated under section 703 of the Internal Revenue Code; plus the items

1of income and gain under section 702 of the Internal Revenue Code, including taxable
2state and municipal bond interest and excluding nontaxable interest income or
3dividend income from federal government obligations; minus the items of loss and
4deduction under section 702 of the Internal Revenue Code, except items that are not
5deductible under s. 71.21; plus guaranteed payments to partners under section 707
6(c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de),
7(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g), (3h), (3s), (3n), (3p), (3t), (3w), (5e),
8(5f), (5g), (5h), (5i), (5j), and (5k), and (5m); and plus or minus, as appropriate,
9transitional adjustments, depreciation differences, and basis differences under s.
1071.05 (13), (15), (16), (17), and (19); but excluding income, gain, loss, and deductions
11from farming. "Net business income," with respect to a natural person, estate, or
12trust, means profit from a trade or business for federal income tax purposes and
13includes net income derived as an employee as defined in section 3121 (d) (3) of the
14Internal Revenue Code.
AB635, s. 13 15Section 13. 560.207 of the statutes is created to read:
AB635,13,18 16560.207 Nanotechnology tax credits. (1) The department shall implement
17a program for certifying businesses as eligible for tax credits under ss. 71.07 (5m),
1871.28 (5m), and 71.47 (5m).
AB635,13,24 19(2) If the department certifies a business as eligible under sub. (1), the
20department shall determine the amount of expenditures by the business that meet
21the requirements of s. 71.07 (5m) (b) 1. to 3., 71.28 (5m) (b) 1. to 3., or 71.47 (5m) (b)
221. to 3. and shall determine the amount of tax credits to be allocated to the business.
23The total amount of tax credits allocated to all eligible businesses may not exceed
24$2,500,000 per fiscal year.
AB635,14,3
1(3) The department of commerce shall notify the department of revenue of
2every business certified under sub. (1) and the amount of tax credits allocated to the
3business under sub. (2).
AB635, s. 14 4Section 14. Nonstatutory provisions.
AB635,14,165 (1) Notwithstanding section 227.24 of the statutes, the department of
6commerce may promulgate emergency rules necessary to administer section 560.207
7of the statutes, as created by this act. Notwithstanding section 227.24 (1) (c) and (2)
8of the statutes, emergency rules promulgated under this subsection remain in effect
9until the effective date of permanent rules promulgated to administer section
10560.207 of the statutes, as created by this act, or the first day of the 13th month after
11the effective date of this subsection, whichever is sooner. Notwithstanding section
12227.24 (1) (a) and (3) of the statutes, the department of commerce is not required to
13provide evidence that promulgating a rule under this subsection as an emergency
14rule is necessary for the preservation of the public peace, health, safety, or welfare
15and is not required to provide a finding of emergency for a rule promulgated under
16this subsection.
AB635,14,1717 (End)
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