Under the bill, the definition of "income" for homestead credit purposes, as it
applies to certain pensions and annuities, is modified such that nontaxable
recoveries of a claimant's investment in a pension or annuity is excluded from the
definition of "income" and only the taxable portion of the pension or annuity is
included.
AB140,3,164
71.52
(6) "Income" means the sum of Wisconsin adjusted gross income and the
5following amounts, to the extent not included in Wisconsin adjusted gross income:
1maintenance payments (except foster care maintenance and supplementary
2payments excludable under section
131 of the
internal revenue code Internal
3Revenue Code), support money, cash public assistance (not including credit granted
4under this subchapter and amounts under s. 46.27), cash benefits paid by counties
5under s. 59.53 (21),
retirement benefits excludable under s. 71.05 (1) (a), the gross
6amount of
any pension or annuity (including railroad retirement benefits
and
7veterans disability pensions, all payments received under the federal social security
8act
and veterans disability pensions), nontaxable interest received from the federal
9government or any of its instrumentalities, nontaxable interest received on state or
10municipal bonds, worker's compensation, unemployment insurance, the gross
11amount of "loss of time" insurance, compensation and other cash benefits received
12from the United States for past or present service in the armed forces, scholarship
13and fellowship gifts or income, capital gains, gain on the sale of a personal residence
14excluded under section
121 of the
internal revenue code Internal Revenue Code,
15dividends, income of a nonresident or part-year resident who is married to a
16full-year resident, housing allowances provided to members of the clergy, the
17amount by which a resident manager's rent is reduced, nontaxable income of an
18American Indian, nontaxable income from sources outside this state
and nontaxable
19deferred compensation, life insurance proceeds received on account of the death of
20the insured, and compensation for injuries or sickness excluded under section 104
21of the Internal Revenue Code. Intangible drilling costs, depletion allowances and
22depreciation, including first-year depreciation allowances under section
179 of the
23internal revenue code Internal Revenue Code, amortization,
contributions to
24individual retirement accounts under section 219 of the internal revenue code,
25contributions to Keogh plans, net operating loss carry-forwards and capital loss
1carry-forwards deducted in determining Wisconsin adjusted gross income shall be
2added to "income". "Income" does not include gifts from natural persons, cash
3reimbursement payments made under title XX of the federal social security act,
4surplus food or other relief in kind supplied by a governmental agency, the gain on
5the sale of a personal residence deferred under section
1034 of the
internal revenue
6code Internal Revenue Code or nonrecognized gain from involuntary conversions
7under section
1033 of the
internal revenue code Internal Revenue Code. Amounts
8not included in adjusted gross income but added to "income" under this subsection
9in a previous year and repaid may be subtracted from income for the year during
10which they are repaid. Scholarship and fellowship gifts or income that are included
11in Wisconsin adjusted gross income and that were added to household income for
12purposes of determining the credit under this subchapter in a previous year may be
13subtracted from income for the current year in determining the credit under this
14subchapter. A marital property agreement or unilateral statement under ch. 766 has
15no effect in computing "income" for a person whose homestead is not the same as the
16homestead of that person's spouse.
AB140,3,2118
(1) This act first applies to taxable years beginning on January 1 of the year
19in which this subsection takes effect, except that if this subsection takes effect after
20July 31 this act first applies to taxable years beginning on January 1 of the year
21following the year in which this subsection takes effect.