RJM&JK:kjf:jf
2003 - 2004 LEGISLATURE
SENATE SUBSTITUTE AMENDMENT 1,
TO 2003 SENATE BILL 249
November 12, 2003 - Offered by
Joint Committee on Finance.
SB249-SSA1,2,10
1An Act to repeal 560.30 (10) (c) and 560.37 (3m) (a) 1.;
to renumber 560.32 (2)
2(c);
to renumber and amend 76.635 (2), 560.30 (9), 560.31 (1), 560.32 (2) (b),
3560.32 (3), 560.33 (1) (b), 560.33 (2), 560.34 (1) (d), 560.34 (1m) (a) 2., 560.34 (2),
4560.36 (intro.) and 560.36 (1) to (4);
to consolidate, renumber and amend
5560.37 (3m) (a) (intro.) and 2.;
to amend 71.05 (6) (a) 15., 71.21 (4), 71.26 (2)
6(a), 71.34 (1) (g), 71.45 (2) (a) 10., 77.92 (4), subchapter II (title) of chapter
7[precedes 560.30], 560.30 (3), 560.30 (10) (intro.), 560.30 (10) (a), 560.30 (10) (b),
8560.30 (10) (d), 560.31 (2) (intro.), 560.31 (2) (b), 560.32 (2) (d), 560.33 (1)
9(intro.), 560.33 (1) (a), 560.33 (1) (e), 560.33 (1) (g), 560.34 (1) (intro.), 560.34 (1)
10(a) 1., 560.34 (1) (a) 2. a., 560.34 (1) (a) 2. b., 560.34 (1) (b), 560.34 (1) (c), 560.34
11(1) (e), 560.34 (1m) (b), 560.34 (4), 560.35 (2) (intro.), 560.35 (2) (a), 560.35 (2)
12(c), 560.35 (3), 560.37 (4) and 560.37 (5); and
to create 71.07 (7m), 71.10 (4) (cp),
1371.28 (7m), 71.30 (3) (dm), 71.47 (7), 71.47 (7m), 71.49 (1) (dm), 71.49 (1) (dn),
176.635 (2) (b), 560.30 (5g), 560.30 (5r), 560.30 (9) (d), 560.30 (10) (e), 560.31 (2)
2(g), 560.31 (2) (h), 560.31 (2) (i), 560.31 (2) (j), 560.31 (2) (k), 560.32 (2) (b) 2.,
3560.32 (2) (c) 2., 560.32 (3) (b), 560.33 (1) (b) 2., 560.33 (1) (h), 560.33 (1) (i),
4560.33 (1) (j), 560.33 (1) (k), 560.33 (2) (b) and (c), 560.34 (1) (d) 2., 560.34 (1)
5(f), 560.34 (1e), 560.34 (1g), 560.34 (1m) (a) 2. b., 560.34 (2) (a) to (k), 560.34 (5),
6560.35 (1c), 560.35 (1r), 560.35 (2) (d), 560.36 (2m) and 560.37 (1m) of the
7statutes;
relating to: certified capital companies, creating a certified capital
8company income and franchise tax credit, requesting a performance audit,
9providing an exemption from emergency rule procedures, and requiring the
10exercise of rule-making authority.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB249-SSA1, s. 1
11Section
1. 71.05 (6) (a) 15. of the statutes is amended to read:
SB249-SSA1,2,1612
71.05
(6) (a) 15. The amount of the credits computed under s. 71.07 (2dd), (2de),
13(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g),
and (3s)
, and (7m) and not passed
14through by a partnership, limited liability company, or tax-option corporation that
15has added that amount to the partnership's, company's, or tax-option corporation's
16income under s. 71.21 (4) or 71.34 (1) (g).
SB249-SSA1,2,1818
71.07
(7m) Certified capital company credit. (a) In this subsection:
SB249-SSA1,2,1919
1. "Certified capital company" has the meaning given in s. 560.30 (2).
SB249-SSA1,2,2020
2. "Certified capital investment" has the meaning given in s. 560.30 (4).
SB249-SSA1,3,221
3. "Claimant" means a person who is subject to taxation under subchs. I, II, and
22IV of ch. 76, a credit union organized under ch. 186, a savings bank organized under
1ch. 214, a savings and loan association organized under ch. 215, or a bank organized
2under ch. 221.
SB249-SSA1,3,33
4. "Investment date" has the meaning given in s. 560.30 (6).
SB249-SSA1,3,44
5. "Investment pool" has the meaning given in s. 560.30 (7).
SB249-SSA1,3,55
6. "Qualified investment" has the meaning given in s. 560.30 (11).
SB249-SSA1,3,146
(b) A claimant who makes a certified capital investment of at least $1,000,000
7may claim as a credit against the tax imposed under ss. 71.02 and 71.08, up to the
8amount of those taxes, for 10 years beginning with the year of the investment, an
9amount equal to either 7.5 percent of that investment for the first 2 taxable years and
1010.625 percent of that investment for the remaining 8 taxable years or the amount
11by which the sum of the claimant's certified capital investments and the claimant's
12qualified investments exceeds the claimant's qualified investments in the taxable
13year before the claimant first claimed the credit under this subsection, whichever is
14less.
SB249-SSA1,3,1615
(c) Subsection 71.28 (4) (e), (f), (g), and (h), as it applies to the credit under 71.28
16(4), applies to the credit under this subsection.
SB249-SSA1,3,2417
(d) 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 certified capital investment. 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 interest.
SB249-SSA1,4,6
1(e) 1. If a certified capital company is decertified, or an investment pool is
2disqualified, under s. 560.37 before the certified capital company fulfills the
3investment requirement under s. 560.34 (1m) (a) 1. with respect to the investment
4pool, any claimant that has received a credit under this subsection with respect to
5that investment pool shall repay that credit to the department of revenue and may
6not claim more credit in respect to that investment pool.
SB249-SSA1,4,167
2. If a certified capital company fulfills the investment requirement under s.
8560.34 (1m) (a) 1. with respect to an investment pool but the certified capital
9company is decertified, or an investment pool is disqualified, under s. 560.37 before
10the certified capital company fulfills the investment requirement under s. 560.34
11(1m) (a) 2. for that investment pool, any claimant that has received a credit under
12this subsection with respect to that investment pool shall repay all credits that were
13claimed for taxable years after the taxable year that includes the 3rd anniversary of
14the investment date of the investment pool and may claim no more credits for taxable
15years after the taxable year that includes the 3rd anniversary of the investment date
16of the investment pool.
SB249-SSA1, s. 3
17Section
3. 71.10 (4) (cp) of the statutes is created to read:
SB249-SSA1,4,1818
71.10
(4) (cp) The certified capital company credit under s. 71.07 (7m).
SB249-SSA1,4,2220
71.21
(4) Credits computed by a partnership under s. 71.07 (2dd), (2de), (2di),
21(2dj), (2dL), (2dm), (2ds), (2dx), (3g),
and (3s)
, and (7m) and passed through to
22partners shall be added to the partnership's income.
SB249-SSA1,5,1324
71.26
(2) (a)
Corporations in general. The "net income" of a corporation means
25the gross income as computed under the Internal Revenue Code as modified under
1sub. (3) minus the amount of recapture under s. 71.28 (1di) plus the amount of credit
2computed under s. 71.28 (1), (3), (4), and (5) plus the amount of the credit computed
3under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx),
and (3g)
, and (7m) 4and not passed through by a partnership, limited liability company, or tax-option
5corporation that has added that amount to the partnership's, limited liability
6company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) plus
7the amount of losses from the sale or other disposition of assets the gain from which
8would be wholly exempt income, as defined in sub. (3) (L), if the assets were sold or
9otherwise disposed of at a gain and minus deductions, as computed under the
10Internal Revenue Code as modified under sub. (3), plus or minus, as appropriate, an
11amount equal to the difference between the federal basis and Wisconsin basis of any
12asset sold, exchanged, abandoned, or otherwise disposed of in a taxable transaction
13during the taxable year, except as provided in par. (b) and s. 71.45 (2) and (5).
SB249-SSA1,5,1515
71.28
(7m) Certified capital company credit. (a) In this subsection:
SB249-SSA1,5,1616
1. "Certified capital company" has the meaning given in s. 560.30 (2).
SB249-SSA1,5,1717
2. "Certified capital investment" has the meaning given in s. 560.30 (4).
SB249-SSA1,5,2118
3. "Claimant" means a person who is subject to taxation under subchs. I, II, and
19IV of ch. 76, a credit union organized under ch. 186, a savings bank organized under
20ch. 214, a savings and loan association organized under ch. 215, or a bank organized
21under ch. 221.
SB249-SSA1,5,2222
4. "Investment date" has the meaning given in s. 560.30 (6).
SB249-SSA1,5,2323
5. "Investment pool" has the meaning given in s. 560.30 (7).
SB249-SSA1,5,2424
6. "Qualified investment" has the meaning given in s. 560.30 (11).
SB249-SSA1,6,8
1(b) A claimant who makes a certified capital investment of at least $1,000,000
2may claim as a credit against the tax imposed under s. 71.23, up to the amount of
3those taxes, for 10 years beginning with the year of the investment, an amount equal
4to either 7.5 percent of that investment for the first 2 taxable years and 10.625
5percent of that investment for the remaining 8 taxable years or the amount by which
6the sum of the claimant's certified capital investments and the claimant's qualified
7investments exceeds the claimant's qualified investments in the taxable year before
8the claimant first claimed the credit under this subsection, whichever is less.
SB249-SSA1,6,109
(c) Subsection (4) (e), (f), (g), and (h), as it applies to the credit under sub. (4),
10applies to the credit under this subsection.
SB249-SSA1,6,1811
(d) Partnerships, limited liability companies, and tax-option corporations may
12not claim the credit under this subsection, but the eligibility for, and the amount of,
13the credit are based on their payment of a certified capital investment. A
14partnership, limited liability company, or tax-option corporation shall compute the
15amount of credit that each of its partners, members, or shareholders may claim and
16shall provide that information to each of them. Partners, members of limited liability
17companies, and shareholders of tax-option corporations may claim the credit in
18proportion to their ownership interest.
SB249-SSA1,6,2419
(e) 1. If a certified capital company is decertified, or an investment pool is
20disqualified, under s. 560.37 before the certified capital company fulfills the
21investment requirement under s. 560.34 (1m) (a) 1. with respect to the investment
22pool, any claimant that has received a credit under this subsection with respect to
23that investment pool shall repay that credit to the department of revenue and may
24not claim more credit in respect to that investment pool.
SB249-SSA1,7,10
12. If a certified capital company fulfills the investment requirement under s.
2560.34 (1m) (a) 1. with respect to an investment pool but the certified capital
3company is decertified, or an investment pool is disqualified, under s. 560.37 before
4the certified capital company fulfills the investment requirement under s. 560.34
5(1m) (a) 2. for that investment pool, any claimant that has received a credit under
6this subsection with respect to that investment pool shall repay all credits that were
7claimed for taxable years after the taxable year that includes the 3rd anniversary of
8the investment date of the investment pool and may claim no more credits for taxable
9years after the taxable year that includes the 3rd anniversary of the investment date
10of the investment pool.
SB249-SSA1, s. 7
11Section
7. 71.30 (3) (dm) of the statutes is created to read:
SB249-SSA1,7,1212
71.30
(3) (dm) The certified capital company credit under s. 71.28 (7m).
SB249-SSA1,7,1614
71.34
(1) (g) An addition shall be made for credits computed by a tax-option
15corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (3),
and 16(3g)
, and (7m) and passed through to shareholders.
SB249-SSA1, s. 9
17Section
9. 71.45 (2) (a) 10. of the statutes is amended to read:
SB249-SSA1,7,2318
71.45
(2) (a) 10. By adding to federal taxable income the amount of credit
19computed under s. 71.47 (1dd) to (1dx)
, (7) and (7m) and not passed through by a
20partnership, limited liability company
, or tax-option corporation that has added that
21amount to the partnership's, limited liability company's
, or tax-option corporation's
22income under s. 71.21 (4) or 71.34 (1) (g) and the amount of credit computed under
23s. 71.47 (1), (3), (4)
, and (5).
SB249-SSA1,7,2525
71.47
(7) Certified capital company credit. (a) In this subsection:
SB249-SSA1,8,1
11. "Certified capital company" has the meaning given in s. 560.30 (2).
SB249-SSA1,8,22
2. "Certified capital investment" has the meaning given in s. 560.30 (4).
SB249-SSA1,8,33
3. "Investment date" has the meaning given in s. 560.30 (6).
SB249-SSA1,8,44
4. "Investment pool" has the meaning given in s. 560.30 (7).
SB249-SSA1,8,55
5. "Qualified investment" has the meaning given in s. 560.30 (11).
SB249-SSA1,8,136
(b) An insurer who makes a certified capital investment of at least $1,000,000
7may claim as a credit against the tax imposed under s. 71.43, for 10 years beginning
8with the year of the investment, an amount equal to either 7.5 percent of that
9investment for the first 2 taxable years and 10.625 percent of that investment for the
10remaining 8 taxable years or the amount by which the sum of the insurer's certified
11capital investments and the insurer's qualified investments exceeds the insurer's
12qualified investments in the taxable year before the insurer first claimed the credit
13under this section, whichever is less.
SB249-SSA1,8,1514
(c) Section 71.28 (4) (e), (f), (g), and (h), as it applies to the credit under s. 71.28
15(4), applies to the credit under this subsection.
SB249-SSA1,8,2116
(d) 1. If a certified capital company is decertified, or an investment pool is
17disqualified, under s. 560.37 before the certified capital company fulfills the
18investment requirement under s. 560.34 (1m) (a) 1. with respect to the investment
19pool, any insurer that has received a credit under this subsection with respect to that
20investment pool shall repay that credit to the department of revenue and may not
21claim more credit in respect to that investment pool.
SB249-SSA1,9,622
2. If a certified capital company fulfills the investment requirement under s.
23560.34 (1m) (a) 1. with respect to an investment pool but the certified capital
24company is decertified, or an investment pool is disqualified, under s. 560.37 before
25the certified capital company fulfills the investment requirement under s. 560.34
1(1m) (a) 2. for that investment pool, any insurer that has received a credit under this
2subsection with respect to that investment pool shall repay all credits that were
3claimed for taxable years after the taxable year that includes the 3rd anniversary of
4the investment date of the investment pool and may claim no more credits for taxable
5years after the taxable year that includes the 3rd anniversary of the investment date
6of the investment pool.
SB249-SSA1,9,107
(e) An insurer may sell a credit under this subsection to another insurer who
8is subject to the tax imposed under s. 71.43 if the insurer notifies the commissioner
9of insurance and the department of revenue of the sale and includes with such
10notifications copies of the transfer documents.
SB249-SSA1,9,1212
71.47
(7m) Certified capital company credit. (a) In this subsection:
SB249-SSA1,9,1313
1. "Certified capital company" has the meaning given in s. 560.30 (2).
SB249-SSA1,9,1414
2. "Certified capital investment" has the meaning given in s. 560.30 (4).
SB249-SSA1,9,1815
3. "Claimant" means a person who is subject to taxation under subchs. I, II, and
16IV of ch. 76, a credit union organized under ch. 186, a savings bank organized under
17ch. 214, a savings and loan association organized under ch. 215, or a bank organized
18under ch. 221.
SB249-SSA1,9,1919
4. "Investment date" has the meaning given in s. 560.30 (6).
SB249-SSA1,9,2020
5. "Investment pool" has the meaning given in s. 560.30 (7).
SB249-SSA1,9,2121
6. "Qualified investment" has the meaning given in s. 560.30 (11).
SB249-SSA1,9,2522
(b) A claimant who makes a certified capital investment of at least $1,000,000
23may claim as a credit against the tax imposed under s. 71.43, up to the amount of
24those taxes, for 10 years beginning with the year of the investment, an amount equal
25to either 7.5 percent of that investment for the first 2 taxable years and 10.625
1percent of that investment for the remaining 8 taxable years or the amount by which
2the sum of the claimant's certified capital investments and the claimant's qualified
3investments exceeds the claimant's qualified investments in the taxable year before
4the claimant first claimed the credit under this subsection, whichever is less.
SB249-SSA1,10,65
(c) Subsection 71.28 (4) (e), (f), (g), and (h), as it applies to the credit under 71.28
6(4), applies to the credit under this subsection.
SB249-SSA1,10,147
(d) Partnerships, limited liability companies, and tax-option corporations may
8not claim the credit under this subsection, but the eligibility for, and the amount of,
9the credit are based on their payment of a certified capital investment. A
10partnership, limited liability company, or tax-option corporation shall compute the
11amount of credit that each of its partners, members, or shareholders may claim and
12shall provide that information to each of them. Partners, members of limited liability
13companies, and shareholders of tax-option corporations may claim the credit in
14proportion to their ownership interest.
SB249-SSA1,10,2015
(e) 1. If a certified capital company is decertified, or an investment pool is
16disqualified, under s. 560.37 before the certified capital company fulfills the
17investment requirement under s. 560.34 (1m) (a) 1. with respect to the investment
18pool, any claimant that has received a credit under this subsection with respect to
19that investment pool shall repay that credit to the department of revenue and may
20not claim more credit in respect to that investment pool.
SB249-SSA1,11,521
2. If a certified capital company fulfills the investment requirement under s.
22560.34 (1m) (a) 1. with respect to an investment pool but the certified capital
23company is decertified, or an investment pool is disqualified, under s. 560.37 before
24the certified capital company fulfills the investment requirement under s. 560.34
25(1m) (a) 2. for that investment pool, any claimant that has received a credit under
1this subsection with respect to that investment pool shall repay all credits that were
2claimed for taxable years after the taxable year that includes the 3rd anniversary of
3the investment date of the investment pool and may claim no more credits for taxable
4years after the taxable year that includes the 3rd anniversary of the investment date
5of the investment pool.
SB249-SSA1,11,77
71.49
(1) (dm) Certified capital company credit under s. 71.47 (7).
SB249-SSA1,11,99
71.49
(1) (dn) The certified capital company credit under s. 71.47 (7m).
SB249-SSA1, s. 14
10Section
14. 76.635 (2) of the statutes is renumbered 76.635 (2) (a) and
11amended to read:
SB249-SSA1,11,1812
76.635
(2) (a)
An For taxable years beginning before July 1, 2005, an insurer
13that makes a certified capital investment may credit against the fees due under s.
1476.60, 76.63, 76.65, 76.66 or 76.67, for 10 years beginning with the year of the
15investment, either
10% 10 percent of that investment or the amount by which the
16sum of the insurer's certified capital investments and the insurer's qualified
17investments exceeds the insurer's qualified investments in the taxable year before
18the insurer first claimed the credit under this section, whichever is less.
SB249-SSA1,12,220
76.635
(2) (b) For taxable years beginning after June 30, 2005, an insurer that
21makes a certified capital investment may credit against the fees due under s. 76.60,
2276.63, 76.65, 76.66 or 76.67, for 10 years beginning with the year of the investment,
23either 7.5 percent of that investment for the first 2 taxable years and 10.625 percent
24of that investment for the remaining 8 taxable years or the amount by which the sum
25of the insurer's certified capital investments and the insurer's qualified investments
1exceeds the insurer's qualified investments in the taxable year before the insurer
2first claimed the credit under this section, whichever is less.
SB249-SSA1,12,184
77.92
(4) "Net business income", with respect to a partnership, means taxable
5income as calculated under section
703 of the Internal Revenue Code; plus the items
6of income and gain under section
702 of the Internal Revenue Code, including taxable
7state and municipal bond interest and excluding nontaxable interest income or
8dividend income from federal government obligations; minus the items of loss and
9deduction under section
702 of the Internal Revenue Code, except items that are not
10deductible under s. 71.21; plus guaranteed payments to partners under section
707 11(c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de),
12(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx),
and (3g),
and (3s)
, and (7m); and plus or
13minus, as appropriate, transitional adjustments, depreciation differences, and basis
14differences under s. 71.05 (13), (15), (16), (17), and (19); but excluding income, gain,
15loss, and deductions from farming. "Net business income", with respect to a natural
16person, estate, or trust, means profit from a trade or business for federal income tax
17purposes and includes net income derived as an employee as defined in section
3121 18(d) (3) of the Internal Revenue Code.
SB249-SSA1, s. 17
19Section
17. Subchapter II (title) of chapter [precedes 560.30] of the statutes
20is amended to read: