LRB-3180/1
JK:wlj:rs
2005 - 2006 LEGISLATURE
July 18, 2005 - Introduced by Senators Decker, Robson, Breske, Carpenter,
Erpenbach, Hansen, Jauch, Lassa, Miller, Risser, Taylor and Wirch,
cosponsored by Representatives
Black, Shilling, Kreuser, Benedict,
Berceau, Boyle, Fields, Grigsby, Hebl, Kessler, Lehman, Molepske, Nelson,
Parisi, Pocan, Pope-Roberts, Richards, Seidel, Sherman, Sheridan, Sinicki,
Staskunas, Toles, Turner, Vruwink, Young and Zepnick. Referred to Joint
Survey Committee on Tax Exemptions.
SB260,1,7
1An Act to amend 71.07 (9) (b) 5., 74.09 (3) (b) 6., 79.10 (1) (dm), 79.10 (1m), 79.10
2(2), 79.10 (6m) (a), 79.10 (9) (c) 1., 79.10 (10) (title), 79.10 (10) (a), 79.10 (10) (b),
379.10 (10) (bm), 79.10 (10) (bn), 79.10 (10) (c), 79.10 (10) (e) 2. and 79.10 (10) (f);
4and
to create 20.835 (3) (bm), 79.10 (5m), 79.10 (7m) (c) and 79.10 (9) (bn) of
5the statutes;
relating to: creating a homeowner's property tax credit,
6increasing the amount of the school property income tax credit, and making an
7appropriation.
Analysis by the Legislative Reference Bureau
This bill creates a homeowner's tax credit. Under the bill, a person who owns
property in this state that the person uses as a principal dwelling may claim the
homeowner's credit as a credit against the property taxes imposed on his or her
principal dwelling. The amount of the credit is based on the fair market value of the
person's principal dwelling, up to a fair market value of $60,000.
Under current law, a person may claim an income tax credit based on the
amount of property taxes or rent paid on the person's principal dwelling. The amount
of the credit is equal to 12 percent of the first $2,500 of property taxes or rent paid
on the person's principal dwelling, or, for married persons filing separately, 12
percent of the first $1,250 of property taxes or rent paid on the person's principal
dwelling. Under the bill, with regard to rent paid on a person's principal dwelling,
the amount of the credit is equal to 16 percent of the first $2,500 of rent paid on the
person's principal dwelling, or, for married persons filing separately, 16 percent of the
first $1,250 of rent paid on the person's principal dwelling.
For further information see the state and local 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:
SB260, s. 1
1Section
1. 20.835 (3) (bm) of the statutes is created to read:
SB260,2,32
20.835
(3) (bm)
Homeowner's tax credit. A sum sufficient to make the payments
3under s. 79.10 (5m) and (6m) (c).
SB260, s. 2
4Section
2. 71.07 (9) (b) 5. of the statutes is amended to read:
SB260,2,115
71.07
(9) (b) 5. For taxable years beginning after December 31, 1999, subject
6to the limitations under this subsection a claimant may claim as a credit against, but
7not to exceed the amount of, taxes under s. 71.02,
12%
12 percent of the first $2,500
8of property taxes or
16 percent of the first $2,500 of rent constituting property taxes,
9or 12% except that a married person filing separately may claim 12 percent of the
10first $1,250 of property taxes or
16 percent of the first $1,250 of rent constituting
11property taxes
of a married person filing separately.
SB260, s. 3
12Section
3. 74.09 (3) (b) 6. of the statutes is amended to read:
SB260,2,1513
74.09
(3) (b) 6. The amount of the
credit credits under s. 79.10 (5)
and (5m) 14allocable to the property for the previous year and the current year, and the
15percentage change between those years.
SB260, s. 4
16Section
4. 79.10 (1) (dm) of the statutes is amended to read:
SB260,3,217
79.10
(1) (dm) "Principal dwelling" means any dwelling that is used by the
18owner of the dwelling as a primary residence on January 1 of the year preceding the
1allocation of
a credit credits under sub. (9) (bm)
and (bn) and includes improvements
2that are classified, under ch. 70, as taxable real property or personal property.
SB260, s. 5
3Section
5. 79.10 (1m) of the statutes is amended to read:
SB260,3,54
79.10
(1m) (a) Each municipality shall notify the department of revenue of the
5total amount of credits allocated under sub. (9) (bm)
and (bn).
SB260,3,86
(b) Counties and municipalities shall submit to the department of revenue all
7data related to the lottery and gaming credit and
homeowner's tax credit that is 8requested by the department of revenue.
SB260, s. 6
9Section
6. 79.10 (2) of the statutes is amended to read:
SB260,3,1710
79.10
(2) Notice to municipalities. On or before December 1 of the year
11preceding the distribution under sub. (7m) (a), the department of revenue shall
12notify the clerk of each town, village and city of the estimated fair market value, as
13determined under sub. (11), to be used to calculate the lottery and gaming credit
14under sub. (5)
and the homeowner's tax credit under sub. (5m) and of the amount to
15be distributed to it under sub. (7m) (a) on the following 4th Monday in July. The
16anticipated receipt of such distribution shall not be taken into consideration in
17determining the tax rate of the municipality but shall be applied as tax credits.
SB260, s. 7
18Section
7. 79.10 (5m) of the statutes is created to read:
SB260,3,2419
79.10
(5m) Homeowner's tax credit. Each municipality shall receive, from the
20appropriation under s. 20.835 (3) (bm), an amount determined by multiplying the
21school tax rate by the estimated fair market value, determined under sub. (11), but
22not to exceed $60,000, of every principal dwelling that is located in the municipality
23and for which a claim for the credit under sub. (9) (bn) is made by the owner of the
24principal dwelling.
SB260, s. 8
25Section
8. 79.10 (6m) (a) of the statutes is amended to read:
SB260,4,14
179.10
(6m) (a) Except as provided in pars. (b) and (c), if the department of
2administration or the department of revenue determines by October 1 of the year of
3any distribution under subs. (4)
and, (5)
, and (5m) that there was an overpayment
4or underpayment made in that year's distribution by the department of
5administration to municipalities, as determined under subs. (4)
and, (5)
, and (5m),
6because of an error by the department of administration, the department of revenue
, 7or any municipality, the overpayment or underpayment shall be corrected as
8provided in this paragraph. Any overpayment shall be corrected by reducing the
9subsequent year's distribution, as determined under subs. (4)
and, (5)
, and (5m), by
10an amount equal to the amount of the overpayment. Any underpayment shall be
11corrected by increasing the subsequent year's distribution, as determined under
12subs. (4)
and, (5)
, and (5m), by an amount equal to the amount of the underpayment.
13Corrections shall be made in the distributions to all municipalities affected by the
14error. Corrections shall be without interest.
SB260, s. 9
15Section
9. 79.10 (7m) (c) of the statutes is created to read:
SB260,4,1916
79.10
(7m) (c)
Homeowner's tax credit. 1. The amount determined under sub.
17(5m) with respect to claims filed for which the town, village, or city has furnished
18notice under sub. (1m) by March 1 shall be distributed from the appropriation under
19s. 20.835 (3) (bm) by the department of administration on the 4th Monday in March.
SB260,5,220
2. The town, village, or city treasurer shall settle for the amounts distributed
21on the 4th Monday in March under this paragraph with each taxing jurisdiction
22within the taxation district or provide the amounts distributed to the appropriate
23county treasurer for settlement not later than April 15. Failure to settle timely under
24this subdivision subjects the town, village, or city treasurer to the penalties under
1s. 74.31. On or before August 20, the county treasurer shall settle with each taxing
2jurisdiction, including towns, villages, and cities except 1st class cities, in the county.
SB260, s. 10
3Section
10. 79.10 (9) (bn) of the statutes is created to read:
SB260,5,84
79.10
(9) (bn)
Homeowner's tax credit. Except as provided in ss. 79.175 and
579.18, a homeowner's tax credit shall be allocated to every principal dwelling for
6which a credit is claimed under sub. (10) in an amount determined by multiplying
7the estimated fair market value of the principal dwelling, as determined under sub.
8(11), but not to exceed $60,000, by the school tax rate.
SB260, s. 11
9Section
11. 79.10 (9) (c) 1. of the statutes is amended to read:
SB260,5,1310
79.10
(9) (c) 1. The lottery and gaming credit under par. (bm)
and the
11homeowner's tax credit under par. (bn) shall reduce the property taxes otherwise
12payable on property that is eligible for that credit and if the property owner
13completes the information required under sub. (10) (a) or (b).
SB260, s. 12
14Section
12. 79.10 (10) (title) of the statutes is amended to read:
SB260,5,1615
79.10
(10) (title)
Claiming the lottery and gaming credit and the
16homeowner's tax credit.
SB260, s. 13
17Section
13. 79.10 (10) (a) of the statutes is amended to read:
SB260,6,718
79.10
(10) (a)
Beginning with property taxes levied in 1999, the The owner of
19a principal dwelling may claim the
credit credits under sub. (9) (bm)
and (bn) by
20applying for the
credit credits on a form prescribed by the department of revenue.
21A claimant shall attest that, as of the certification date, the claimant is an owner of
22property and that such property is used by the owner in the manner specified under
23sub. (1) (dm). The certification date is January 1 of the year in which the property
24taxes are levied. The claimant shall file the application for the
lottery and gaming
25credit credits with the treasurer of the county in which the property is located or, if
1the property is located in a city that collects taxes under s. 74.87, with the treasurer
2of the city in which the property is located. Subject to review by the department of
3revenue, a treasurer who receives a completed application shall direct that the
4property described in the application be identified on the next tax roll as property for
5which the owner is entitled to receive
a lottery and gaming credit credits. A claim
6that is made under this paragraph is valid for as long as the property is eligible for
7the
credit credits under sub. (9) (bm)
and (bn).
SB260, s. 14
8Section
14. 79.10 (10) (b) of the statutes is amended to read:
SB260,6,159
79.10
(10) (b) A person who becomes eligible for
a credit credits under sub. (9)
10(bm)
and (bn) may claim the
credit
credits by filing an application, on a form
11prescribed by the department of revenue, with the treasurer of the county in which
12the property is located or, if the property is located in a city that collects taxes under
13s. 74.87, with the treasurer of the city in which the property is located. Claims made
14under this paragraph are valid for as long as the property is eligible for the
credit 15credits under sub. (9) (bm)
and (bn).
SB260, s. 15
16Section
15. 79.10 (10) (bm) of the statutes is amended to read:
SB260,7,317
79.10
(10) (bm) 1. A person who is eligible for
a credit credits under sub. (9) (bm)
18and (bn) but whose property tax bill does not reflect the
credit credits may claim the
19credit credits by applying to the treasurer of the taxation district in which the
20property is located for the
credit credits under par. (a) by January 31 following the
21issuance of the person's property tax bill. The treasurer shall compute the amount
22of the
credit credits; subtract the amount of the
credit credits from the person's
23property tax bill; notify the person of the reduced amount of the property taxes due;
24issue a refund to the person if the person has paid the property taxes in full; and enter
25the person's property on the next tax roll as property that qualifies for a lottery and
1gaming credit
and a homeowner's tax credit. Claims made under this subdivision
2are valid for as long as the property is eligible for the
credit credits under sub. (9) (bm)
3and (bn).
SB260,7,144
2. A person who may apply for
a credit credits under subd. 1. but who does not
5timely apply for the
credit credits under subd. 1. may apply to the department of
6revenue no later than October 1 following the issuance of the person's property tax
7bill. Subject to review by the department, the department shall compute the amount
8of the
credit credits; issue a check to the person in the amount of the
credit credits;
9and notify the treasurer of the county in which the person's property is located or the
10treasurer of the taxation district in which the person's property is located, if the
11taxation district collects taxes under s. 74.87. The treasurer shall enter the person's
12property on the next tax roll as property that qualifies for a lottery and gaming credit
13and a homeowner's tax credit. Claims made under this subdivision are valid for as
14long as the property is eligible for the
credit credits under sub. (9) (bm)
and (bn).
SB260, s. 16
15Section
16. 79.10 (10) (bn) of the statutes is amended to read:
SB260,7,2516
79.10
(10) (bn) 1. If a person who owns and uses property as specified under
17sub. (1) (dm), as of the certification date under par. (a), transfers the property after
18the certification date, the transferee may apply to the treasurer of the county in
19which the property is located or, if the property is located in a city that collects taxes
20under s. 74.87, to the treasurer of the city in which the property is located for the
21credit credits under sub. (9) (bm)
and (bn) on a form prescribed by the department
22of revenue. The transferee shall attest that, to the transferee's knowledge, the
23transferor used the property in the manner specified under sub. (1) (dm) as of the
24certification date under par. (a). A claim that is made under this subdivision is valid
25for as long as the property is eligible for the
credit
credits under sub. (9) (bm)
and (bn).
SB260,8,8
12. A person who is eligible for
a credit
credits under subd. 1. but whose property
2tax bill does not reflect the
credit credits may claim the
credit credits by applying to
3the treasurer of the taxation district in which the property is located for the
credit 4credits by January 31 following the issuance of the person's property tax bill. Claims
5made after January 31, but no later than October 1 following the issuance of the
6person's property tax bill, shall be made to the department of revenue. Paragraph
7(bm), as it applies to processing claims made under that paragraph, applies to
8processing claims made under this subdivision.
SB260, s. 17
9Section
17. 79.10 (10) (c) of the statutes is amended to read:
SB260,8,1510
79.10
(10) (c) If a person who is certified under par. (a) to claim the
credit credits 11under sub. (9) (bm)
and (bn) becomes ineligible for the
credit credits under sub. (9)
12(bm)
and (bn), that person shall, within 30 days of becoming ineligible, notify the
13treasurer of the county in which the property is located or, if the property is located
14in a city that collects taxes under s. 74.87, the treasurer of the city in which the
15property is located.
SB260, s. 18
16Section
18. 79.10 (10) (e) 2. of the statutes is amended to read:
SB260,8,1817
79.10
(10) (e) 2. The certification procedure includes a procedure that is similar
18in effect to the procedure described in
par. pars. (bm)
and (bn).
SB260, s. 19
19Section
19. 79.10 (10) (f) of the statutes is amended to read:
SB260,9,220
79.10
(10) (f) Each county and city that administers the
credit credits under
21sub. (9) (bm)
and (bn) shall implement a procedure to periodically verify the
22eligibility of properties for which a credit is claimed. In 2004, and every 5th year
23thereafter, each county and city that administers the
credit credits under sub. (9)
24(bm)
and (bn) shall file a report with the department of revenue, in the manner and
25at the time prescribed by the department of revenue, that describes the procedures
1that the county or city uses to verify the credits claimed under this subsection and
2evaluates the efficacy of such procedures.
SB260,9,94
(1)
Homeowner's tax credit. An application for the lottery and gaming credit
5under section 79.10 (10), 2003 stats., shall be considered to be an application for the
6homeowner's tax credit under section 79.10 (10) of the statutes, as affected by this
7act, and any valid claim for the lottery and gaming credit under section 79.10 (10),
82003 stats., shall be considered to be a valid claim for the homeowner's tax credit
9under section 79.10 (10) of the statutes, as affected by this act.
SB260,9,1710
(2)
Report. Notwithstanding section 13.52 (5) and (6) of the statutes, the joint
11survey committee on tax exemptions shall prepare a report that, to provide funding
12for the homeowner's tax credit under section 79.10 (5) of the statutes, as affected by
13this act, recommends changes to the corporate income and franchise taxes imposed
14by this state, not including any increase in corporate income or franchise tax rates,
15and repealing certain sales and use tax exemptions that primarily affect
16corporations. The committee shall submit the report to the legislature no later than
1760 days after the effective date of this subsection.
SB260,9,2219
(1)
Homeowner's tax credit. The treatment of sections 20.835 (3) (bm), 74.09
20(3) (b) 6., and 79.10 (1) (dm), (1m), (2), (5m), (6m) (a), (7m) (c), (9) (bn) and (c) 1., and
21(10) (title), (a), (b), (bm), (bn), (c), (e) 2., and (f) of the statutes first applies to property
22taxes levied in 2005.