SB4: Bill Text

LRB-0784/1

MES:wlj:rs

2007 - 2008 LEGISLATURE

2007 Senate BILL 4

January 8, 2007 - Introduced by Senators Kedzie, Darling, Roessler, Kanavas, A. Lasee, Lazich and Schultz, cosponsored by Representatives Lothian, Nass, Boyle, Ziegelbauer, Jeskewitz, Kerkman, Gundrum, Pridemore, Gunderson, Hahn, Musser, Nerison, Vukmir, Suder, Van Roy, Davis, Vos, LeMahieu, Albers, Nygren, Townsend, Bies and Ott. Referred to Joint Survey Committee on Tax Exemptions.

SB4,1,3 An Act to amend 71.03 (2) (a) 1. and 71.05 (23) (b) 3.; and to create 71.05 (23) (b) 4. and 71.05 (23) (b) 5. of the statutes; relating to: increasing the amount of the individual income tax personal exemption for certain older taxpayers.

Analysis by the Legislative Reference Bureau

Under current law, an individual income tax personal exemption exists in the amount of $700 for each taxpayer who is required to file an income tax return and $700 for the taxpayer's spouse, except if the spouse is filing separately or as a head of household. A taxpayer may also claim a $700 exemption for each dependent for whom he or she is entitled to claim an exemption under the Internal Revenue Code. In general, an additional exemption of $250 may be claimed by a taxpayer who has reached the age of 65 before the close of the taxable year to which his or her tax return relates.

This bill increases the additional exemption that may be claimed by taxpayers who reach the age of 70 or 75 before the close of the taxable year to which his or her tax return relates. Under the bill, in general, an additional exemption of $300 may be claimed by a taxpayer who has reached the age of 70 before the close of the taxable year to which his or her tax return relates and an additional exemption of $350 may be claimed by a taxpayer who has reached the age of 75 before the close of the taxable year to which his or her tax return relates.

This bill will be referred to the Joint Survey Committee on Tax Exemptions for a detailed analysis, which will be printed as an appendix to this bill.

For further information see the state 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:

SB4, s. 1 Section 1. 71.03 (2) (a) 1. of the statutes is amended to read:

SB4,2,12 71.03 (2) (a) 1. Every individual domiciled in this state during the entire taxable year who has a gross income at or above a threshold amount which shall be determined annually by the department of revenue. The threshold amounts shall be determined for categories of individuals based on filing status and age, and shall include categories for single individuals; individuals who file as a head of household; married couples who file jointly; and married persons who file separately. The threshold amounts shall also be determined by taking into account the exemption amounts in s. 71.05 (23) (b) 1., 3., 4., and 5. The department of revenue shall establish a threshold amount for each category of individual at an amount at which no individual in that category whose gross income is below that amount has a state income tax liability.

SB4, s. 2 Section 2. 71.05 (23) (b) 3. of the statutes is amended to read:

SB4,2,19 71.05 (23) (b) 3. An Except for a taxpayer or his or her spouse who claims the exemption under subd. 4. or 5., an additional exemption of $250 if the taxpayer has reached the age of 65 before the close of the taxable year to which his or her tax return relates and $250 for the taxpayer's spouse if he or she has reached the age of 65 before the close of the taxable year to which his or her tax return relates, except if the spouse is filing separately or as a head of household.

SB4, s. 3 Section 3. 71.05 (23) (b) 4. of the statutes is created to read:

SB4,3,6 71.05 (23) (b) 4. Except for a taxpayer or his or her spouse who claims the exemption under subd. 5., an additional exemption of $300 if the taxpayer has reached the age of 70 before the close of the taxable year to which his or her tax return relates and $300 for the taxpayer's spouse if he or she has reached the age of 70 before the close of the taxable year to which his or her tax return relates, except if the spouse is filing separately or as a head of household.

SB4, s. 4 Section 4. 71.05 (23) (b) 5. of the statutes is created to read:

SB4,3,12 71.05 (23) (b) 5. An additional exemption of $350 if the taxpayer has reached the age of 75 before the close of the taxable year to which his or her tax return relates and $350 for the taxpayer's spouse if he or she has reached the age of 75 before the close of the taxable year to which his or her tax return relates, except if the spouse is filing separately or as a head of household.

SB4, s. 5 Section 5. Initial applicability.

SB4,3,17 (1) This act first applies to taxable years beginning on January 1 of the year in which this subsection takes effect, except that if this subsection takes effect after July 31 this act first applies to taxable years beginning on January 1 of the year following the year in which this subsection takes effect.

SB4,3,18 (End)