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SB62,41,3
171.01 (5n) For purposes of s. 71.05 (6) (a) 24. and (b) 46., "intangible expenses"
2include the following, to the extent that the amounts would otherwise be deductible
3in computing Wisconsin adjusted gross income:
SB62,41,64 (a) Expenses, losses, and costs for, related to, or directly or indirectly in
5connection with the acquisition, use, maintenance, management, ownership, sale,
6exchange, or any other disposition of intangible property.
SB62,41,87 (b) Losses related to, or incurred in connection directly or indirectly with,
8factoring transactions or discounting transactions.
SB62,41,99 (c) Royalty, patent, technical, and copyright fees.
SB62,41,1010 (d) Licensing fees.
SB62,41,1111 (e) Other similar expenses, losses, and costs.
SB62, s. 77 12Section 77. 71.01 (5p) of the statutes is created to read:
SB62,41,1513 71.01 (5p) "Intangible property" includes stocks, bonds, financial instruments,
14patents, patent applications, trade names, trademarks, service marks, copyrights,
15mask works, trade secrets, and similar types of intangible assets.
SB62, s. 78 16Section 78. 71.01 (7v) of the statutes is created to read:
SB62,41,2317 71.01 (7v) For purposes of s. 71.05 (6) (a) 24. and (b) 46., "management fees"
18include expenses and costs, not including interest expenses, pertaining to accounts
19receivable, accounts payable, employee benefit plans, insurance, legal matters,
20payroll, data processing, purchasing, taxation, financial matters, securities,
21accounting, or reporting and compliance matters or similar activities, to the extent
22that the amounts would otherwise be deductible in the computation of Wisconsin
23adjusted gross income.
SB62, s. 79 24Section 79. 71.01 (10g) of the statutes is amended to read:
SB62,42,4
171.01 (10g) For purposes of s. 71.04 (7) (df) and, (dh), (dj), and (dk), "state"
2means a state of the United States, the District of Columbia, the commonwealth of
3Puerto Rico, or any territory or possession of the United States, unless the context
4requires that "state" means only the state of Wisconsin.
SB62, s. 80 5Section 80. 71.04 (7) (d) of the statutes is repealed.
SB62, s. 81 6Section 81. 71.04 (7) (dj) of the statutes is created to read:
SB62,42,127 71.04 (7) (dj) 1. Except as provided in par. (df), gross royalties and other gross
8receipts received for the use or license of intangible property, including patents,
9copyrights, trademarks, trade names, service names, franchises, licenses, plans,
10specifications, blueprints, processes, techniques, formulas, designs, layouts,
11patterns, drawings, manuals, technical know-how, contracts, and customer lists, are
12sales in this state if any of the following applies:
SB62,42,1813 a. The purchaser or licensee uses the intangible property in the operation of a
14trade or business at a location in this state. If the purchaser or licensee uses the
15intangible property in the operation of a trade or business in more than one state,
16the gross royalties and other gross receipts from the use of the intangible property
17shall be divided between those states having jurisdiction to impose an income tax on
18the taxpayer in proportion to the use of the intangible property in those states.
SB62,42,2019 b. The purchaser or licensee is billed for the purchase or license of the use of
20the intangible property at a location in this state.
SB62,42,2221 c. The purchaser or licensee of the use of the intangible property has its
22commercial domicile in this state.
SB62,43,223 2. If the taxpayer is not within the jurisdiction, for income or franchise tax
24purposes, in the state in which the gross royalties or other gross receipts are
25apportioned under this paragraph, but the taxpayer's commercial domicile is in this

1state, 50 percent of those gross royalties or other gross receipts shall be included in
2the numerator of the sales factor.
SB62, s. 82 3Section 82. 71.04 (7) (dk) of the statutes is created to read:
SB62,43,54 71.04 (7) (dk) 1. Sales of intangible property, excluding securities, are sales in
5this state if any of the following applies:
SB62,43,106 a. The purchaser uses the intangible property in the regular course of business
7operations in this state or for personal use in this state. If the purchaser uses the
8intangible property in more than one state, the sales shall be divided between those
9states having jurisdiction to impose an income tax on the taxpayer in proportion to
10the use of the intangible property in those states.
SB62,43,1211 b. The purchaser is billed for the purchase of the intangible property at a
12location in this state.
SB62,43,1413 c. The purchaser of the intangible property has its commercial domicile in this
14state.
SB62,43,1815 2. If the taxpayer is not within the jurisdiction, for income or franchise tax
16purposes, in the state in which the sales of intangible property are apportioned under
17this paragraph, but the taxpayer's commercial domicile is in this state, 50 percent
18of those gross receipts shall be included in the numerator of the sales factor.
SB62, s. 83 19Section 83. 71.04 (8) (a) of the statutes is renumbered 71.04 (8) (a) 1.
SB62, s. 84 20Section 84. 71.04 (8) (a) 2. of the statutes is created to read:
SB62,43,2421 71.04 (8) (a) 2. As used in this section, "financial organization" includes any
22subsidiary of an entity described in subd. 1., if a significant purpose for the
23subsidiary is to hold investments or if the subsidiary primarily functions to hold
24investments.
SB62, s. 85 25Section 85. 71.05 (6) (a) 15. of the statutes is amended to read:
SB62,44,6
171.05 (6) (a) 15. The amount of the credits computed under s. 71.07 (2dd), (2de),
2(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3r), (3s), (3t),
3(3w), (5e), (5f), (5h), (5i), (5j), and (5k) and not passed through by a partnership,
4limited liability company, or tax-option corporation that has added that amount to
5the partnership's, company's, or tax-option corporation's income under s. 71.21 (4)
6or 71.34 (1k) (g).
SB62, s. 86 7Section 86. 71.05 (6) (a) 24. of the statutes is amended to read:
SB62,44,128 71.05 (6) (a) 24. The amount deducted or excluded under the Internal Revenue
9Code for interest expenses and, rental expenses, intangible expenses, and
10management fees
that are directly or indirectly paid, accrued, or incurred to, or in
11connection directly or indirectly with one or more direct or indirect transactions with,
12one or more related entities.
SB62, s. 87 13Section 87. 71.05 (6) (b) 46. of the statutes is amended to read:
SB62,44,1914 71.05 (6) (b) 46. An amount added, pursuant to par. (a) 24. or s. 71.26 (2) (a) 7.,
1571.34 (1k) (j), or 71.45 (2) (a) 16., to the federal income of a related entity that paid
16interest expenses or, rental expenses , intangible expenses, or management fees to
17the individual or fiduciary, to the extent that the related entity could not offset such
18amount with the deduction allowable under subd. 45. or s. 71.26 (2) (a) 8., 71.34 (1k)
19(k), or 71.45 (2) (a) 17.
SB62, s. 88 20Section 88. 71.07 (2dr) (a) of the statutes is amended to read:
SB62,45,1821 71.07 (2dr) (a) Credit. Any person may credit against taxes otherwise due
22under this chapter an amount equal to 5% of the amount obtained by subtracting
23from the person's qualified research expenses, as defined in section 41 of the internal
24revenue code, except that "qualified research expenses" include only expenses
25incurred by the claimant in a development zone under subch. VI of ch. 560, except

1that a taxpayer may elect the alternative computation under section 41 (c) (4) of the
2Internal Revenue Code and that election applies until the department permits its
3revocation and except that "qualified research expenses" do not include
4compensation used in computing the credit under sub. (2dj) nor research expenses
5incurred before the claimant is certified for tax benefits under s. 560.765 (3), the
6person's base amount, as defined in section 41 (c) of the internal revenue code, in a
7development zone, except that gross receipts used in calculating the base amount
8means gross receipts from sales attributable to Wisconsin under s. 71.04 (7) (b) 1. and
92., (d), (df) 1. and 2., and (dh) 1., 2., and 3., (dj) 1. and (dk) 1. and research expenses
10used in calculating the base amount include research expenses incurred before the
11claimant is certified for tax benefits under s. 560.765 (3), in a development zone, if
12the claimant submits with the claimant's return a copy of the claimant's certification
13for tax benefits under s. 560.765 (3) and a statement from the department of
14commerce verifying the claimant's qualified research expenses for research
15conducted exclusively in a development zone. The rules under s. 73.03 (35) apply to
16the credit under this paragraph. The rules under sub. (2di) (f) and (g), as they apply
17to the credit under that subsection, apply to claims under this paragraph. Section
1841 (h) of the internal revenue code does not apply to the credit under this paragraph.
SB62, s. 89 19Section 89. 71.07 (2dy) of the statutes is created to read:
SB62,45,2220 71.07 (2dy) Economic development tax credit. (a) Definition. In this
21subsection, "claimant" means a person who files a claim under this subsection and
22is certified under s. 560.701 (2) and authorized to claim tax benefits under s. 560.703.
SB62,46,223 (b) Filing claims. Subject to the limitations under this subsection and ss.
24560.701 to 560.706, for taxable years beginning after December 31, 2008, a claimant

1may claim as a credit against the tax imposed under s. 71.02 or 71.08, up to the
2amount of the tax, the amount authorized for the claimant under s. 560.703.
SB62,46,63 (c) Limitations. 1. No credit may be allowed under this subsection unless the
4claimant includes with the claimant's return a copy of the claimant's certification
5under s. 560.701 (2) and a copy of the claimant's notice of eligibility to receive tax
6benefits under s. 560.703 (3).
SB62,46,147 2. 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 authorization to claim tax benefits under s. 560.703.
10A partnership, limited liability company, or tax-option corporation shall compute
11the amount of credit that each of its partners, members, or shareholders may claim
12and shall provide that information to each of them. Partners, members of limited
13liability companies, and shareholders of tax-option corporations may claim the
14credit in proportion to their ownership interests.
SB62,46,1715 (d) Administration. 1. Except as provided in subd. 2., s. 71.28 (4) (e) and (f),
16as it applies to the credit under s. 71.28 (4), applies to the credit under this
17subsection.
SB62,47,218 2. If a claimant's certification is revoked under s. 560.705, or if a claimant
19becomes ineligible for tax benefits under s. 560.702, the claimant may not claim
20credits under this subsection for the taxable year that includes the day on which the
21certification is revoked; the taxable year that includes the day on which the claimant
22becomes ineligible for tax benefits; or succeeding taxable years and the claimant may
23not carry over unused credits from previous years to offset the tax imposed under s.
2471.02 or 71.08 for the taxable year that includes the day on which certification is

1revoked; the taxable year that includes the day on which the claimant becomes
2ineligible for tax benefits; or succeeding taxable years.
SB62,47,43 3. Section 71.28 (4) (g) and (h), as it applies to the credit under s. 71.28 (4),
4applies to the credit under this subsection.
SB62, s. 90 5Section 90. 71.07 (3p) (a) 1m. of the statutes is created to read:
SB62,47,76 71.07 (3p) (a) 1m. "Dairy cooperative" means a business organized under ch.
7185 or 193 for the purpose of obtaining or processing milk.
SB62, s. 91 8Section 91. 71.07 (3p) (a) 3. (intro.) of the statutes is amended to read:
SB62,47,159 71.07 (3p) (a) 3. (intro.) "Dairy manufacturing modernization or expansion"
10means constructing, improving, or acquiring buildings or facilities, or acquiring
11equipment, for dairy manufacturing, including the following, if used exclusively for
12dairy manufacturing and if acquired and placed in service in this state during
13taxable years that begin after December 31, 2006, and before January 1, 2015, or, in
14the case of dairy cooperatives, if acquired and placed in service in this state during
15taxable years that begin after December 31, 2008, and before January 1, 2017
:
SB62, s. 92 16Section 92. 71.07 (3p) (b) of the statutes is amended to read:
SB62,47,2317 71.07 (3p) (b) Filing claims. Subject to the limitations provided in this
18subsection and s. 560.207, except as provided in par. (c) 5., for taxable years
19beginning after December 31, 2006, and before January 1, 2015, a claimant may
20claim as a credit against the taxes imposed under s. 71.02 or 71.08, up to the amount
21of the tax, an amount equal to 10 percent of the amount the claimant paid in the
22taxable year for dairy manufacturing modernization or expansion related to the
23claimant's dairy manufacturing operation.
SB62, s. 93 24Section 93. 71.07 (3p) (c) 2m. b. of the statutes is amended to read:
SB62,48,4
171.07 (3p) (c) 2m. b. The maximum amount of the credits that may be claimed
2by all claimants, other than members of dairy cooperatives, under this subsection
3and ss. 71.28 (3p) and 71.47 (3p) in fiscal year 2008-09, and in each fiscal year
4thereafter, is $700,000, as allocated under s. 560.207.
SB62, s. 94 5Section 94. 71.07 (3p) (c) 2m. bm. of the statutes is created to read:
SB62,48,126 71.07 (3p) (c) 2m. bm. The maximum amount of the credits that may be claimed
7by members of dairy cooperatives under this subsection and ss. 71.28 (3p) and 71.47
8(3p) in fiscal year 2009-10 is $600,000, as allocated under s. 560.207, and the
9maximum amount of the credits that may be claimed by members of dairy
10cooperatives under this subsection and ss. 71.28 (3p) and 71.47 (3p) in fiscal year
112010-11, and in each fiscal year thereafter, is $700,000, as allocated under s.
12560.207.
SB62, s. 95 13Section 95. 71.07 (3p) (c) 3. of the statutes is amended to read:
SB62,49,214 71.07 (3p) (c) 3. Partnerships, limited liability companies, and tax-option
15corporations, and dairy cooperatives may not claim the credit under this subsection,
16but the eligibility for, and the amount of, the credit are based on their payment of
17expenses under par. (b), except that the aggregate amount of credits that the entity
18may compute shall not exceed $200,000 for each of the entity's dairy manufacturing
19facilities
. A partnership, limited liability company, or tax-option corporation, or
20dairy cooperative
shall compute the amount of credit that each of its partners,
21members, or shareholders may claim and shall provide that information to each of
22them. Partners, members of limited liability companies, and shareholders of
23tax-option corporations may claim the credit in proportion to their ownership
24interest. Members of a dairy cooperative may claim the credit in proportion to the

1amount of milk that each member delivers to the dairy cooperative, as determined
2by the dairy cooperative.
SB62, s. 96 3Section 96. 71.07 (3p) (c) 5. of the statutes is created to read:
SB62,49,74 71.07 (3p) (c) 5. A claimant who is a member of a dairy cooperative may claim
5the credit, based on amounts described under par. (b) that are paid by the dairy
6cooperative, for taxable years beginning after December 31, 2008, and before
7January 1, 2017.
SB62, s. 97 8Section 97. 71.07 (3p) (c) 6. of the statutes is created to read:
SB62,49,119 71.07 (3p) (c) 6. No credit may be allowed under this subsection unless the
10claimant submits with the claimant's return a copy of the claimant's credit
11certification and allocation under s. 560.207.
SB62, s. 98 12Section 98. 71.07 (3p) (d) 2. of the statutes is amended to read:
SB62,49,1813 71.07 (3p) (d) 2. If Except as provided in subd. 3., if the allowable amount of
14the claim under par. (b) exceeds the tax otherwise due under s. 71.02 or 71.08 or no
15tax is due under s. 71.02 or 71.08
, the amount of the claim not used to offset the tax
16due shall be certified by the department of revenue to the department of
17administration for payment by check, share draft, or other draft drawn from the
18appropriation account under s. 20.835 (2) (bn).
SB62, s. 99 19Section 99. 71.07 (3p) (d) 3. of the statutes is created to read:
SB62,49,2520 71.07 (3p) (d) 3. With regard to claims that are based on amounts described
21under par. (b) that are paid by a dairy cooperative, if the allowable amount of the
22claim under par. (b) exceeds the tax otherwise due under s. 71.02 or 71.08, the
23amount of the claim not used to offset the tax due shall be certified by the department
24of revenue to the department of administration for payment by check, share draft,
25or other draft drawn from the appropriation account under s. 20.835 (2) (bp).
SB62, s. 100
1Section 100. 71.07 (3r) of the statutes is created to read:
SB62,50,32 71.07 (3r) Meat processing facility investment credit. (a) Definitions. In this
3subsection:
SB62,50,44 1. "Claimant" means a person who files a claim under this subsection.
SB62,50,65 2. "Meat processing" means processing livestock into meat products or
6processing meat products for sale commercially.
SB62,50,117 3. "Meat processing modernization or expansion" means constructing,
8improving, or acquiring buildings or facilities, or acquiring equipment, for meat
9processing, including the following, if used exclusively for meat processing and if
10acquired and placed in service in this state during taxable years that begin after
11December 31, 2008, and before January 1, 2017:
SB62,50,1312 a. Building construction, including livestock handling, product intake, storage,
13and warehouse facilities.
SB62,50,1414 b. Building additions.
SB62,50,1615 c. Upgrades to utilities, including water, electric, heat, refrigeration, freezing,
16and waste facilities.
SB62,50,1717 d. Livestock intake and storage equipment.
SB62,50,2018 e. Processing and manufacturing equipment, including cutting equipment,
19mixers, grinders, sausage stuffers, meat smokers, curing equipment, cooking
20equipment, pipes, motors, pumps, and valves.
SB62,50,2221 f. Packaging and handling equipment, including sealing, bagging, boxing,
22labeling, conveying, and product movement equipment.
SB62,50,2323 g. Warehouse equipment, including storage and curing racks.
SB62,51,3
1h. Waste treatment and waste management equipment, including tanks,
2blowers, separators, dryers, digesters, and equipment that uses waste to produce
3energy, fuel, or industrial products.
SB62,51,74 i. Computer software and hardware used for managing the claimant's meat
5processing operation, including software and hardware related to logistics,
6inventory management, production plant controls, and temperature monitoring
7controls.
SB62,51,98 4. "Used exclusively" means used to the exclusion of all other uses except for
9use not exceeding 5 percent of total use.
SB62,51,1510 (b) Filing claims. Subject to the limitations provided in this subsection and s.
11560.208, for taxable years beginning after December 31, 2008, and before January
121, 2017, a claimant may claim as a credit against the taxes imposed under s. 71.02
13or 71.08, up to the amount of the tax, an amount equal to 10 percent of the amount
14the claimant paid in the taxable year for meat processing modernization or
15expansion related to the claimant's meat processing operation.
SB62,51,1816 (c) Limitations. 1. No credit may be allowed under this subsection for any
17amount that the claimant paid for expenses described under par. (b) that the
18claimant also claimed as a deduction under section 162 of the Internal Revenue Code.
SB62,51,2019 2. The aggregate amount of credits that a claimant may claim under this
20subsection is $200,000.
SB62,51,2321 3. a. The maximum amount of the credits that may be allocated under this
22subsection and ss. 71.28 (3r) and 71.47 (3r) in fiscal year 2009-10 is $300,000, as
23allocated under s. 560.208.
SB62,52,3
1b. The maximum amount of the credits that may be allocated under this
2subsection and ss. 71.28 (3r) and 71.47 (3r) in fiscal year 2010-11, and in each fiscal
3year thereafter, is $700,000, as allocated under s. 560.208.
SB62,52,124 4. 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 expenses under par. (b), except that the
7aggregate amount of credits that the entity may compute shall not exceed $200,000.
8A partnership, limited liability company, or tax-option corporation shall compute
9the amount of credit that each of its partners, members, or shareholders may claim
10and shall provide that information to each of them. Partners, members of limited
11liability companies, and shareholders of tax-option corporations may claim the
12credit in proportion to their ownership interest.
SB62,52,1613 5. If 2 or more persons own and operate the meat processing operation, each
14person may claim a credit under par. (b) in proportion to his or her ownership
15interest, except that the aggregate amount of the credits claimed by all persons who
16own and operate the meat processing operation shall not exceed $200,000.
SB62,52,1917 6. No credit may be allowed under this subsection unless the claimant submits
18with the claimant's return a copy of the claimant's credit certification and allocation
19under s. 560.208.
SB62,52,2120 (d) Administration. 1. Section 71.28 (4) (e), (g), and (h), as it applies to the
21credit under s. 71.28 (4), applies to the credit under this subsection.
SB62,53,222 2. If the allowable amount of the claim under par. (b) exceeds the tax otherwise
23due under s. 71.02 or 71.08, the amount of the claim not used to offset the tax due
24shall be certified by the department of revenue to the department of administration

1for payment by check, share draft, or other draft drawn from the appropriation
2account under s. 20.835 (2) (bd).
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