January 2014 Special Session
2013 - 2014 LEGISLATURE
February 4, 2014 - Introduced by
Committee on Assembly Organization, by
request of Governor Scott Walker. Referred to Committee on Jobs, Economy
1An Act to repeal
38.16 (3) (b); to renumber
71.05 (8) (b), 71.10 (4) (cr), 71.10 2
(4) (dr) and 71.10 (4) (er); to amend
38.16 (title), 38.16 (3) (a) 2., 38.16 (3) (be), 3
38.16 (3) (bg) 2., 38.16 (3) (br) 1., 38.16 (3) (br) 2., 38.16 (3) (c) (intro.), 38.16 (3) 4
(c) 1., 38.16 (3) (c) 3., 38.16 (3) (c) 4., 38.16 (3) (d), 71.05 (6) (b) 47. am., 71.05 (6) 5
(b) 47. b., 71.05 (6) (b) 47. c., 71.06 (1q) (a), 71.06 (2) (i) 1., 71.06 (2) (j) 1., 71.07 6
(4k) (b) 1., 71.07 (5m) (a) 4., 71.07 (5n) (b) (intro.), 71.07 (9r) (a), 71.08 (1) (intro.), 7
71.08 (1) (intro.), 71.28 (9s) (d) 3., 71.47 (9s) (d) 3., 71.52 (6), 77.54 (61) (intro.), 8
(a) and (b) and 238.16 (3) (intro.); and to create
20.292 (1) (dp), 38.16 (3) (a) 1m., 9
38.16 (3) (a) 2w., 38.16 (4), 71.05 (6) (b) 47. dm., 71.05 (8) (b) 2., 71.05 (8) (c), 10
71.07 (5i) (c) 3., 71.28 (5i) (c) 3., 71.47 (5i) (c) 3. and 77.54 (61) (c) of the statutes; 11relating to: reducing the lowest individual income tax rate; providing
12technical college property tax relief aid; establishing a technical college district
13revenue limit; the carry-back of net operating losses; the sales and use tax
14exemption for commercial printing; the jobs tax credit; the electronic medical
1records credit; the manufacturing and agriculture credit; the research credit;
2the state historic rehabilitation credit; the relocated business credit; and
3making an appropriation.
Analysis by the Legislative Reference Bureau
Individual Income tax rates
Under current law, there are four income tax brackets for single individuals,
certain fiduciaries, heads of households, and married persons. The brackets are
indexed for inflation. The rate of taxation under current law for the lowest bracket
for single individuals, certain fiduciaries, heads of households, and married persons
is 4.40 percent of taxable income; the rate for the second bracket is 5.84 percent; the
rate for the third bracket is 6.27 percent; and the rate for the highest bracket is 7.65
percent. Before applying bracket indexing, the four brackets for individuals, certain
fiduciaries, and heads of households, to which the above rates apply, are as follows:
taxable income from $0 to $7,500; taxable income exceeding $7,500 but not exceeding
$15,000; taxable income exceeding $15,000 but not exceeding $225,000; and taxable
income exceeding $225,000.
This rate and bracket structure first applies to taxable year 2013, and was
enacted in 2013 Wisconsin Act 20
, the state budget bill.
For taxable years beginning after December 31, 2013, this bill lowers the rate
of taxation for the lowest tax bracket. Under the bill, the rate of taxation for the
lowest bracket for single individuals, certain fiduciaries, heads of households, and
married persons is 4.0 percent of taxable income.
technical college system
This bill provides property tax relief aid to technical college districts,
distributed annually to each district on the basis of its equalized value as compared
to the equalized value of all technical college districts as of January 2014. The first
distribution is in February 2015.
The bill eliminates the current limit on a technical college district's tax levy and
imposes, instead, a revenue limit. Under the bill, with certain exceptions, a district
board's revenue (defined as the sum of its tax levy for operations and the amount of
property tax relief aid it receives) in the 2014-15 school year or any school year
thereafter may not exceed its revenue in the previous school year increased by the
district's valuation factor, which is the percentage change in the district's equalized
value due to new construction, less improvements removed.
net operating losses
Under current law, for income tax purposes, under certain circumstances, a
taxpayer may claim a Wisconsin net operating loss against Wisconsin taxable income
of the two years preceding the year in which the taxpayer sustained the loss. This
bill clarifies that a taxpayer need not make an offset against Wisconsin modified
taxable income of the two years preceding the loss, if the taxpayer chooses not to
carry back the net operating loss to the two years preceding the loss.
Under current law, a person may claim the jobs tax credit if the Wisconsin
Economic Development Corporation certifies the person to receive the tax credit, the
person increases net employment in the person's business, and the person provides
certain wages or job training to its full-time employees. This bill specifies that to be
eligible for the jobs tax credit a person must increase net employment in the person's
business in this state. Therefore, under the bill, a person may qualify for the jobs tax
credit by relocating existing jobs to this state even if the number of individuals the
person's business employs nationwide does not increase. Similarly, under the bill,
a person does not qualify for the jobs tax credit by increasing the number of
individuals the person's business employs nationwide if the number of individuals
the person's business employs in this state does not increase.
Under current law, for income and franchise tax purposes, a taxpayer may not
claim a relocated business deduction or tax credit for taxable years beginning after
December 31, 2013. Under this bill, a taxpayer who is first eligible to claim a
relocated business deduction or tax credit for a taxable year beginning after
December 31, 2012, and before January 1, 2014, may claim the deduction or credit
in the following taxable year.
The bill also provides that the manufacturing and agriculture credit, the
research credit, and the state historic rehabilitation credit may be claimed against
the alternative minimum tax.
Finally, the bill makes technical changes to the electronic medical records tax
credit and to the sales and use tax exemption for tangible personal property used in
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:
20.292 (1) (dp) of the statutes is created to read:
(dp) Property tax relief aid.
A sum sufficient equal to the amount 3
necessary to distribute the property tax relief aid to technical college districts under 4
s. 38.16 (4).
38.16 (title) of the statutes is amended to read:
(title) District tax levy; revenue limit; property tax relief aid.
38.16 (3) (a) 1m. of the statutes is created to read:
38.16 (3) (a) 1m. "Equalized value" excludes the value of tax incremental 2
(a) 2. "Excess levy
" means the amount by which a district 6
board's tax levy revenue
exceeds the limit under this subsection.
38.16 (3) (a) 2w. of the statutes is created to read:
(a) 2w. "Revenue" means the sum of the tax levy and property tax 9
relief aid under sub. (4).
38.16 (3) (b) of the statutes is repealed.
(be) Notwithstanding sub. (1), no district board may increase its tax
in 2013 the 2014-15 school year
or in any school
year thereafter by a 15
percentage that exceeds the district's valuation factor, except as provided in pars. 16
(bg) and (br).
(bg) 2. If a district board's allowable
under this 20
subsection in 2013 the 2014-15 school year
, or any school
year thereafter, is greater 21
than its actual levy revenue
in that school
year, the limit otherwise applicable to the 22
district board under this subsection in the succeeding school
year is increased by the 23
difference between the prior school
and the prior school 24
year's actual levy revenue
, as determined by the department of revenue, up to a
maximum increase of 0.5 percent of the actual levy revenue
in that prior school
if the district board approves the increase by a three-fourths vote.
(br) 1. If a district board wishes to exceed the limit otherwise 6
applicable to the district under this subsection, it shall adopt a resolution supporting 7
inclusion in the final district budget of an amount equal to the proposed excess levy 8revenue
. The resolution shall be filed as provided in s. 8.37. Within 10 days after 9
adopting the resolution, the district board shall notify the board of the scheduled date 10
of the referendum and submit a copy of the resolution to the board. The district board 11
shall call a special referendum for the purpose of submitting the resolution to the 12
electors of the district for approval or rejection. In lieu of a special referendum, the 13
district board may specify that the referendum be held at the next succeeding spring 14
primary or election or partisan primary or general election, if such election is to be 15
held not sooner than 70 days after the filing of the resolution of the district board. 16
The district board shall certify the results of the referendum to the board within 10 17
days after the referendum is held.
38.16 (3) (br) 2. of the statutes is amended to read:
(br) 2. The district board shall publish type A, B, C, D, and E notices 20
of the referendum under s. 10.01 (2). Notwithstanding s. 10.01 (2) (a), the type A 21
notice shall include a statement of the amount of the excess levy revenue
in subd. 1. and a copy of the resolution under subd. 1. Section 5.01 (1) applies in the 23
event of failure to comply with the notice requirements of this subdivision.
(c) (intro.) Except as provided in par. (d), if the board determines that 2
a district board imposed an excess levy exceeded its limit under this subsection
, the 3
board shall do all of the following:
38.16 (3) (c) 1. of the statutes is amended to read:
(c) 1. Reduce the amount of state aid payments to the district board 6
in the school year in which the district board imposed the excess levy exceeded its
by an amount equal to the amount of the excess levy revenue
(c) 3. Ensure that the amount of the excess
is not 11
included in determining the limit under this subsection for the district board for the 12