Amendment SSA1-SB21

SB21-SSA1,658,6 2. For purposes of this paragraph, "Internal Revenue Code" does not include the following provisions of federal public laws for taxable years beginning after December 31, 2013: section 13113 of P.L 103-66; sections 1, 3, 4, and 5 of P.L. 106-519; sections 101, 102, and 422 of P.L 108-357; sections 1310 and 1351 of P.L. 109-58; section 11146 of P.L. 109-59; section 403 (q) of P.L. 109-135; section 513 of P.L. 109-222; sections 104 and 307 of P.L. 109-432; sections 8233 and 8235 of P.L. 110-28; section 11 (e) and (g) of P.L. 110-172; section 301 of P.L. 110-245; sections 15303 and 15351 of P.L. 110-246; section 302 of division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of division C of P.L. 110-343; sections 1232, 1241, 1251, 1501, and 1502 of division B of P.L. 111-5; sections 211, 212, 213, 214, and 216 of P.L. 111-226; sections 2011 and 2122 of P.L. 111-240; sections 753, 754, and 760 of P.L. 111-312; section 1106 of P.L. 112-95; and sections 104, 318, 322, 323, 324, 326, 327, and 411 of P.L. 112-240.

SB21-SSA1,658,10 3. For purposes of this paragraph, "Internal Revenue Code" does not include amendments to the federal Internal Revenue Code enacted after December 31, 2013, except that "Internal Revenue Code" includes the provisions of the following federal public laws:

SB21-SSA1,658,11 a. P.L. 113-97.

SB21-SSA1,658,12 b. P.L. 113-159.

SB21-SSA1,658,13 c. P.L. 113-168.

SB21-SSA1,658,14 d. Section 302901 of P.L. 113-287.

SB21-SSA1,658,15 e. Sections 171, 172, and 201 to 221 of P.L. 113-295.

SB21-SSA1,658,16 f. Sections 102, 105, and 207 of division B of P.L. 113-295.

SB21-SSA1,658,19 4. For purposes of this paragraph, the provisions of federal public laws that directly or indirectly affect the Internal Revenue Code, as defined in this paragraph, apply for Wisconsin purposes at the same time as for federal purposes.

SB21-SSA1,2117e Section 2117e. 71.05 (2) of the statutes is amended to read:

SB21-SSA1,659,6 71.05 (2) Nonresident reciprocity. All payments received by natural persons domiciled outside Wisconsin who derive income from the performance of personal services in Wisconsin shall be excluded from Wisconsin gross income to the extent that it is subjected to an income tax imposed by the state of domicile; provided that the law of the state of domicile allows a similar exclusion of income from personal services earned in such state by natural persons domiciled in Wisconsin, or a credit against the tax imposed by such state on such income equal to the Wisconsin tax on such income. With regard to any agreement that is entered into under this subsection on or after the effective date of this subsection .... [LRB inserts date], such an agreement may not take effect unless it is approved by the joint committee on finance using the procedures authorized under s. 13.101.

SB21-SSA1,2118 Section 2118. 71.05 (6) (a) 15. of the statutes is amended to read:

SB21-SSA1,659,14 71.05 (6) (a) 15. Except as provided under s. 71.07 (3p) (c) 5., the amount of the credits computed under s. 71.07 (2dd), (2de), (2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3s), (3t), (3w), (3y), (4k), (4n), (5e), (5f), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), and (8r) and not passed through by a partnership, limited liability company, or tax-option corporation that has added that amount to the partnership's, company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1k) (g).

SB21-SSA1,2118d Section 2118d. 71.05 (6) (a) 26. a. of the statutes is amended to read:

SB21-SSA1,659,21 71.05 (6) (a) 26. a. To the extent that the receipt of such amounts by the owner or beneficiary of the account results in a penalty as provided in 26 USC 529 (c) (6), any amount that was not used for qualified higher education expenses, as that term is defined in 26 USC 529 (e) (3), and was contributed to the account after December 31, 2013., except that this subd. 26. a. applies only to amounts for which a subtraction was made under par. (b) 32.

SB21-SSA1,2118dd Section 2118dd. 71.05 (6) (a) 26. c. of the statutes is created to read:

SB21-SSA1,660,3 71.05 (6) (a) 26. c. To the extent that an amount is not otherwise added back under this subdivision, any amount withdrawn from a college savings account, as described in s. 16.641, for any purpose if the withdrawn amount was contributed to the account within 365 days of the day on which the amount was withdrawn from such an account and if the withdrawn amount was previously subtracted under par. (b) 32.

SB21-SSA1,2118e Section 2118e. 71.05 (6) (a) 27. of the statutes is created to read:

SB21-SSA1,660,10 71.05 (6) (a) 27. Except as provided in subd. 28., any accumulated interest, dividends, or other gain that accrues from an account described under s. 16.643 during the taxable year in which a withdrawal occurs from such an account if any amount of the money or other assets in the account is withdrawn by, or at the direction of, an account owner for any reason other than the payment of qualified expenses, as defined in s. 16.643 (1) (e), for the account beneficiary.

SB21-SSA1,2118f Section 2118f. 71.05 (6) (a) 28. of the statutes is created to read:

SB21-SSA1,660,14 71.05 (6) (a) 28. Upon the termination of an account under s. 16.643 (3) (d), any amount in the account that is returned to an account owner, or an account owner's estate.

SB21-SSA1,2119 Section 2119. 71.05 (6) (b) 11. of the statutes is repealed.

SB21-SSA1,2123g Section 2123g. 71.05 (6) (b) 32. (intro.) of the statutes is amended to read:

SB21-SSA1,660,23 71.05 (6) (b) 32. (intro.) An amount paid into a college savings account, as described in s. 16.641, in the taxable year in which the contribution is made or on or before the 15th day of the 4th month beginning after the close of a taxpayer's taxable year to which this subtraction relates, by the owner of the account or by any other individual, for the benefit of any beneficiary of an account, calculated as follows, except that each amount that is subtracted under this subdivision may be subtracted only once:

SB21-SSA1,2123gc Section 2123gc. 71.05 (6) (b) 32. ae. of the statutes is created to read:

SB21-SSA1,661,4 71.05 (6) (b) 32. ae. No carryover that would otherwise be authorized under this subdivision may be allowed if the carryover amount was withdrawn from an account for any purpose and the withdrawal occurred within 365 days of the day on which the amount was contributed to the account.

SB21-SSA1,2123gd Section 2123gd. 71.05 (6) (b) 32. am. of the statutes is created to read:

SB21-SSA1,661,10 71.05 (6) (b) 32. am. Any carryover amount that is otherwise eligible for a subtraction under this subdivision shall be reduced by an amount equal to the amount of a withdrawal from an account that was not used for qualified higher education expenses, as that term is defined in 26 USC 529 (e) (3), to the extent that the withdrawn amount exceeds the amount that is added to income under par. (a) 26.

SB21-SSA1,2123gg Section 2123gg. 71.05 (6) (b) 32m. of the statutes is created to read:

SB21-SSA1,661,18 71.05 (6) (b) 32m. Consistent with the limitations specified in subd. 32., for rollovers occurring after April 15, 2015, any principal amount rolled over to a college savings account, as described in s. 16.641, from another state's qualified tuition program, as described in 26 USC 529 (c) (3) (C) (i). Amounts eligible for the subtraction under this subdivision that are in excess of the annual limits specified under subd. 32. may be carried forward to future taxable years of the taxpayer without limitation, other than the limits specified in subd. 32. ae. and am.

SB21-SSA1,2123m Section 2123m. 71.05 (6) (b) 44. of the statutes is amended to read:

SB21-SSA1,661,23 71.05 (6) (b) 44. For taxable years beginning after December 31, 2006, and ending before January 1, 2015, the amount of any incentive payment received by an individual under s. 23.33 (5r), 2013 stats., in the taxable year to which the claim relates.

SB21-SSA1,2124 Section 2124. 71.05 (6) (b) 47. b. of the statutes is amended to read:

SB21-SSA1,662,21 71.05 (6) (b) 47. b. With respect to partners and members of limited liability companies, for taxable years beginning after December 31, 2010, and before January 1, 2014, for 2 consecutive taxable years beginning with the taxable year in which the partnership's or limited liability company's business locates to this state from another state or another country and begins doing business in this state, as defined in s. 71.22 (1r), and subject to the limitations provided under subd. 47. d., dm., and e., the partner's or member's distributive share of taxable income as calculated under section 703 of the Internal Revenue Code; plus the items of income and gain under section 702 of the Internal Revenue Code, including taxable state and municipal bond interest and excluding nontaxable interest income or dividend income from federal government obligations; minus the items of loss and deduction under section 702 of the Internal Revenue Code, except items that are not deductible under s. 71.21; plus guaranteed payments to partners under section 707 (c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de), (2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3s), (3t), (3w), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), and (8r); and plus or minus, as appropriate, transitional adjustments, depreciation differences, and basis differences under s. 71.05 (13), (15), (16), (17), and (19), multiplied by the apportionment fraction determined in s. 71.04 (4) and subject to s. 71.04 (7) or by separate accounting. No amounts subtracted under this subd. 47. b. may be included in the modification under par. (b) 9. or 9m.

SB21-SSA1,2124d Section 2124d. 71.05 (6) (b) 47m. of the statutes is amended to read:

SB21-SSA1,663,17 71.05 (6) (b) 47m. An amount equal to the increase in the number of full-time equivalent employees employed by the taxpayer in this state during the taxable year, multiplied by $4,000 for a business with gross receipts of no greater than $5,000,000 in the taxable year or $2,000 for a business with gross receipts greater than $5,000,000 in the taxable year. For purposes of this subdivision, the increase in the number of full-time equivalent employees employed by the taxpayer in this state during the taxable year is determined by subtracting from the number of full-time equivalent employees employed by the taxpayer in this state during the taxable year, as determined by computing the average employee count from the taxpayer's quarterly unemployment insurance reports or other information as required by the department for the taxable year, the number of full-time equivalent employees employed by the taxpayer in this state during the immediately preceding taxable year, as determined by computing the average employee count from the taxpayer's quarterly unemployment insurance reports or other information as required by the department for the immediately preceding taxable year. No person may claim a deduction under this subdivision if the person may claim a deduction under this subchapter based on the person relocating the person's business from another state to this state and in an amount equal to the person's tax liability. No person may claim a deduction under this subdivision for taxable years beginning after December 31, 2014. The department shall promulgate rules to administer this subdivision.

SB21-SSA1,2124e Section 2124e. 71.05 (6) (b) 52. of the statutes is created to read:

SB21-SSA1,663,22 71.05 (6) (b) 52. Subject to the limits under s. 16.643 (3) (c) 1. and 2., any amount that is deposited by an account owner or any other person into an account described under s. 16.643, and any interest, dividends, or other gain that accrues in the account if the interest, dividends, or other gain is redeposited into the account.

SB21-SSA1,2124s Section 2124s. 71.05 (22) (dp) of the statutes is renumbered 71.05 (22) (dp) 1. and amended to read:

SB21-SSA1,665,5 71.05 (22) (dp) 1. Deduction limits, 2000 and thereafter. Except as provided in par. (f), and subject to subd. 2., for taxable years beginning after December 31, 1999, the Wisconsin standard deduction is whichever of the following amounts is appropriate. For a single individual who has a Wisconsin adjusted gross income of less than $10,380, the standard deduction is $7,200. For a single individual who has a Wisconsin adjusted gross income of at least $10,380, the standard deduction is the amount obtained by subtracting from $7,200 12% of Wisconsin adjusted gross income in excess of $10,380 but not less than $0. For a head of household who has a Wisconsin adjusted gross income of less than $10,380, the standard deduction is $9,300. For a head of household who has a Wisconsin adjusted gross income of at least $10,380, the standard deduction is the amount obtained by subtracting from $9,300 22.515% of Wisconsin adjusted gross income in excess of $10,380, but not less than $0, until the adjusted gross income amount at which the standard deduction is equal to the standard deduction for a single individual at the same adjusted gross income amount. For a head of household who has a Wisconsin adjusted gross income of more than this amount, the standard deduction shall be calculated as if the head of household were a single individual. For a married couple filing jointly that has an aggregate Wisconsin adjusted gross income of less than $14,570, the standard deduction is $12,970. For a married couple filing jointly that has an aggregate Wisconsin adjusted gross income of at least $14,570, the standard deduction is the amount obtained by subtracting from $12,970 19.778% of aggregate Wisconsin adjusted gross income in excess of $14,570 but not less than $0. For a married individual filing separately who has a Wisconsin adjusted gross income of less than $6,920, the standard deduction is $6,160. For a married individual filing separately who has a Wisconsin adjusted gross income of at least $6,920, the standard deduction is the amount obtained by subtracting from $6,160 19.778% of Wisconsin adjusted gross income in excess of $6,920 but not less than $0. The secretary of revenue shall prepare a table under which deductions under this paragraph subdivision shall be determined. That table shall be published in the department's instructional booklets.

SB21-SSA1,2124sc Section 2124sc. 71.05 (22) (dp) 2. of the statutes is created to read:

SB21-SSA1,665,22 71.05 (22) (dp) 2. Except as provided in par. (f), for taxable years beginning after December 31, 2015, the Wisconsin standard deduction is whichever of the following amounts is appropriate. For a married couple filing jointly that has an aggregate Wisconsin adjusted gross income of less than $21,360, the standard deduction is $19,010. For a married couple filing jointly that has an aggregate Wisconsin adjusted gross income of at least $21,360, the standard deduction is the amount obtained by subtracting from $19,010 19.778 percent of aggregate Wisconsin adjusted gross income in excess of $21,360 but not less than $0. For a married individual filing separately who has a Wisconsin adjusted gross income of less than $10,140, the standard deduction is $9,030. For a married individual filing separately who has a Wisconsin adjusted gross income of at least $10,140, the standard deduction is the amount obtained by subtracting from $9,030 19.778 percent of Wisconsin adjusted gross income in excess of $10,140 but not less than $0. The secretary of revenue shall prepare a table under which deductions under this subdivision shall be determined. That table shall be published in the department's instructional booklets.

SB21-SSA1,2124se Section 2124se. 71.05 (22) (dt) of the statutes is amended to read:

SB21-SSA1,666,16 71.05 (22) (dt) Standard deduction indexing, 2001 and thereafter. For taxable years beginning after December 31, 2000, the dollar amounts of the standard deduction that is allowable under par. (dp) and all of the dollar amounts of Wisconsin adjusted gross income under par. (dp) shall be increased each year by a percentage equal to the percentage change between the U.S. consumer price index for all urban consumers, U.S. city average, for the month of August of the previous year and the U.S. consumer price index for all urban consumers, U.S. city average, for the month of August 1999, as determined by the federal department of labor, except that for taxable years beginning after December 31, 2011, the adjustment may occur only if the resulting amount is greater than the corresponding amount that was calculated for the previous year, and except that the base year for the adjustments to the dollar amounts of the standard deduction and all of the dollar amounts of Wisconsin adjusted gross income under par. (dp) 2. shall be 2015. Each amount that is revised under this paragraph shall be rounded to the nearest multiple of $10 if the revised amount is not a multiple of $10 or, if the revised amount is a multiple of $5, such an amount shall be increased to the next higher multiple of $10. The department of revenue shall annually adjust the changes in dollar amounts required under this paragraph and incorporate the changes into the income tax forms and instructions.

SB21-SSA1,2125 Section 2125. 71.07 (2dd) of the statutes is repealed.

SB21-SSA1,2126 Section 2126. 71.07 (2de) of the statutes is repealed.

SB21-SSA1,2127 Section 2127. 71.07 (2di) of the statutes is repealed.

SB21-SSA1,2128 Section 2128. 71.07 (2dj) of the statutes is repealed.

SB21-SSA1,2129 Section 2129. 71.07 (2dL) of the statutes is repealed.

SB21-SSA1,2138 Section 2138. 71.07 (2dr) of the statutes is repealed.

SB21-SSA1,2139 Section 2139. 71.07 (2ds) of the statutes is repealed.

SB21-SSA1,2141 Section 2141. 71.07 (2dx) (a) 3. of the statutes is amended to read:

SB21-SSA1,667,7 71.07 (2dx) (a) 3. "Environmental remediation" means removal or containment of environmental pollution, as defined in s. 299.01 (4), and restoration of soil or groundwater that is affected by environmental pollution, as defined in s. 299.01 (4), in a brownfield if that removal, containment or restoration fulfills the requirement under sub. (2de) (a) 1., 2013 stats., and investigation unless the investigation determines that remediation is required and that remediation is not undertaken.

SB21-SSA1,2143 Section 2143. 71.07 (2dx) (a) 5. of the statutes is amended to read:

SB21-SSA1,667,22 71.07 (2dx) (a) 5. "Member of a targeted group" means a person who resides in an area designated by the federal government as an economic revitalization area, a person who is employed in an unsubsidized job but meets the eligibility requirements under s. 49.145 (2) and (3) for a Wisconsin Works employment position, a person who is employed in a trial job, as defined in s. 49.141 (1) (n), 2011 stats., or in a trial employment match program job, as defined in s. 49.141 (1) (n), a person who is eligible for child care assistance under s. 49.155, a person who is a vocational rehabilitation referral, an economically disadvantaged youth, an economically disadvantaged veteran, a supplemental security income recipient, a general assistance recipient, an economically disadvantaged ex-convict, a qualified summer youth employee, as defined in 26 USC 51 (d) (7), a dislocated worker, as defined in 29 USC 2801 (9), or a food stamp recipient, if the person has been certified in the manner under sub. (2dj) (am) 3., 2013 stats, by a designated local agency, as defined in sub. (2dj) (am) 2., 2013 stats.

SB21-SSA1,2144b Section 2144b. 71.07 (2dx) (b) 4. of the statutes is amended to read:

SB21-SSA1,668,5 71.07 (2dx) (b) 4. The amount determined by multiplying the amount determined under s. 238.385 (1) (bm) or s. 560.785 (1) (bm), 2009 stats., by the number of full-time jobs retained, as provided in the rules under s. 238.385 or s. 560.785, 2009 stats., excluding jobs for which a credit has been claimed under sub. (2dj), in an enterprise development zone under s. 238.397 or s. 560.797, 2009 stats., and for which significant capital investment was made and by then subtracting the subsidies paid under s. 49.147 (3) (a) for those jobs.

SB21-SSA1,2144c Section 2144c. 71.07 (2dx) (b) 5. of the statutes is amended to read:

SB21-SSA1,668,12 71.07 (2dx) (b) 5. The amount determined by multiplying the amount determined under s. 238.385 (1) (c) or s. 560.785 (1) (c), 2009 stats., by the number of full-time jobs retained, as provided in the rules under s. 238.385 or s. 560.785, 2009 stats., excluding jobs for which a credit has been claimed under sub. (2dj), in a development zone and not filled by a member of a targeted group and by then subtracting the subsidies paid under s. 49.147 (3) (a) for those jobs.

SB21-SSA1,2149 Section 2149. 71.07 (2dx) (e) of the statutes is renumbered 71.07 (2dx) (e) 1. and amended to read:

SB21-SSA1,668,19 71.07 (2dx) (e) 1. Section 71.28 (4) (e) to (h), as it applies to the credit under s. 71.28 (4), applies to the credit under this subsection. Subsection (2dj) (c), as it applies to the credit under sub. (2dj), applies to the credit under this subsection. Claimants shall include with their returns a copy of their certification for tax benefits and a copy of the department of commerce's verification of their expenses.

SB21-SSA1,2150 Section 2150. 71.07 (2dx) (e) 2. of the statutes is created to read:

SB21-SSA1,669,4 71.07 (2dx) (e) 2. The credit under this subsection may not be claimed by partnerships, limited liability companies and tax-option corporations but the eligibility for, and the amount of, that credit shall be determined on the basis of their economic activity, not that of their shareholders, partners or members. The corporation, partnership or limited liability company shall compute the amount of credit that may be claimed by each of its shareholders, partners or members and shall provide that information to each of its shareholders, partners or members. That credit may be claimed by partners, members of limited liability companies and shareholders of tax-option corporations in proportion to their ownership interests.

SB21-SSA1,2183 Section 2183. 71.07 (3y) of the statutes is created to read:

SB21-SSA1,669,6 71.07 (3y) Business development credit. (a) Definitions. In this subsection:

SB21-SSA1,669,7 1. "Claimant" means a person certified to receive tax benefits under s. 238.308.

SB21-SSA1,669,8 2. "Eligible employee" has the meaning given in s. 238.308 (1) (a).

SB21-SSA1,669,11 (b) Filing claims. Subject to the limitations provided in this subsection and s. 238.308, for taxable years beginning after December 31, 2015, a claimant may claim as a credit against the tax imposed under ss. 71.02 and 71.08 all of the following:

SB21-SSA1,669,14 1. The amount of wages that the claimant paid to an eligible employee in the taxable year, not to exceed 10 percent of such wages, as determined by the Wisconsin Economic Development Corporation under s. 238.308.

SB21-SSA1,669,19 2. In addition to any amount claimed for an eligible employee under subd. 1., the amount of wages that the claimant paid to the eligible employee in the taxable year, not to exceed 5 percent of such wages, if the eligible employee is employed in an economically distressed area, as determined by the Wisconsin Economic Development Corporation.

SB21-SSA1,669,22 3. The amount of training costs that the claimant incurred under s. 238.308 (4) (a) 3., not to exceed 50 percent of such costs, as determined by the Wisconsin Economic Development Corporation.

SB21-SSA1,670,2 4. The amount of the personal property investment, not to exceed 3 percent of such investment, and the amount of the real property investment, not to exceed 5 percent of such investment, in a capital investment project that satisfies s. 238.308 (4) (a) 4., as determined by the Wisconsin Economic Development Corporation.

SB21-SSA1,670,9 5. An amount, as determined by the Wisconsin Economic Development Corporation under s. 238.308 (4) (a) 5., equal to a percentage of the amount of wages that the claimant paid to an eligible employee in the taxable year if the position in which the eligible employee was employed was created or retained in connection with the claimant's location or retention of the claimant's corporate headquarters in Wisconsin and the job duties associated with the eligible employee's position involve the performance of corporate headquarters functions.

SB21-SSA1,670,17 (c) Limitations. 1. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and the amount of, the credit are based on their payment of amounts under par. (b). A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their ownership interests.

SB21-SSA1,670,20 2. No credit may be allowed under this subsection unless the claimant includes with the claimant's return a copy of the claimant's certification for tax benefits under s. 238.308.

SB21-SSA1,670,22 (d) Administration. 1. Section 71.28 (4) (e), (g), and (h), as it applies to the credit under s. 71.28 (4), applies to the credit under this subsection.

SB21-SSA1,671,2 2. If the allowable amount of the claim under par. (b) exceeds the tax otherwise due under ss. 71.02 and 71.08, the amount of the claim not used to offset the tax due shall be certified by the department of revenue to the department of administration for payment by check, share draft, or other draft drawn from the appropriation account under s. 20.835 (2) (bg).

SB21-SSA1,2184 Section 2184. 71.07 (4k) (b) 1. of the statutes is amended to read:

SB21-SSA1,671,23 71.07 (4k) (b) 1. Subject to the limitations provided in this subsection, and except as provided in subds. 2. and 3., for taxable years beginning after December 31, 2012, and before January 1, 2015, an individual, a partner of a partnership, a shareholder of a tax-option corporation, or a member of a limited liability company may claim a credit against the tax imposed under s. 71.02 or 71.08, as allocated under par. (d), an amount equal to 5 percent of the amount obtained by subtracting from the individual's, partnership's, tax-option corporation's, or limited liability company's qualified research expenses, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses incurred by the individual, partnership, tax-option corporation, or the limited liability company, incurred for research conducted in this state for the taxable year, except that a taxpayer may elect the alternative computation under section 41 (c) (4) of the Internal Revenue Code and that election applies until the department permits its revocation, except as provided in par. (c), and except that "qualified research expenses" does not include compensation used in computing the credit under subs. (2dj) and sub. (2dx), the entity's base amount, as defined in section 41 (c) of the Internal Revenue Code, except that gross receipts used in calculating the base amount means gross receipts from sales attributable to Wisconsin under ss. 71.04 (7) (b) 1. and 2., (df), (dh), (dj), and (dk). Section 41 (h) of the Internal Revenue Code does not apply to the credit under this subdivision.

SB21-SSA1,2185 Section 2185. 71.07 (4k) (b) 2. of the statutes is amended to read:

SB21-SSA1,672,22 71.07 (4k) (b) 2. For taxable years beginning after December 31, 2012, and before January 1, 2015, an individual, a partner of a partnership, a shareholder of a tax-option corporation, or a member of a limited liability company may claim a credit against the tax imposed under s. 71.02 or 71.08, as allocated under par. (d), an amount equal to 10 percent of the amount obtained by subtracting from the individual's, partnership's, tax-option corporation's, or limited liability company's qualified research expenses, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses incurred by the individual, partnership, tax-option corporation, or limited liability company for research related to designing internal combustion engines for vehicles, including expenses related to designing vehicles that are powered by such engines and improving production processes for such engines and vehicles, incurred for research conducted in this state for the taxable year, except that a taxpayer may elect the alternative computation under section 41 (c) (4) of the Internal Revenue Code and that election applies until the department permits its revocation, except as provided in par. (c), and except that "qualified research expenses" does not include compensation used in computing the credit under subs. (2dj) and sub. (2dx), the entity's base amount, as defined in section 41 (c) of the Internal Revenue Code, except that gross receipts used in calculating the base amount means gross receipts from sales attributable to Wisconsin under ss. 71.04 (7) (b) 1. and 2., (df), (dh), (dj), and (dk). Section 41 (h) of the Internal Revenue Code does not apply to the credit under this subdivision.

SB21-SSA1,2186 Section 2186. 71.07 (4k) (b) 3. of the statutes is amended to read:

SB21-SSA1,673,20 71.07 (4k) (b) 3. For taxable years beginning after December 31, 2012, and before January 1, 2015, an individual, a partner of a partnership, a shareholder of a tax-option corporation, or a member of a limited liability company may claim a credit against the tax imposed under s. 71.02 or 71.08, as allocated under par. (d), an amount equal to 10 percent of the amount obtained by subtracting from the individual's, partnership's, tax-option corporation's, or limited liability company's qualified research expenses, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses incurred by the individual, partnership, tax-option corporation, or limited liability company for research related to the design and manufacturing of energy efficient lighting systems, building automation and control systems, or automotive batteries for use in hybrid-electric vehicles, that reduce the demand for natural gas or electricity or improve the efficiency of its use, incurred for research conducted in this state for the taxable year, except that a taxpayer may elect the alternative computation under section 41 (c) (4) of the Internal Revenue Code and that election applies until the department permits its revocation, except as provided in par. (c), and except that "qualified research expenses" does not include compensation used in computing the credit under subs. (2dj) and sub. (2dx), the entity's base amount, as defined in section 41 (c) of the Internal Revenue Code, except that gross receipts used in calculating the base amount means gross receipts from sales attributable to Wisconsin under ss. 71.04 (7) (b) 1. and 2., (df), (dh), (dj), and (dk). Section 41 (h) of the Internal Revenue Code does not apply to the credit under this subdivision.

SB21-SSA1,2186d Section 2186d. 71.07 (4k) (b) 4. of the statutes is created to read:

SB21-SSA1,674,11 71.07 (4k) (b) 4. a. Except as provided in subds. 5. and 6., for taxable years beginning after December 31, 2014, an individual, a partner of a partnership, a shareholder of a tax-option corporation, or a member of a limited liability company may claim a credit against the tax imposed under s. 71.02 or 71.08, as allocated under par. (d), an amount equal to 5.75 percent of the amount by which the individual's, partnership's, tax-option corporation's, or limited liability company's qualified research expenses for the taxable year exceed 50 percent of the average qualified research expenses for the 3 taxable years immediately preceding the taxable year for which the claimant claims the credit. If the individual, partnership, tax-option corporation, or limited liability company had no qualified research expenses in any of the 3 taxable years immediately preceding the taxable year for which the claimant claims the credit, the claimant may claim an amount equal to 2.875 percent of the individual's, partnership's, tax-option corporation's, or limited liability company's qualified research expenses for the taxable year for which the claimant claims the credit.

SB21-SSA1,674,19 b. For purposes of subd. 4. a. "qualified research expenses" means qualified research expenses as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses incurred by the individual, partnership, tax-option corporation, or the limited liability company, incurred for research conducted in this state for the taxable year and does not include compensation used in computing the credit under sub. (2dx). Section 41 (f) (1), (2), (5), and (6) and (h) of the Internal Revenue Code does not apply to the credit under this subdivision.

SB21-SSA1,2186e Section 2186e. 71.07 (4k) (b) 5. of the statutes is created to read:

SB21-SSA1,675,9 71.07 (4k) (b) 5. a. For taxable years beginning after December 31, 2014, an individual, a partner of a partnership, a shareholder of a tax-option corporation, or a member of a limited liability company may claim a credit against the tax imposed under s. 71.02 or 71.08, as allocated under par. (d), an amount equal to 11.5 percent of the amount by which the individual's, partnership's, tax-option corporation's, or limited liability company's qualified research expenses for the taxable year exceed 50 percent of the average qualified research expenses for the 3 taxable years immediately preceding the taxable year for which the claimant claims the credit. If the individual, partnership, tax-option corporation, or limited liability company had no qualified research expenses in any of the 3 taxable years immediately preceding the taxable year for which the claimant claims the credit, the claimant may claim an amount equal to 5.75 percent of the individual's, partnership's, tax-option corporation's, or limited liability company's qualified research expenses for the taxable year for which the claimant claims the credit.

SB21-SSA1,675,19 b. For purposes of subd. 5. a., "qualified research expenses" means qualified research expenses as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses incurred by the individual, partnership, tax-option corporation, or limited liability company for research related to designing internal combustion engines for vehicles, including expenses related to designing vehicles that are powered by such engines and improving production processes for such engines and vehicles, incurred for research conducted in this state for the taxable year and does not include compensation used in computing the credit under sub. (2dx). Section 41 (f) (1), (2), (5), and (6) and (h) of the Internal Revenue Code does not apply to the credit under this subdivision.