Tax 11.10(5)(d)
(d) The exemption under sub.
(1) (a) may be claimed by the consumer of the product who purchases the product as tangible personal property. A contractor who will purchase, furnish, and install a product which will become real property when installed is the consumer of the product, and may provide its supplier with a properly completed exemption certificate, claiming the product is exempt under s.
77.54 (56), Stats. A contractor who will furnish and install a product that will remain tangible personal property when installed may purchase a product without tax for resale. The purchaser may then issue the contractor an exemption certificate, claiming the product is exempt under s.
77.54 (56) (a), Stats.
Tax 11.10 Note
Note: See s.
Tax 11.68 (4),
(5), and
(6) for information on the determination of the classification of property after installation.
Tax 11.10(6)
(6)
Exemption for energy produced by a product. Tax 11.10(6)(a)
(a) The exemption under sub.
(1) (b) applies to a direct sale from the producer of electricity or energy to the consumer of the same electricity or energy where all of the following apply:
Tax 11.10(6)(a)1.
1. The electricity or energy is produced by a product that qualifies for exemption under sub.
(1) (a).
Tax 11.10 Note
Note: Section
77.54 (30) (a), Stats., includes an exemption for electricity sold from November through April for residential use, fuel and electricity sold for use in farming, and fuel and electricity consumed in manufacturing tangible personal property in Wisconsin.
Tax 11.10(6)(b)
(b) The exemption under sub.
(1) (b) does not apply to electricity or energy which is first purchased for resale from the producer and is then sold in a subsequent retail sale, unless the person making the retail sale is able to account for the quantity of electricity or energy that qualifies for exemption under s.
77.54 (56) (b), Stats., and is able to identify the person to whom such electricity or heat is sold.
Tax 11.10 Note
Example: Electricity that would otherwise qualify for exemption under s.
77.54 (56) (b), Stats., is commingled in a distribution network with electricity that is not produced by a product whose power source is wind energy, direct radiant energy received from the sun, or gas generated from anaerobic digestion of animal manure and other agricultural wastes. It is not possible to determine to whom, or in what amount, the electricity that qualifies for exemption is sold. A purchaser of this electricity will not be able to provide an exemption certificate to a utility and properly claim what portion of the electricity it has purchased is exempt pursuant to s.
77.54 (56) (b), Stats., nor is it possible for a utility to know what portion of the electricity purchased by the consumer was from eligible sources.
Tax 11.10(6)(c)
(c) The exemption under sub.
(1) (b) does not apply to the sale of, or the storage, use or other consumption of gas produced by the anaerobic digestion of animal manure or other agricultural wastes unless such gas is produced by a product described in sub.
(1) (a).
Tax 11.10 History
History: EmR1110: emerg. cr., eff. 6-29-11;
CR 11-052: cr.
Register July 2012 No. 679, eff. 8-1-12.
Tax 11.11
Tax 11.11
Utility, industrial and governmental waste treatment facilities. Tax 11.11(1)(1)
General. Section
77.54 (26), Stats., provides a sales and use tax exemption for tangible personal property and items and property under s.
77.52 (1) (b) and
(c), Stats., which becomes a component part of certain waste treatment facilities.
Tax 11.11(2)
(2)
Utility waste treatment exemption. If a utility waste treatment facility that is taxed under ch.
76, Stats., qualifies for property tax exemption under s.
76.025 (1), Stats., as approved by the department, it qualifies for the sales and use tax exemption under s.
77.54 (26), Stats.
Tax 11.11 Note
Note: Refer to s.
Tax 6.40 for information on how to request approvals for property tax exemption for utility waste treatment facilities. For more information regarding exemptions for waste treatment facilities owned by a utility, including railroads, airlines, and pipelines, approved by the department, write to Wisconsin Department of Revenue, Manufacturing and Utility Bureau, PO Box 8971, Madison WI 53708-8971; telephone (608) 266-3845; send an e-mail to
mfgtelco@wisconsin.gov; or access the department's web site at
www.revenue.wi.gov and search "waste treatment facilities".
Tax 11.11(2m)(a)
(a) An industrial waste treatment facility is any property purchased or constructed as a waste treatment facility used exclusively and directly to remove, store, or cause a physical or chemical change in industrial waste or air contaminants for the purpose of abating or eliminating pollution of surface waters, the air, or waters of the state if that property is not used to grow agricultural products for sale. In this paragraph, “used exclusively" means to the exclusion of all other uses except:
Tax 11.11(2m)(a)2.
2. To produce heat or steam for a manufacturing process, if the fuel consists of either 95% or more industrial waste that would otherwise be considered superfluous, discarded, or fugitive material or 50 percent or more of wood chips, sawdust, or other wood residue from the paper and wood products manufacturing process, if the wood chips, sawdust, or other wood residue would otherwise be considered superfluous, discarded, or fugitive material.
Tax 11.11(2m)(b)
(b) Tangible personal property and items and property under s.
77.52 (1) (b) and
(c), Stats., becoming a component part of an industrial waste treatment facility is exempt from the sales and use tax under s.
77.54 (26), Stats., if the facility qualifies for property tax exemption under s.
70.11 (21), Stats.
Tax 11.11 Note
Note: For information regarding the property tax exemption for industrial waste treatment facilities of manufacturers write or call the district office of the Wisconsin Department of Revenue, Bureau of Manufacturing and Telco Assessments. To locate the district office, write or call Wisconsin Department of Revenue, Bureau of Manufacturing and Telco Assessment, PO Box 8971, Madison WI 53708-8971; telephone (608) 266-1147. The web site is
http://www.revenue.wi.gov/contact/slfbmta.html. To ascertain whether a non-manufacturing property would be exempt under s.
70.11 (21), Stats., owners may refer to the Wisconsin Property Assessment Manual or contact the local property tax assessor.
Tax 11.11(3)
(3)
Municipal waste treatment exemption. Tangible personal property and items and property under s.
77.52 (1) (b) and
(c), Stats., which become a component or ingredient part of municipal facilities that treat waste qualifies for exemption from Wisconsin sales and use tax under s.
77.54 (26), Stats. Municipal facilities that treat waste include:
Tax 11.11(3)(a)1.1. Only the central waste treatment plant which actually treats the sewage qualifies for the exemption.
Tax 11.11(3)(a)2.
2. Storm sewers, water supply systems and private domestic waste water facilities do not qualify for the sales and use tax exemption.
Tax 11.11(3)(a)3.
3. The collection system throughout the area served by the treatment facility, the effluent pipeline carrying the treated sewage away from the central treatment plant, earthen dikes, and chain link fences on the boundary of a treatment plant, and dredge material disposal sites are not exempt. The collection systems includes the lift stations, force mains, and associated pumping equipment used to bring the raw sewage to the central treatment plant.
Tax 11.11(3)(b)1.1. A facility constructed by a municipality to meet mandates of ch.
287, Stats., regarding the reuse, recycling, and recovery of waste material to reduce the need for waste disposal is exempt if the activities include all of the following:
Tax 11.11(3)(b)1.b.
b. Processing recyclable materials which may include removing contaminants, baling paper, shredding paper, pelletizing plastics, and crushing glass.
Tax 11.11(3)(b)2.
2. The exemption does not apply if the only activities performed are sorting and storing and no processing of the materials takes place.
Tax 11.11(3)(c)
(c) Sanitary landfill. A sanitary landfill, including the treatment equipment, such as the collection and burner system, laboratory equipment, maintenance buildings, garages, office buildings, fences, and gates, qualifies for exemption.
Tax 11.11(3)(d)1.1. A municipal facility constructed to treat hazardous or contaminated groundwater, including oil and water separators, air strippers, aerators, blowers, filters, carbon units, controls, pumps, and thermal oxidizers, qualifies for exemption.
Tax 11.11(3)(d)2.
2. The collection system used to bring the hazardous or contaminated water to the facility and the distribution system used to carry the treated water away from the facility are not exempt.
Tax 11.11 Note
Note: For more information regarding the exemption for municipal treatment facilities, write, email or call Wisconsin Department of Revenue, Customer Service Bureau, Mail Stop 5-77, PO Box 8949, Madison WI 53708-8949, email
dorsalesanduse@wisconsin.gov, telephone (608) 266-2776. The web site is
www.revenue.wi.gov.
Tax 11.11(4)(a)
(a) The repair, service, alteration, cleaning, painting, and maintenance of a utility waste treatment facility described in sub.
(2), an industrial waste treatment facility described in sub.
(2m), and a municipal waste treatment facility described in sub.
(3) as well as the repair parts and replacement for those types of facilities are exempt from the sales and use tax.
Tax 11.11(4)(b)
(b) Chemicals and supplies, including fuel and electricity, used or consumed in operating a utility waste treatment facility described in sub.
(2), an industrial waste treatment facility described in sub.
(2m) and a municipal waste treatment facility described in sub.
(3) are exempt from the sales and use tax.
Tax 11.11(5)(a)
(a) Exempt purchases. The sales and use tax exemption extends to and includes the purchases of tangible personal property and items and property under s.
77.52 (1) (b) and
(c), Stats., by a contractor-installer who incorporates the property into an approved utility waste treatment facility or who incorporates the property into an industrial waste treatment facility or a municipal waste treatment facility. The contractor-installer shall certify the intended exempt use of the item to each supplier in order to relieve the supplier of the duty of collecting and reporting the tax on the sales. Certification of exempt use shall be made on a Wisconsin sales and use tax exemption certificate, form S-211.
Tax 11.11 Note
Note: Form S-211 may be obtained by writing or calling Wisconsin Department of Revenue, P.O. Box 8902, Madison, WI 53708-8902, telephone (608) 266-2776.
Tax 11.11(5)(b)
(b) Taxable purchases. A contractor's purchases of items used or consumed in the performance of the construction contract, and which do not become a component part of the waste treatment facility, are subject to the tax. This includes industrial gases, form lumber, tunnel shields, and supplies used by a contractor during construction. Payments by a contractor for equipment purchased or leased to perform a construction job are also taxable.
Tax 11.11(5)(c)1.1. `Utility property taxed under ch. 76, Stats.' A contractor or subcontractor may be liable for sales and use tax on a purchase of tangible personal property or items or property under s.
77.52 (1) (b) or
(c), Stats., that becomes a component part of a utility waste treatment facility that has not been approved by the department for a property tax exemption under s.
76.025 (1), Stats.
Tax 11.11 Note
Note: Contractors may direct questions concerning the property to the department as provided in sub. (2).
Tax 11.11(5)(c)2.
2. `Industrial property taxed under ch. 70, Stats.' Approvals are not required for industrial waste treatment facilities. A contractor or subcontractor may be liable for sales and use tax on a purchase of tangible personal property or items or property under s.
77.52 (1) (b) or
(c), Stats., that becomes a component part of a facility that is determined to not qualify for a waste treatment facility property tax exemption under s.
70.11 (21), Stats.
Tax 11.11 Note
Note: Contractors may direct questions concerning the taxability of the waste treatment facility to the department as provided in sub. (2m).
Tax 11.11(5)(c)3.
3. `Municipal waste treatment facilities.' Approvals are not required for municipal waste treatment facilities. A contractor or subcontractor may be liable for sales and use tax on a purchase of tangible personal property or items or property under s.
77.52 (1) (b) or
(c), Stats., that becomes a component part of a facility that is determined not to be a municipal waste treatment facility as provided in sub.
(3).
Tax 11.11 Note
Note: Contractors may direct questions concerning the taxability of the waste treatment facility to the department as provided in sub. (2m).
Tax 11.11 Note
Note: The interpretations in s.
Tax 11.11 are effective July 31, 1975 when ss.
70.11 (21) and
77.54 (26), Stats., were revised, except: (a) The exemptions for chemicals and supplies used or consumed in operating a waste treatment facility became effective September 1, 1979, pursuant to
Chapter 39, Laws of 1979; (b) The approval process for property and sales tax exemptions for industrial waste treatment facilities, except utilities, were eliminated effective January 1, 2002, pursuant to
2001 Wis. Act 16; (c) The definition of an industrial waste treatment facility was amended pursuant to
2007 Wis. Act 19 and applies on and after October 1, 2007; and (d) The separate impositions of tax on coins and stamps sold above face value under s.
77.52 (1) (b), Stats., certain leased property affixed to real property under s.
77.52 (1) (c), Stats., and digital goods under s.
77.52 (1) (d), Stats., became effective October 1, 2009, pursuant to
2009 Wis. Act 2.
Tax 11.11 History
History: Cr.
Register, March, 1979, No. 279, eff. 4-1-79; am. (2), (4) (b) and (5) (d), r. and recr. (3),
Register, September, 1982, No. 321, eff. 10-1-82; am. (2) (b), (3) (a) and (b) and (5) (b),
Register, September, 1984, No. 345, eff. 10-1-84; cr. (2) (c), r. (1) (b) and (3), renum. (1) (a) to be (1) and am., renum. (2) (a), (b) and (c) to be (4) (a), (c) and (b) and am., renum. (4) to be (2) and am. (2) (a) and (b), renum. (5) (a), (b), (c) and (d) to be (3) (b), (a), (c) and (d),
Register, June, 1991, No. 426, eff. 7-1-91; correction in (2) (a) made under s. 13.93 (2m) (b) 7., Stats.,
Register, August, 1999, No. 524; am. (2) (b), r. (2) (c), cr. (3) (intro.), (b), (c) and (d), renum. (3) (a) to (d) and (4) to be (3) (a) 1., 2. and 3, (4) and (5) and am. (4) and (5) (c),
Register, October, 1999, No. 526, eff. 11-1-99;
CR 02-053: renum. (2) (a) and (4) to be (2) and (4) (a) and am., r. (2) (b), cr. (2m) and (4) (b), am. (5) (a), r. and recr. (5) (c)
Register November 2002 No. 563, eff. 12-1-02;
EmR0924: emerg. am. (1), (2m) (b), (3) (intro.), (5) (a), (c) 1. to 3., renum. (2m) (a) to be (2m) (a) (intro.) and am., cr. (2m) (a) 1. and 2., eff. 10-1-09;
CR 09-090: am. (1), (2m) (b), (3) (intro.), (5) (a), (c) 1. to 3., renum. (2m) (a) to be (2m) (a) (intro.) and am., cr. (2m) (a) 1. and 2.
Register May 2010 No. 653, eff. 6-1-10;
CR 10-094: am. (3) (a) 3., (b) 1. (intro.), b., (c), (d) 1., (4) (a), (5) (b)
Register November 2010 No. 659, eff. 12-1-10;
CR 16-053: am. (3) (intro.)
Register June 2018 No. 750, eff. 7-1-18.
Tax 11.12
Tax 11.12
Farming, including dairy farming, agriculture, horticulture, floriculture, silviculture, and custom farming services. Tax 11.12(1)(1)
Statutes. Section
77.54 (3) and
(3m), Stats., provides exemptions for certain sales of tangible personal property, or items or property under s.
77.52 (1) (b) or
(c), Stats., to persons who are engaged in farming as a business enterprise, including dairy farming, agriculture, horticulture, floriculture, silviculture, beekeeping, and custom farming services.
Tax 11.12(2)(a)
(a) “Animal bedding" used in farming means disposable loose materials, including straw, shavings, sawdust, leaves, sand, and shredded paper, used where an animal may lie, to promote cleanliness and absorb urine or liquid manure. It does not include nonabsorbent items, including rubber floor mats.
Tax 11.12(2)(b)
(b) “Custom farming services" means the performance of an activity, defined as farming in this section, for a farmer for a fee. The fee may include a cash payment, a share of the harvest or other valuable consideration. “Custom farming services" also includes services performed by a veterinarian to animals that are farm livestock or farm work stock used exclusively in the business of farming.
Tax 11.12(2)(c)
(c) “Dairy farming" means the business of feeding and raising cattle and other milk producing animals, but does not include operations such as pasteurizing, homogenizing, or making butter, cheese, or ice cream.
Tax 11.12(2)(d)
(d) “Farm livestock drugs" means any substance or preparation used in the diagnosis, cure, mitigation, treatment, or prevention of disease in farm livestock. This includes antibiotics, dewormers, mastitis treatments, medicated shampoos and vaccines in the form of boluses, capsules, feed additives, fluids, pills, powders, ointments, and salves. This also includes disinfectants, flea powder and flea sprays, mastitis indicators, teat dips, udder wash, and vitamins. “Farm livestock drug" does not include drugs for work stock, horses used in racing, pleasure riding, or show, or small domestic animals, including dogs and cats. It also does not include laboratory equipment used by a veterinarian, non-medicated shampoos, non-medicated pet foods, and non-medicated bandages, or plaster of paris that is used to set an animal's broken bone.
Tax 11.12(2)(e)
(e) “Farm work stock" means animals, such as draft horses and mules, which are used exclusively in farming. The phrase includes horses used exclusively in farming to check on or herd livestock. The phrase does not include dogs, horses used for racing, pleasure riding or show or laboratory animals. The food for animals which are not farm work stock is taxable unless the animals are livestock as defined in par.
(j).
Example: Dog and cat food is taxable.
Tax 11.12(2)(f)
(f) “Farming" means the business of producing food products or other useful crops by tilling and cultivating the soil or by raising cattle, sheep, llamas, poultry, domesticated rabbits, or other animals which produce a food product or which are themselves a food product. In addition, consistent with chs.
29 and
94, Stats., “farming" includes raising earthworms, pheasants, foxes, fitch, nutria, marten, fisher, mink, chinchilla, rabbit, caracul, and bees; producing honey products by a beekeeper; commercial raising of fish for food; commercial breeding and raising of horses and llamas for sale; and raising ginseng, mushrooms, and sod. “Farming" does not include home gardening and other similar noncommercial activities; breeding or raising dogs, cats, other pets or animals intended for use in laboratories; operating sporting or recreational facilities, such as riding stables or shooting preserves; operating stockyards, slaughterhouses, or feed lots as described in par.
(g); pulpwood and sawmill operations; milling and grinding grain; and preparing sausage, canned goods, jellies, juices, or syrup.
Tax 11.12 Note
Example: Dog and cat food is taxable.
Tax 11.12(2)(g)
(g) “Feed lot" means a restricted area containing pens or lots where livestock are held and fed. A person who holds livestock in a feed lot for less than 30 days is not engaged in farming. Feed purchased for livestock held in a feed lot for less than 30 days is taxable. However, a person who holds livestock in a feed lot for 30 days or more is engaged in farming and the feed purchased for the livestock is exempt. If a person holds some livestock for less than 30 days and some livestock for 30 days or more and purchases feed for both types at the same time, an allocation of the feed costs may be made so that tax is paid on the feed consumed by livestock held for less than 30 days and is not paid on feed consumed by livestock held for 30 days or more.
Tax 11.12(2)(h)
(h) “Floriculture" means the business of producing flowers, Christmas trees or other decorative trees, plants, or shrubs, including such operations as greenhouses.
Tax 11.12(2)(i)
(i) “Horticulture" means the business of producing vegetables, vegetable plants, fruits, and nursery stock, including the operation of commercial nurseries and orchards but not businesses which hold stock for purposes other than propagation or growth. “Horticulture" does not include the business of servicing plants owned by others; the raising of trees as timber; or lumber or sawmill operations.
Tax 11.12(2)(j)
(j) “Livestock" and “poultry" include animals, the products of which are normally used as food for human consumption, and domestically raised fur bearing animals or animals which are a source of wool, such as llamas, including those purchased for breeding.
Tax 11.12(2)(k)1.1. “Silviculture" means the business of raising trees for timber, lumber, or other wood products. Silviculture includes the logging of timber when it is performed by a person engaged in the business of silviculture and the logging is conducted with respect to that person's silviculture activity. Silviculture does not include pulp or sawmill operations.
Tax 11.12(2)(k)2.
2. “Logging" as used in subd.
1. includes the following activities which occur while in the field:
Tax 11.12(2)(k)2.e.
e. Activities conducted in the forest incidental to the felling, cutting, and removal of trees from the forest such as the clearing of the forest to allow access to and removal of the timber from the forest land.
Tax 11.12(3)
(3)
Obtaining exemption certificates. A retailer shall have a signed exemption certificate for every exempt sale made to a farmer, except that if the exemption certificate is received electronically, a signature is not required. Every invoice to which the certificate refers must contain the seller's name, the farmer's name and address, the date of sale and a brief description of the product sold.
Tax 11.12(4)(a)(a) Section
77.54 (3) (a), Stats., exempts the sales price from the sales of and the storage, use, or other consumption of tractors and machines, including accessories, attachments, and parts, lubricants, nonpowered equipment, and other tangible personal property or items or property under s.
77.52 (1) (b) or
(c), Stats., that are used exclusively and directly, or are consumed or lose their identities, in the business of farming, including dairy farming, agriculture, horticulture, floriculture, silviculture, beekeeping, and custom farming services, but excluding automobiles, trucks, and other motor vehicles for highway use; excluding personal property that is attached to, fastened to, connected to or built into real property or that becomes an addition to, component of or capital improvement of real property and excluding tangible personal property or items or property under s.
77.52 (1) (b) or
(c), Stats., used or consumed in the erection of buildings or in the alteration, repair, or improvement of real property, regardless of any contribution that that personal property, or item or property under s.
77.52 (1) (b) or
(c), Stats., makes to the production process in that building or real property and regardless of the extent to which that personal property, or item or property under s.
77.52 (1) (b) or
(c), Stats., functions as a machine, except as provided in subd.
4. d. For purposes of this section:
Tax 11.12(4)(a)1.
1. `Directly.' Items used “directly" in farming include a plow, a combine, and a milking machine. Items of “indirect" use include repair tools, computers used for tracking prices or inventories or for word processing, and lawn and garden tractors used for mowing lawns and tilling home gardens.
Tax 11.12(4)(a)2.
2. `Exclusively.' “Used exclusively" means used to the exclusion of all other uses except for other uses not exceeding 5% of total use.
Tax 11.12(4)(a)2g.
2g. `Consumed.' Property is “consumed" in farming when it is used 100% in farming. Items consumed in farming include repair tools used to repair farm machinery or farm equipment, insect control strips, computers used indirectly but solely in the business of farming, test kits to test milk for contaminants, and lubricants used in farm tractors and machines.
Tax 11.12(4)(a)2r.
2r. `Lose their identities.' Property “loses its identity in farming" when it is used 100% in farming. Property losing its identity in farming includes disinfectants and sanitizers such as iodine and chlorine, water softener salt, and detergents.
Tax 11.12(4)(a)3.
3. `Accessories, attachments, and parts.' Included within the exemption are accessories, attachments, and parts for tractors and machines used exclusively and directly, or which are consumed or lose their identities in the business of farming. “Accessories" and “attachments" include devices designed to be mounted on a machine, such as a slow moving vehicle sign attached to a tractor or pipes attached to an irrigation pump, or devices to be pushed or pulled by a machine such as a farm wagon or a plow. A machine “part" means a durable unit of definite, fixed dimensions and includes tractor tires, oil filters, and fuel pumps. Canvas covers and paint for exempt machines are exempt. “Parts" does not include fluids such as antifreeze, hydraulic fluids, or diesel fuel anti-gel additives. These are “other tangible personal property" rather than “parts."
Tax 11.12(4)(a)4.a.a. “Machine" means an assemblage of parts that transmit force, motion and energy from one part to another in a predetermined manner.
Tax 11.12(4)(a)4.b.
b. “Machines which qualify for exemption" include, if not realty improvements, all-terrain vehicles or trucks not licensed for highway use, balers, chain saws for orchard or logging use but not for use in cutting firewood for personal use or for use in pulpwood or sawmill operations, choppers, corn pickers, crop conditioners, crop thinners, cultivators, discs, drags, end loaders, electric clippers and hoof trimmers, electric dehorners, electric fence chargers not fencing or insulators, electric foggers, fork lifts, harrows, harvesting combines, hay wagons, manure spreaders, mowers, planters, plows, powered posthole diggers, pumps and associated piping for irrigation, rock pickers, rotary hoes, space heaters not for residential use, sprayers, stalk shredders, and windrowers.
