Tax 11.20(4)(d)(d) The certification period under par. (c) shall correspond to the business’ tax year as determined for federal income tax purposes, including short years, subject to the following conditions: Tax 11.20(4)(d)1.1. If a business is certified by the department with respect to a previous tax year, the certification is valid only for the previous tax year. Tax 11.20(4)(d)2.2. If a business is certified for a current tax year, the certification is valid until the expected end of the tax year unless, during such tax year the business’ tax year terminates earlier than expected. When a tax year terminates earlier than expected, the certification is valid until the actual end of the tax year as determined for federal income tax purposes. Tax 11.20(4)(e)(e) Notwithstanding any other provision in this subsection, the department may: Tax 11.20(4)(e)1.1. Revoke any certification granted under this subsection, but only upon information that either the business’ application for certification contained a misstatement as to the business’ gross income or expenses and deductions or the business no longer qualifies as a biotechnology business. Tax 11.20(4)(e)2.2. Require any business seeking certification to be certified only with respect to its previous tax years. Tax 11.20 NoteNote: The interpretations in s. Tax 11.20 are effective beginning January 1, 2012, pursuant to 2009 Wis. Act 28, except for the following amendments effective July 2, 2013, pursuant to 2013 Wis. Act 20: (a) “Qualified research” was amended to include research funded by one member of a combined group for another member of a combined group; (b) The exemption for property used in qualified research by persons engaged primarily in manufacturing in Wisconsin was amended to apply to property used in qualified research by a person engaged in manufacturing in Wisconsin at a building assessed under s. 70.995, Stats.; (c) The exemption for property used in qualified research was amended to include use by one member of a combined group who is conducting qualified research for another combined group member who is either engaged in manufacturing in Wisconsin at a building assessed under s. 70.995, Stats., or is primarily engaged in biotechnology; and (d) The change of the term “medicines” to “drugs.” Tax 11.20 HistoryHistory: CR 12-015: cr. Register July 2012 No. 679, eff. 8-1-12; CR 14-006: cr. (1) (cg), (cr), am. (1) (h), r. and recr. (2) (a), am. (2) (b), (Example 2), (Example 3), (c), (d) (Example 1) to (Example 5), (e) 2. L. (Example), (3) (a) 2., (b) Register August 2014 No. 704, eff. 9-1-14; correction in (2) (d) (Examples) (1) made under s. 13.92 (4) (b) 7., Stats., Register August 2014 No. 704; CR 19-113: renum. (3) (c) to (3) (c) 1. and am., cr. (3) (c) 2., am. (4) (a), cr. (4) (am), (Example) Register April 2020 No. 772, eff. 5-1-20; CR 20-027: am. (3) (a) 2. Register July 2021 No. 787, eff. 8-1-21. Tax 11.26Tax 11.26 Other taxes, fees, and charges in taxable sales price and purchase price. Tax 11.26(1)(a)(a) Tangible personal property and items, property, and goods under s. 77.52 (1) (b), (c), and (d), Stats., sold at retail are subjected to many direct and indirect taxes, fees, and charges prior to reaching a retailer. The taxes, fees, and charges are commonly included in the price the retailer pays for the property and are not separately identifiable as taxes, fees, and charges. Occasionally, however, a tax, fee, or charge is either separately passed on to a retailer or is imposed at the retail level of activity, but is different from and in addition to the sales tax. The tax, fee, or charge may be imposed by Wisconsin, the federal government, or a municipality. Tax 11.26(1)(b)(b) In determining the sales price or purchase price used to compute Wisconsin sales or use taxes, the treatment of a tax, fee, or charge for sales tax purposes is identical to the treatment that applies for use tax purposes. The same taxes, fees, and charges that are included or excluded from the sales price are also included or excluded from the purchase price. Tax 11.26(2)(2) Taxes, fees, and charges included as part of sales price and purchase price. The following taxes, fees, and charges are included in the sales price and the purchase price, regardless of whether they are separately stated on the invoice, bill of sale, or other similar document given by the seller to the purchaser, except as provided in sub. (3): Tax 11.26(2)(c)(c) Any federal stamp tax and manufacturer’s or importer’s excise tax not imposed directly on the purchaser. Federal excise taxes include excise taxes on alcohol, tobacco, motor and aviation fuel except motor fuel taxes refunded, tires, firearms and ammunition, sporting goods, and air or ship transportation. Tax 11.26(2)(d)(d) A federal, county, or municipal fuel tax included in the price of alternate fuels and general aviation fuel subject to sales tax. Tax 11.26 NoteExample: Fuel taxes are included in the price of fuel used in aircraft, boats, and for other nonhighway use. The taxes are included in the sales price.
Tax 11.26(2)(f)(f) The Canadian or any other country’s export gallonage tax on fuels. Tax 11.26(2)(h)(h) The federal gas guzzler tax imposed under s. 4064 of the Internal Revenue Code. Tax 11.26(2)(j)(j) The federal medical device excise tax imposed under s. 4191 of the Internal Revenue Code. Tax 11.26(3)(3) Taxes, fees, and charges excluded from sales price or purchase price. Section 77.51 (12m) (b) 3. and (15b) (b) 3., Stats., exclude from the sales price and purchase price any taxes legally imposed directly on the purchaser that are separately stated on the invoice, bill of sale, or similar document that the seller gives to the purchaser. Section 77.51 (12m) (b) 3m. and (15b) (b) 3m., Stats., exclude from the sales price and purchase price taxes imposed on the seller that are separately stated on the invoice, bill of sale, or similar document that the seller gives to the purchaser if the law imposing or authorizing the tax provides that the seller may, but is not required to, pass on to and collect the tax from the user or consumer. Therefore, the following taxes, fees, and charges are excluded from the sales price or the purchase price if they are separately stated on the invoice, bill of sale, or similar document given to the purchaser: Tax 11.26(3)(a)(a) The federal communications tax imposed upon telegraph service and telephone service. Tax 11.26(3)(ac)(ac) The room taxes imposed under s. 66.0615, Stats., which municipalities or local exposition districts impose on persons furnishing lodging to transients. Tax 11.26(3)(aL)(aL) The local exposition district food and beverage and rental car taxes imposed under ss. 77.98 and 77.99, Stats. Tax 11.26(3)(ax)(ax) The federal luxury tax imposed under ss. 4001 to 4007 of the Internal Revenue Code. Tax 11.26(3)(c)(c) Federal and Wisconsin motor vehicle excise taxes refunded. Tax 11.26(3)(j)(j) The federal excise tax imposed on the first retail sale of heavy trucks and trailers under section 4051 of the Internal Revenue Code. Tax 11.26 NoteNote: The interpretations in s. Tax 11.26 are effective under the general sales and use tax law on and after September 1, 1969, except: (a) The exclusion for federal and Wisconsin motor vehicle excise taxes refunded became effective December 1, 1997, pursuant to 1997 Wis. Act 27; (b) The change of the term “gross receipts” to “sales price” and 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; (c) The regional transit authority taxes were authorized by 2009 Wis. Act 28 and repealed by 2011 Wis. Act 32; (d) The definitions of “purchase price” and “sales price” were amended to provide when taxes are not included in the “purchase price” or “sales price,” pursuant to 2013 Wis. Act 20; and (e) The definitions of “purchase price” and “sales price” were amended retroactively to September 1, 2014, to exclude the federal excise tax on heavy trucks and trailers, pursuant to 2015 Wis. Act 361. Tax 11.26 HistoryHistory: Cr. Register, September, 1977, No. 261, eff. 10-1-77; am. (2) (d) and (e) and cr. (2) (f), Register, January, 1983, No. 325, eff. 2-1-83; cr. (2) (g), Register, December, 1983, No. 336, eff. 1-1-84; am. (3) (b), Register, April, 1990, No. 412, eff. 5-1-90; am. (1) (a) and (b), (2) (intro.), (b), (c), (d) and (e) and (3) (a), Register, June, 1991, No. 426, eff. 7-1-91; am. (2) (intro.), (c), (3) (intro.) and (b), Register, December, 1992, No. 444, eff. 1-1-93; am. (2) (c) and (d), cr. (2) (h) and (3) (c), Register, August, 1999, No. 524, eff. 9-1-99; EmR0924: emerg. am. (title), (1) (a), (2) (title), (intro.), (c), (3) (title) and (b), r. and recr. (1) (b) and (3) (intro.), eff. 10-1-09; CR 09-090: am. (title), (1) (a), (2) (title), (intro.), (c), (3) (title) and (b), r. and recr. (1) (b) and (3) (intro.) Register May 2010 No. 653, eff. 6-1-10; CR 10-094: am. (1) (a), (2) (c), (d), (3) (b) Register November 2010 No. 659, eff. 12-1-10; CR 12-014: am. (3) (Example 1), (Example 3) Register August 2012 No. 680, eff. 9-1-12; CR 14-006: am. (title), (1) (a), (b), (2) (title), (intro.), (c), (h), cr. (2) (i) to (s), am. (3) (title), (intro.), cr. (3) (ac) to (ax), r. (3) (b) and (Example 1) to (Example 7), cr. (3) (d) to (h) Register August 2014 No. 704, eff. 9-1-14; CR 19-112: r. (2) (i), am. (2) (q), cr. (3) (i), (j) Register June 2020 No. 774, eff. 7-1-20.; CR 20-018: r. (3) (g) Register July 2021, No. 787, eff. 8-1-21. Tax 11.27Tax 11.27 Maintenance contracts, insurance, and warranties. Tax 11.27(1)(a)(a) “Computer software maintenance contract” means a contract that obligates a vendor of computer software to provide a customer with future updates or upgrades to computer software, computer software support services, or both. Tax 11.27(1)(b)(b) “Insurance” means a contract or agreement which promises indemnity against loss or damage resulting from perils outside of and unrelated to defects in tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats. Tax 11.27(1)(c)(c) “Warranty” means a contract or agreement which promises indemnity against defects in tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., sold. Tax 11.27(2)(2) Receipts from insurance. The sales price from the sale of insurance, except contracts under s. 77.52 (2) (a) 13m., Stats., are not subject to Wisconsin sales or use tax when separately stated on the invoice provided to the purchaser. Tax 11.27 NoteExamples: 1) Company A rents a vehicle to Customer A for $200 which includes insurance. The entire charge of $200 is subject to Wisconsin sales or use tax because the charge for insurance is not separately stated.
Tax 11.27 Note2) Company A rents a vehicle to Customer B for $200. On the invoice, Company A shows a charge for vehicle rental of $175 and a charge for insurance of $25. The charge of $175 is subject to Wisconsin sales or use tax. The $25 charge for the insurance is not subject to tax since it is separately stated on the invoice provided to the purchaser.
Tax 11.27(3)(3) Receipts from maintenance contracts and warranties. Section 77.52 (2) (a) 13m., Stats., imposes Wisconsin sales tax on the sale of contracts, including service contracts, maintenance agreements, computer software maintenance contracts for prewritten computer software, and warranties, that provide, in whole or in part, for the future performance of or payment for the repair, service, alteration, fitting, cleaning, painting, coating, towing, inspection, or maintenance of tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., unless the sale, license, lease, or rental in this state of the property, items, or goods to which the contract relates is or was exempt, to the purchaser of the contract, from taxation under subch. III of ch. 77, Stats. Tax 11.27 NoteExamples: 1) Company A sells a machine to Customer C which will be used exclusively and directly in manufacturing. Customer C purchases an extended warranty with the machine. Customer C provides Company A with a properly completed exemption certificate. The sale of the extended warranty is not subject to Wisconsin sales or use tax because the machine to which it relates is exempt from Wisconsin sales or use tax.
Tax 11.27 Note2) Customer D, a resident of Minnesota, purchases an automobile from a dealership in Wisconsin. Customer D makes no use of the automobile in Wisconsin other than to drive it to his home in Minnesota. Customer D purchases an extended warranty with the automobile. The sale of the extended warranty is not subject to Wisconsin sales or use tax because the sale of the automobile is exempt from Wisconsin sales or use tax.
Tax 11.27 Note3) Assume the same facts as in Example 2, except that Customer D does not purchase the extended warranty at the time of sale of the automobile. Instead, six weeks after the sale, Customer D purchases the extended warranty from the dealer. The sale of the extended warranty is not subject to Wisconsin sales or use tax because the automobile to which the sale relates was exempt from Wisconsin sales or use tax.
Tax 11.27 Note4) Customer E, a resident of Wisconsin, purchases an appliance from a store in Wisconsin. Customer E purchases an extended warranty with the appliance. The sale of the extended warranty is subject to Wisconsin sales tax because the sale of the appliance is subject to Wisconsin sales tax.
Tax 11.27 Note5) Assume the same facts as in Example 4, except that Customer E does not purchase the extended warranty at the time of sale of the appliance. Instead, 2 months after the sale, Customer E purchases the extended warranty from the store. The sale of the extended warranty is subject to Wisconsin sales tax because the appliance to which the sale relates was subject to Wisconsin sales tax.
Tax 11.27(4)(a)(a) The sales price from charges by a retailer to a customer or an insurer for taxable repair parts or taxable services performed under an insurance plan are subject to Wisconsin sales or use tax. Tax 11.27 NoteExamples: 1) Company A sold an appliance to Customer E. Company A also sold an insurance plan for the appliance to Customer E. The appliance is later repaired by Company A under the insurance plan. Company A bills the insurance company for the repair. The charge to the insurance company is subject to Wisconsin sales or use tax.
Tax 11.27 Note2) Company A sold an appliance to Customer F. Company A also sold an insurance plan for the appliance to Customer F. The appliance is later repaired by Company A under the insurance plan. Company A bills the customer for the repair. Customer F submits the bill to the insurance company and receives reimbursement from the insurance company. The charge to Customer F for the repair is subject to Wisconsin sales tax.
Tax 11.27(4)(b)1.1. A retailer who provides parts or performs taxable repair services to tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., under an insurance plan may purchase the tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., transferred to the customer as part of the repair without Wisconsin sales or use tax as property for resale. Tax 11.27(4)(b)2.2. A person who provides tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., in repairing real property under an insurance plan is the consumer of the tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., transferred to a customer as part of the repair to real property and is subject to Wisconsin sales or use tax on the purchase of the tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., transferred. Tax 11.27 NoteNote: Refer to s. Tax 11.68 for information about distinguishing between real and tangible personal property. Tax 11.27(5)(5) Repairs by retailers under maintenance contracts and warranties. Tax 11.27(5)(a)(a) The sales price from charges by a retailer to a customer for taxable repair parts or taxable services performed under a maintenance contract or warranty and that are not reimbursed by the seller of the maintenance contract or warranty are subject to Wisconsin sales or use tax. Tax 11.27 NoteExample: Customer A purchased an automobile from a dealership in Wisconsin. Customer A purchased an extended warranty from the dealership which was subject to Wisconsin sales or use tax. Customer A brings the automobile to the dealership for repair under the warranty. Under the terms of the warranty, Customer A must pay a deductible of $100. The $100 charge to Customer A is subject to Wisconsin sales or use tax.
Tax 11.27(5)(b)(b) Reimbursement to a retailer from a manufacturer or other person, whether in the form of money or replacement of parts used to perform repair services under a warranty is not subject to Wisconsin sales or use tax. Tax 11.27 NoteExample: Customer B purchased a television with an extended warranty from an appliance store. Customer B has the television repaired under the warranty. The appliance store is reimbursed $200 by the warranty company for the repair of the television. The $200 reimbursement is not subject to Wisconsin sales or use tax.
Tax 11.27(5)(c)1.1. A retailer who provides parts or performs taxable repair services to tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., under a maintenance contract or warranty may purchase the tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., transferred to the customer as part of the repair without Wisconsin sales or use tax as property, items, or goods for resale. Tax 11.27(5)(c)2.2. A person who provides tangible personal property or items or property, under s. 77.52 (1) (b) or (c), Stats., in repairing real property under a maintenance contract or warranty is the consumer of the tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., transferred to a customer as part of the repair to real property and is subject to Wisconsin sales or use tax on the purchase of the tangible personal property or items or property, under s. 77.52 (1) (b) or (c), Stats., transferred. Tax 11.27 NoteNote: Refer to s. Tax 11.68 for information about distinguishing between real and tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats. Tax 11.27(6)(6) Repairs not by retailers. If a retailer does not repair tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., under a maintenance contract, warranty, or insurance plan, but instead has another person perform the repairs covered under the maintenance contract, warranty, or insurance plan, the person’s sales price from the sale of the repair to the retailer is not subject to Wisconsin sales or use tax provided the retailer gives the person a properly completed exemption certificate. The charge for repairs by the other person is exempt as a sale for resale whether or not the original sale of the property, item, or good to which the maintenance contract, warranty, or insurance plan relates occurred in Wisconsin. The sales and use tax treatment of the charge by the retailer to the customer or plan provider is the same as provided in subs. (4) and (5). Tax 11.27 NoteNote: Refer to s. Tax 11.14 for information regarding exemption certificates. Tax 11.27(7)(7) Goodwill work. A retailer who provides free parts or services or both to a customer under an implied warranty in order to maintain good customer relations, although not required to do so under a sales agreement, maintenance agreement, express warranty, or insurance plan may purchase the parts without Wisconsin sales or use tax for resale. Tax 11.27 NoteExample: Customer Z, a resident of Wisconsin, purchased an automobile and extended warranty from a Wisconsin dealership. The dealership charged Wisconsin sales tax on the sale of the automobile and warranty. Customer Z brought the vehicle to the dealership for repairs that were covered under the warranty. While performing the repairs, a part is damaged. The dealership, who is not required by the terms of the warranty to provide the part, provides the part free of charge to Customer Z. The dealership may purchase the part provided free to Customer Z without Wisconsin sales or use tax as property for resale.
Tax 11.27 NoteNote: The interpretations in s. Tax 11.27 are effective under the general sales and use tax law on and after September 1, 1969, except that (a) the definitions in sub. (1) and the provisions in subs. (4) (b) 2. and (5) (c) 2. became effective on February 1, 1994; (b) The definition of computer software maintenance contract became effective October 1, 2009 pursuant to 2009 Wis. Act 2; (c) The specific imposition of tax on maintenance contracts and extended warranties became effective October 1, 2009 pursuant to 2009 Wis. Act 2; and (d) The change of the term “gross receipts” to “sales price” and 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.
