AB133-SSA1,874,1824 71.25 (6) Allocation and separate accounting and apportionment formula.
25(intro.) Corporations engaged in business within and without the state shall be taxed

1only on such income as is derived from business transacted and property located
2within the state. The amount of such income attributable to Wisconsin may be
3determined by an allocation and separate accounting thereof, when the business of
4such corporation within the state is not an integral part of a unitary business, but
5the department of revenue may permit an allocation and separate accounting in any
6case in which it is satisfied that the use of such method will properly reflect the
7income taxable by this state. In all cases in which allocation and separate accounting
8is not permissible, the determination shall be made in the following manner: for all
9businesses except financial organizations, public utilities, railroads, sleeping car
10companies, car line companies and corporations or associations that are subject to
11a tax on unrelated business income under s. 71.26 (1) (a) there shall first be deducted
12from the total net income of the taxpayer the part thereof (less related expenses, if
13any) that follows the situs of the property or the residence of the recipient. The.
14Except as provided in subs. (9d) and (9g), the
remaining net income shall be
15apportioned to Wisconsin this state by use of an apportionment fraction composed
16of a sales factor under sub. (9) representing 50% of the fraction, a property factor
17under sub. (7) representing 25% of the fraction and a payroll factor under sub. (8)
18representing 25% of the fraction.
the following:
AB133-SSA1, s. 1729b 19Section 1729b. 71.25 (6) (a) of the statutes is created to read:
AB133-SSA1,874,2320 71.25 (6) (a) For taxable years beginning after December 31, 2000, and before
21January 1, 2002, an apportionment fraction composed of a sales factor under sub. (9)
22representing 63% of the fraction, a property factor under sub. (7) representing 18.5%
23of the fraction and a payroll factor under sub. (8) representing 18.5% of the fraction.
AB133-SSA1, s. 1729c 24Section 1729c. 71.25 (6) (b) of the statutes is created to read:
AB133-SSA1,875,4
171.25 (6) (b) For taxable years beginning after December 31, 2001, and before
2January 1, 2003, an apportionment fraction composed of a sales factor under sub. (9)
3representing 85% of the fraction, a property factor under sub. (7) representing 7.5%
4of the fraction and a payroll factor under sub. (8) representing 7.5% of the fraction.
AB133-SSA1, s. 1729d 5Section 1729d. 71.25 (6) (c) of the statutes is created to read:
AB133-SSA1,875,76 71.25 (6) (c) For taxable years beginning after December 31, 2002, an
7apportionment fraction composed of the sales factor under sub. (9).
AB133-SSA1, s. 1730 8Section 1730. 71.25 (7) (intro.) of the statutes is amended to read:
AB133-SSA1,875,109 71.25 (7) Property factor. (intro.) For purposes of sub. (5) and for taxable
10years beginning before January 1, 2003
:
AB133-SSA1, s. 1731 11Section 1731. 71.25 (8) (intro.) of the statutes is amended to read:
AB133-SSA1,875,1312 71.25 (8) Payroll factor. (intro.) For purposes of sub. (5) and for taxable years
13beginning before January 1, 2003
:
AB133-SSA1, s. 1732 14Section 1732. 71.25 (9) (d) of the statutes is amended to read:
AB133-SSA1,875,2315 71.25 (9) (d) Sales, other than sales of tangible personal property, are in this
16state if the income-producing activity is performed in this state. If the
17income-producing activity is performed both in and outside this state the sales shall
18be divided between those states having jurisdiction to tax such business in
19proportion to the direct costs of performance incurred in each such state in rendering
20this service. Services performed in states which do not have jurisdiction to tax the
21business shall be deemed to have been performed in the state to which compensation
22is allocated by sub. (8). This paragraph does not apply to taxable years beginning
23after December 31, 1999.
AB133-SSA1, s. 1733 24Section 1733. 71.25 (9) (dc) of the statutes is created to read:
AB133-SSA1,876,4
171.25 (9) (dc) For taxable years beginning after December 31, 1999, sales,
2rents, royalties, and other income from real property, and the receipts from the lease
3or rental of tangible personal property are attributed to the state in which the
4property is located.
AB133-SSA1, s. 1734 5Section 1734. 71.25 (9) (dg) of the statutes is created to read:
AB133-SSA1,876,106 71.25 (9) (dg) For taxable years beginning after December 31, 1999, receipts
7from the lease or rental of moving property including but not limited to motor
8vehicles, rolling stock, aircraft, vessels, or mobile equipment are included in the
9numerator of the sales factor under par. (a) to the extent that the property is used
10in this state. The use of moving property in this state is determined as follows:
AB133-SSA1,876,1611 1. The use of a motor vehicle or rolling stock in this state is determined by
12multiplying the gross receipts from the lease or rental of the motor vehicle or rolling
13stock by a fraction having as a numerator the number of miles traveled within this
14state by the motor vehicle or rolling stock while leased or rented in the taxable year
15and having as a denominator the total number of miles traveled by the motor vehicle
16or rolling stock while leased or rented in the taxable year.
AB133-SSA1,876,2117 2. The use of an aircraft in this state is determined by multiplying the gross
18receipts from the lease or rental of the aircraft by a fraction having as a numerator
19the number of landings of the aircraft in this state while leased or rented in the
20taxable year and having as a denominator the total number of landings of the aircraft
21while leased or rented in the taxable year.
AB133-SSA1,877,222 3. The use of a vessel or mobile equipment in this state is determined by
23multiplying the gross receipts from the lease or rental of the vessel or mobile
24equipment by a fraction having as a numerator the number of days that the vessel
25or mobile equipment is in this state while leased or rented in the taxable year and

1having as a denominator the total number of days that the vessel or mobile
2equipment is leased or rented in the taxable year.
AB133-SSA1,877,63 4. If the taxpayer does not know the location of moving property while such
4property is leased or rented in the taxable year, the moving property is used in the
5state in which such property is located at the time the lessee or renter takes
6possession of the property.
AB133-SSA1, s. 1735 7Section 1735. 71.25 (9) (dn) of the statutes is created to read:
AB133-SSA1,877,108 71.25 (9) (dn) For taxable years beginning after December 31, 1999, gross
9royalties and gross income received for the use of intangible property are attributed
10to this state if any of the following applies:
AB133-SSA1,877,1311 1. The purchaser of intangible property uses the intangible property in the
12production, fabrication or manufacturing of a product that is sold to a customer who
13is located in this state.
AB133-SSA1,877,1614 2. The purchaser of intangible property uses the intangible property in the
15printing or publication of materials that are sold to a customer who is located in this
16state.
AB133-SSA1,877,1817 3. The purchaser of intangible property uses the intangible property in the
18operation of a trade or business at a location in this state.
AB133-SSA1,877,2019 4. The purchaser of intangible property is billed for the purchase of the
20intangible property at a location in this state.
AB133-SSA1,877,2221 5. The taxpayer is not subject to income tax in the state in which the intangible
22property is used but the taxpayer's commercial domicile is in this state.
AB133-SSA1, s. 1736 23Section 1736. 71.25 (9) (dr) of the statutes is created to read:
AB133-SSA1,878,224 71.25 (9) (dr) 1. For taxable years beginning after December 31, 1999, receipts
25from a service are attributed to the state where the purchaser of the service received

1the benefit of the service. The benefit of a service is received in this state if any of
2the following applies:
AB133-SSA1,878,33 a. The service relates to real property that is located in this state.
AB133-SSA1,878,54 b. The service relates to tangible personal property that is located in this state
5at the time that the service is received.
AB133-SSA1,878,66 c. The service is provided to a person who is located in this state.
AB133-SSA1,878,77 d. The service is provided to a person doing business in this state.
AB133-SSA1,878,88 e. The service is performed at a location in this state.
AB133-SSA1,878,179 2. If the purchaser of a service receives the benefit of a service in more than one
10state, the receipts from the performance of the service are included in the numerator
11of the sales factor under par. (a) according to the portion of the service received in this
12state. If the state where a purchaser received the benefit of a service cannot be
13determined, the benefit of a service is received in the state where the purchaser, in
14the regular course of the purchaser's business, ordered the service. If the state where
15a purchaser ordered a service cannot be determined, the benefit of the service is
16received in the state where the purchaser, in the regular course of the purchaser's
17business, receives a bill for the service.
AB133-SSA1,878,2118 3. If the taxpayer is not subject to income tax in the state in which the benefit
19of the service is received, the benefit of the service is received in this state to the
20extent that the taxpayer's employes or representatives performed services from a
21location in this state.
AB133-SSA1, s. 1736b 22Section 1736b. 71.25 (9) (ds) of the statutes is created to read:
AB133-SSA1,879,223 71.25 (9) (ds) 1. For taxable years beginning after December 31, 1999, the gate
24receipts from professional sporting events are attributed to the state in which the

1taxpayer's sports facility is located. Gate receipts include the taxpayer's in-state
2gate receipts and the taxpayer's share of out-of-state gate receipts.
AB133-SSA1,879,83 2. For taxable years beginning after December 31, 1999, radio and television
4receipts received by the taxpayer from a professional sports association contract with
5a communications network are attributed to this state in proportion to the number
6of events held in this state in which the taxpayer's team is a participant and that are
7related to the contract compared to the total number of events in which the
8taxpayer's team is a participant and that are related to the contract.
AB133-SSA1, s. 1736c 9Section 1736c. 71.25 (9) (dt) of the statutes is created to read:
AB133-SSA1,879,1310 71.25 (9) (dt) 1. For taxable years beginning after December 31, 1999, the gross
11receipts from radio and television broadcasting, including advertising revenue, are
12attributed to this state in proportion to the audience in this state as compared to the
13total audience.
AB133-SSA1,879,1614 2. For taxable years beginning after December 31, 1999, the gross receipts from
15newspapers and magazines, including advertising revenue, are attributed to this
16state in proportion to the circulation in this state as compared to the total circulation.
AB133-SSA1, s. 1736d 17Section 1736d. 71.25 (9) (dw) of the statutes is created to read:
AB133-SSA1,879,2218 71.25 (9) (dw) 1. Except as provided in subds. 2. and 3., if a person doing
19business in this state and outside this state owns a business that is subject to
20apportionment under sub. (6) or s. 71.04 (4) and a business that is a subject to
21apportionment under sub. (10), the person shall apportion income as provided under
22sub. (6) or s. 71.04 (4).
AB133-SSA1,880,623 2. A person who has filed a tax return and who has reported income on the
24return as apportioned under subd. 1 may request permission from the department
25to use an alternative apportionment method in the next taxable year, if the person

1receives at least 50% of the person's total gross receipts in a taxable year from a
2business described under sub. (10) (c). If the department grants permission to a
3person to use an alternative apportionment method under this subdivision, the
4person may not use the alternative method, and shall apportion income under subd.
51., if the person receives less than 50% of the person's total gross receipts in a taxable
6year from a business described under sub. (10) (c).
AB133-SSA1,880,97 3. The department may require that a person who is subject to apportionment
8under this subsection use an alternative apportionment method to accurately reflect
9income that is attributable to this state.
AB133-SSA1, s. 1737 10Section 1737. 71.25 (9) (e) (title) of the statutes is repealed.
AB133-SSA1, s. 1738 11Section 1738. 71.25 (9) (f) (title) of the statutes is repealed.
AB133-SSA1, s. 1738g 12Section 1738g. 71.25 (9d) of the statutes is created to read:
AB133-SSA1,880,1313 71.25 (9d) Financial organizations. (a) Definitions. In this subsection:
AB133-SSA1,880,1514 1. "Billing address" means the address to which a taxpayer under this
15subsection sends a notice, statement or bill to the taxpayer's customer.
AB133-SSA1,880,1616 2. "Credit card" includes a debit card and a travel and entertainment card.
AB133-SSA1,880,1917 3. "Credit card reimbursement fee" means the fee that a taxpayer receives from
18a merchant's bank because a person to whom the taxpayer has issued a credit card
19has paid for merchandise or services sold by the merchant with the credit card.
AB133-SSA1,881,620 4. "Financial organization" means a bank; a savings bank; a bank holding
21company; a savings and loan association; a trust company; a credit union, except a
22credit union that is exempt from taxes under s. 71.26 (1) (a); a production credit
23association; or an agency or branch of a foreign depository; whether chartered under
24the laws of this state, another state or territory, the laws of the United States or the
25laws of a foreign county. "Financial organization" includes a corporation that derives

1at least 50% of its total gross income from finance leases, including direct finance
2leases and leverage leases as defined by rule, and a corporation that derives at least
350% of its total gross income from an activity that a financial organization performs,
4except that "financial organization" does not include an insurance company that is
5taxable under s. 71.43 or a real estate broker, securities dealer or broker-dealer that
6is taxable under s. 71.26.
AB133-SSA1,881,167 5. "Loan" means any extension of credit or creation of debt that results from
8direct negotiations between the taxpayer under this subsection and the taxpayer's
9customer; the purchase, in whole or in part, of an extension of credit; and
10participations, syndications and leases that are considered loans for federal income
11tax purposes. "Loan" does not include loans under section 595 of the Internal
12Revenue Code; futures or forward contracts; options; notional principal contracts;
13credit card receivables; purchased credit card relationships; noninterest bearing
14balances that are due from depository institutions; cash items in the process of
15collection; federal funds sold; securities; assets held in a trading account; and
16interest in any mortgage-backed or assets-backed security.
AB133-SSA1,881,1917 6. "Merchant discount" means a fee or discount that is charged to a merchant
18for accepting a credit card as payment for merchandise or services that are sold to
19the credit card holder.
AB133-SSA1,881,2120 7. "State" means a state of the United States, the District of Columbia, the
21commonwealth of Puerto Rico or a territory or possession of the United States.
AB133-SSA1,881,2322 8. "Taxpayer" means a financial organization that is subject to apportionment
23under this subsection.
AB133-SSA1,882,924 (b) Apportionment. For taxable years beginning after December 31, 1999, a
25financial organization that does business in this state and outside this state shall

1apportion its net business income as provided in this subsection. A taxpayer that is
2subject to this subsection shall apportion its nonbusiness income under sub. (5) (b)
3and shall deduct the net business income that follows the situs of its property from
4its total net business income. The taxpayer's remaining net business income shall
5be apportioned to this state by multiplying the remaining net business income by an
6apportionment fraction that has as a numerator the gross receipts of the taxpayer
7in this state during the taxable year and that has a denominator the taxpayer's total
8gross receipts during the taxable year. The following sources of a taxpayer's business
9income are subject to apportionment:
AB133-SSA1,882,1210 1. `Gross receipts from the lease of real property.' Gross receipts from the lease,
11rental or sublease of real property owned by the taxpayer shall be apportioned under
12sub. (9) (dc).
AB133-SSA1,882,1513 2. `Gross receipts from the lease of tangible personal property.' Gross receipts
14from the lease, rental or sublease of tangible personal property owned by the
15taxpayer shall be apportioned under sub. (9) (dc) and (dg).
AB133-SSA1,882,2516 3. `Gross interest from loans secured by real property.' The numerator of the
17apportionment fraction includes gross interest, fees or penalties from loans that are
18secured by real property if the real property is located in this state at the time the
19loan is secured and if the value of the real property represents at least 50% of the
20aggregate value of the collateral that is used to secure the loan. If the real property
21that is used to secure a loan is located in this state and in another state or a foreign
22country, the gross interest, fees or penalties from the loan are included in the
23numerator of the apportionment fraction, if at least 50% of the fair market value of
24the real property is located within this state or if the loan borrower is located in this
25state.
AB133-SSA1,883,3
14. `Gross interest from loans.' The numerator of the apportionment fraction
2includes gross interest, fees or penalties from loans that are not secured by real
3property, if the loan borrower is located in this state.
AB133-SSA1,883,64 5. `Sale of loans.' The numerator of the apportionment fraction includes income
5from the sale of loans and income under section 1286 of the Internal Revenue Code.
6The income that is included in the numerator is determined as follows:
AB133-SSA1,883,107 a. The gross receipts from the sale of loans secured by real property is
8multiplied by a fraction that has as a numerator the amount included in the
9numerator under subd. 3. and that has as a denominator the total amount of interest,
10fees and penalties from loans that are secured by real property.
AB133-SSA1,883,1411 b. The net gains from the sale of loans that are not secured by real property is
12multiplied by a fraction that has as a numerator the amount included in the
13numerator under subd. 4. and that has as a denominator the total amount of interest,
14fees and penalties from loans that are not secured by real property.
AB133-SSA1,883,1815 6. `Credit card receivables.' The numerator of the apportionment fraction
16includes gross interest, fees or penalties from credit card receivables and gross
17receipts from fees charged to credit card holders, if the billing address of the credit
18card holder is in this state.
AB133-SSA1,883,2319 7. `Gross receipts from the sale of credit card receivables.' The numerator of
20the apportionment fraction includes gross receipts from the sale of credit card
21receivables, multiplied by a fraction that has as a numerator the amount included
22in the numerator under subd. 6. and that has as a denominator the total amount of
23interest, fees and penalties that are charged to credit card holders.
AB133-SSA1,884,324 8. `Credit card reimbursement fees.' The numerator of the apportionment
25fraction includes credit card reimbursement fees, multiplied by a fraction that has

1as a numerator the amount included in the numerator under subd. 6. and that has
2as a denominator the total amount of interest, fees and penalties that are charged
3to credit card holders.
AB133-SSA1,884,94 9. `Gross receipts from a merchant discount.' The numerator of the
5apportionment fraction includes gross receipts from a merchant discount if the
6merchant's business is principally managed from a location in this state. The gross
7receipts from a merchant discount shall not include credit card holder charge backs.
8The amount of gross receipts from a merchant discount shall not be reduced by
9interchange transaction fees or by a credit card reimbursement fee.
AB133-SSA1,884,1910 10. `Loan servicing fees.' a. The numerator of the apportionment fraction
11includes loan servicing fees derived from loans that are secured by real property,
12multiplied by a fraction that has as a numerator the amount included in the
13numerator under subd. 3. and that has as a denominator the total amount of interest,
14fees and penalties from loans that are secured by real property. The numerator of
15the apportionment fraction also includes loan servicing fees derived from loans that
16are not secured by real property, multiplied by a fraction that has as a numerator the
17amount included in the numerator under subd. 4. and that has as a denominator the
18total amount of interest, fees and penalties from loans that are not secured by real
19property.
AB133-SSA1,884,2220 b. If the taxpayer receives loan servicing fees for servicing a loan, the
21numerator of the apportionment fraction shall include such fees if the borrower of
22the loan is located in this state.
AB133-SSA1,885,223 11. `Gross income from investment banking services.' The numerator of the
24apportionment fraction includes gross income, including commissions, management

1fees or underwriting fees, earned from investment banking services if the purchaser
2of the services is located in this state.
AB133-SSA1,885,43 12. `Gross receipts from other services.' The gross receipts from services that
4are not described under subds. 1. to 11. shall be apportioned under sub. (9) (dr).
AB133-SSA1,885,65 13. `Other sales.' Sales under sub. (9) that are not apportioned under this
6subsection shall be apportioned under sub. (9).
AB133-SSA1,885,107 (c) Receipts not taxed. Fifty percent of the gross receipts of the taxpayer that
8are apportioned under this subsection to a state in which the taxpayer is not taxable
9is included in the numerator of the apportionment fraction under par. (b), if the
10taxpayer's commercial domicile is in this state.
AB133-SSA1, s. 1738k 11Section 1738k. 71.25 (9g) of the statutes is created to read:
AB133-SSA1,885,1312 71.25 (9g) Brokers-dealer and underwriters. (a) Definitions. In this
13subsection:
AB133-SSA1,885,1414 1. "Billing address" has the meaning given in sub. (9d) (a) 1.
AB133-SSA1,885,1615 2. "Brokerage commission" includes sales fees on agency or principal
16transactions.
AB133-SSA1,885,2217 3. "Broker-dealer" means a person who does business as a broker of securities
18or commodities. "Broker-dealer" does not include a sales agent; a bank, savings
19institution or trust company that enters a securities or commodities transaction as
20an agent; a executor, guardian or conservator who enters a securities or commodities
21transaction as an agent for another; or a person who purchases or sells the person's
22own securities or commodities.
AB133-SSA1,885,2423 4. "Taxpayer" means a broker-dealer or an underwriter who is subject to
24apportionment under this subsection.
AB133-SSA1,886,5
15. "Underwriter" means a person who guarantees to provide a definite sum of
2money by a definite date to a corporate or government entity in exchange for
3securities; who markets a corporate or government security offering to the public; or
4who buys a security offering for a specified price and sells the security offering to the
5public.
AB133-SSA1,886,166 (b) Apportionment. For taxable years beginning after December 31, 1999, a
7broker-dealer or an underwriter who does business in this state and outside this
8state shall apportion its net business income as provided under this subsection. A
9taxpayer that is subject to this subsection shall apportion its nonbusiness income
10under sub. (5) (b) and shall deduct the net business income that follows the situs of
11its property from its total net business income. The taxpayer's remaining net
12business income shall be apportioned to this state by multiplying the remaining net
13business income by an apportionment fraction that has as a numerator the gross
14receipts of the taxpayer in this state during the taxable year and that has a
15denominator the taxpayer's total gross receipts during the taxable year. The
16following sources of a taxpayer's business income are subject to apportionment:
AB133-SSA1,886,2017 1. `Security brokerage services.' The numerator of the apportionment fraction
18includes gross brokerage commissions and total margin interest paid on behalf of
19brokerage accounts owned by customers, if the billing address of the customer is in
20this state.
AB133-SSA1,886,2421 2. `Underwriting services.' The numerator of the apportionment fraction
22includes gross income, including commissions, management fees or underwriting
23fees, earned from underwriting services if the purchaser of the services is located in
24this state.
AB133-SSA1,887,4
13. `Other services.' The numerator of the apportionment fraction includes gross
2income, including commissions or management fees, earned from providing
3investment research, management services or financial services to a customer, if the
4customer's billing address is in this state.
AB133-SSA1,887,65 4. `Other sales.' Sales under sub. (9) that are not apportioned under this
6subsection shall be apportioned under sub. (9).
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