Amendment SA2-SSA1-SB55

SB55-SSA1-SA2,263,1 909. Page 706, line 6: after that line insert:

SB55-SSA1-SA2,263,2 " Section 2114p. 70.32 (2s) of the statutes is created to read:

SB55-SSA1-SA2,263,3 70.32 (2s) (a) In this subsection:

SB55-SSA1-SA2,263,4 1. "Department" means the department of revenue.

SB55-SSA1-SA2,263,11 2. "Farm" means a business engaged in activities included in the North American Industry Classification System, 1997 edition, published by the U.S. office of management and budget under any of the following classifications, if the business generated at least $6,000 in gross receipts from such activities in the year preceding the date that a form is filed under par. (b) or if the business is likely to generate at least $6,000 in gross receipts from such activities in the year following the date that a form is filed under par. (b):

SB55-SSA1-SA2,263,14 a. Classification 111-Crop production including grow sod, Christmas trees, and ginseng under industry number 111421, but excluding growing nursery product and stock under industry number 111421.

SB55-SSA1-SA2,263,15 b. Classification 112-Animal production.

SB55-SSA1-SA2,264,5 (b) Any person who owns or who is a lessee of land used as a farm shall file a form, as prescribed by the department, with the assessor of each taxation district in which land included in the farm is located no later than March 1 that certifies that the person is the owner or lessee of land used as a farm. The person shall certify on the form that the farm generated at least $6,000 in gross receipts from the activities described under par. (a) 2. in the preceding year, or is likely to generate at least $6,000 in gross receipts from such activities in the year following the date that a form is filed under this paragraph. On the form, the person shall specify each such activity and the gross receipts generated or likely to be generated from each activity. For purposes of this subsection, gross receipts from the activities described under par. (a) 2. shall be calculated on a per farm basis, regardless of whether the farm is located in more than one taxation district. A person who has filed a form under this paragraph shall only file such a form in a subsequent year, if in that subsequent year the person has acquired or leased additional land to be used as part of the farm.

SB55-SSA1-SA2,264,16 (c) If the use of the person's land has changed so that it may no longer be assessed as agricultural land under sub. (2r), the person who owns or who is the lessee of the land shall notify the clerk of the taxation district in which the person's land is located, on a form prescribed by the department. If the use of the person's land has changed so that it may no longer be assessed as agricultural land under sub. (2r) and the person who owns or who is the lessee of the land does not notify the clerk of the taxation district as provided under this paragraph, the taxation district shall treat the difference between the land's value as agricultural land under sub. (2r) and the land's value under the appropriate classification as provided under sub. (2) (a) as omitted property under s. 70.44 and collect from the owner of the land the penalty under s. 74.48.".

SB55-SSA1-SA2,264,18 910. Page 706, line 15: delete the material beginning with that line and ending on page 708, line 5.

SB55-SSA1-SA2,264,20 911. Page 723, line 19: delete the material beginning with that line and ending with page 728, line 17.

SB55-SSA1-SA2,264,22 912. Page 728, line 20: delete "(2dx) and, (3g), and" and substitute "(2dx), and".

SB55-SSA1-SA2,264,23 913. Page 730, line 18: after that line insert:

SB55-SSA1-SA2,264,24 " Section 2145m. 71.07 (2di) (b) 1. of the statutes is amended to read:

SB55-SSA1-SA2,265,8 71.07 (2di) (b) 1. Except as provided in subd. 2., the credit, including any credits carried over, may be offset only against the amount of the tax otherwise due under this chapter attributable to income from the business operations of the claimant in the development zone; except that a claimant in a development zone under s. 560.795 (1) (e) may offset the credit, including any credits carried over, against the amount of the tax otherwise due under this chapter attributable to all of the claimant's income; and against the tax attributable to income from directly related business operations of the claimant.

SB55-SSA1-SA2, s. 2145p Section 2145p. 71.07 (2di) (b) 3. of the statutes is amended to read:

SB55-SSA1-SA2,266,2 71.07 (2di) (b) 3. Partnerships, limited liability companies and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and 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 company shall compute the amount of the 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. Partners, members of limited liability companies and shareholders of tax-option corporations may claim the credit based on the partnership's, company's or corporation's activities in proportion to their ownership interest and may offset it against the tax attributable to their income from the partnership's, company's or corporation's business operations in the development zone; except that partners, members, and shareholders in a development zone under s. 560.795 (1) (e) may offset the credit against the amount of the tax attributable to their income from all of the partnership's, company's, or corporation's business operations; and against the tax attributable to their income from the partnership's, company's or corporation's directly related business operations.".

SB55-SSA1-SA2,266,3 914. Page 731, line 2: after "(e)" insert "and (f)".

SB55-SSA1-SA2,266,4 915. Page 733, line 2: after that line insert:

SB55-SSA1-SA2,266,12 "(hm) Credits claimed under this subsection, including any credits carried over, may be offset only against the amount of the tax otherwise due under this subchapter attributable to income from the business operations of the claimant in the development zone; except that a claimant in a development zone under s. 560.795 (1) (e) may offset credits, including any credits carried over, against the amount of the tax otherwise due under this subchapter attributable to all of the claimant's income; and against the tax attributable to income from directly related business operations of the claimant.".

SB55-SSA1-SA2,266,16 916. Page 733, line 14: after "zone" insert "; except that partners, members, and shareholders in a development zone under s. 560.795 (1) (e) may offset the credit against the amount of the tax attributable to their income from all of the partnership's, company's, or corporation's business operations;".

SB55-SSA1-SA2,266,17 917. Page 734, line 22: after that line insert:

SB55-SSA1-SA2,266,18 " Section 2147d. 71.07 (5) (a) 10. of the statutes is created to read:

SB55-SSA1-SA2,266,19 71.07 (5) (a) 10. Any amount claimed as a credit under sub. (9t).".

SB55-SSA1-SA2,266,20 918. Page 734, line 22: after that line insert:

SB55-SSA1-SA2,266,21 " Section 2147k. 71.07 (2dx) (b) (intro.) of the statutes is amended to read:

SB55-SSA1-SA2,267,3 71.07 (2dx) (b) Credit. (intro.) Except as provided in pars. (be) and (bg) and in s. 73.03 (35), and subject to s. 560.785, for any taxable year for which the person is entitled under s. 560.795 (3) to claim tax benefits or certified under s. 560.765 (3) or 560.797 (4), any person may claim as a credit against taxes imposed on the person's income from the person's business activities in a development zone the following amounts:

SB55-SSA1-SA2, s. 2147m Section 2147m. 71.07 (2dx) (be) of the statutes is created to read:

SB55-SSA1-SA2,267,9 71.07 (2dx) (be) Offset. A claimant in a development zone under s. 560.795 (1) (e) may offset any credits claimed under this subsection, including any credits carried over, against the amount of the tax otherwise due under this subchapter attributable to all of the claimant's income and against the tax attributable to income from directly related business operations of the claimant.

SB55-SSA1-SA2, s. 2147p Section 2147p. 71.07 (2dx) (bg) of the statutes is created to read:

SB55-SSA1-SA2,267,24 71.07 (2dx) (bg) Other entities. For claimants in a development zone under s. 560.795 (1) (e), partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and 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 company shall compute the amount of the 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. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit based on the partnership's, company's, or corporation's activities in proportion to their ownership interest and may offset it against the tax attributable to their income from all of the partnership's, company's, or corporation's business operations and against the tax attributable to their income from the partnership's, company's, or corporation's directly related business operations.".

SB55-SSA1-SA2,268,2 919. Page 734, line 23: delete the material beginning with that line and ending with page 735, line 20.

SB55-SSA1-SA2,268,4 920. Page 736, line 12: delete the material beginning with that line and ending with page 738, line 1.

SB55-SSA1-SA2,268,5 921. Page 737, line 24: after that line insert:

SB55-SSA1-SA2,268,6 " Section 2150d. 71.07 (9t) of the statutes is created to read:

SB55-SSA1-SA2,268,8 71.07 (9t) Artistic endowment credit. (a) Definition. In this subsection, "claimant" means a person who files a claim under this subsection.

SB55-SSA1-SA2,268,16 (b) Filing claims. For taxable years beginning after December 31, 2002, subject to the limitations provided in this subsection, a claimant may claim as a credit against the tax imposed under s. 71.02, up to the amount of those taxes, an amount equal to 25% of the amount contributed to the artistic endowment fund under s. 25.78, up to a maximum $50 contribution in a taxable year for a claimant who claims the credit as an individual or claims the credit as a married person who files a separate income tax return, up to a maximum $100 contribution in a taxable year for a claimant and a claimant's spouse who file a joint return.

SB55-SSA1-SA2,268,18 (c) Limitations and conditions. 1. Nonresidents of this state are not eligible for the credit under this subsection, except as provided under subd. 2.

SB55-SSA1-SA2,269,4 2. For a claimant who is a part-year resident of this state and who is a single person or a married person filing a separate return, multiply the credit for which the claimant is eligible under par. (b) by a fraction, the numerator of which is the individual's Wisconsin adjusted gross income and the denominator of which is the individual's federal adjusted gross income. If a claimant is married and files a joint return, and if the claimant's spouse is a nonresident or if the claimant or the claimant's spouse, or both, are part-year residents of this state, multiply the credit for which the claimant is eligible under par. (b) by a fraction, the numerator of which is the couple's joint Wisconsin adjusted gross income and the denominator of which is the couple's joint federal adjusted gross income.

SB55-SSA1-SA2,269,7 3. No new claim may be filed under this subsection for a taxable year that begins after December 31 of the year in which the department determines that the total amount of revenues received by the endowment fund equals $50,150,000.

SB55-SSA1-SA2,269,9 4. No credit may be allowed under this subsection unless it is claimed within the time period under s. 71.75 (2).

SB55-SSA1-SA2, s. 2150e Section 2150e. 71.10 (4) (dg) of the statutes is created to read:

SB55-SSA1-SA2,269,11 71.10 (4) (dg) The artistic endowment credit under s. 71.07 (9t).".

SB55-SSA1-SA2,269,12 922. Page 737, line 24: after that line insert:

SB55-SSA1-SA2,269,13 " Section 2150e. 71.07 (9) (b) 1. of the statutes is amended to read:

SB55-SSA1-SA2,269,18 71.07 (9) (b) 1. Subject to the limitations under this subsection and except as provided in subds. 2., 4. and, 5., and 6., a claimant may claim as a credit against, but not to exceed the amount of, taxes under s. 71.02, 10% of the first $2,000 of property taxes or rent constituting property taxes, or 10% of the first $1,000 of property taxes or rent constituting property taxes of a married person filing separately.

SB55-SSA1-SA2, s. 2150f Section 2150f. 71.07 (9) (b) 5. of the statutes is amended to read:

SB55-SSA1-SA2,270,2 71.07 (9) (b) 5. For taxable years beginning after December 31, 1999, and before January 1, 2001, subject to the limitations under this subsection a claimant may claim as a credit against, but not to exceed the amount of, taxes under s. 71.02, 12% of the first $2,500 of property taxes or rent constituting property taxes, or 12% of the first $1,250 of property taxes or rent constituting property taxes of a married person filing separately.

SB55-SSA1-SA2, s. 2150g Section 2150g. 71.07 (9) (b) 6. of the statutes is created to read:

SB55-SSA1-SA2,270,9 71.07 (9) (b) 6. For taxable years beginning after December 31, 2000, subject to the limitations under this subsection, a claimant may claim as a credit against, but not to exceed the amount of, taxes under s. 71.02, 13.3% of the first $2,000 of property taxes or rent constituting property taxes, or 13.3% of the first $1,000 of property taxes or rent constituting property taxes of a married person filing separately.".

SB55-SSA1-SA2,270,10 923. Page 738, line 5: delete lines 5 and 6.

SB55-SSA1-SA2,270,12 924. Page 741, line 22: delete "(2dx) and, (3g), and" and substitute "(2dx), and".

SB55-SSA1-SA2,270,13 925. Page 763, line 5: after that line insert:

SB55-SSA1-SA2,270,14 " Section 2160d. 71.25 (5) (a) 9. of the statutes is amended to read:

SB55-SSA1-SA2,270,23 71.25 (5) (a) 9. Interest and dividends if the operations of the payer are unitary with those of the payee, or if those operations are not unitary but the investment activity from which that income is derived is an integral part of a unitary business and the payer and payee are neither affiliates nor related as parent company and subsidiary. In this subdivision, "investment activity" includes decision making relating to the purchase and sale of stocks and other securities, investing surplus funds and the management and record keeping associated with corporate investments, not including activities of a broker or other agent in maintaining an investment portfolio.

SB55-SSA1-SA2, s. 2160e Section 2160e. 71.25 (5) (a) 10. of the statutes is amended to read:

SB55-SSA1-SA2,271,6 71.25 (5) (a) 10. Sale of intangible assets if the operations of the company in which the investment was made were unitary with those of the investing company, or if those operations were not unitary but the investment activity from which that gain or loss was derived is an integral part of a unitary business and the companies were neither affiliates nor related as parent company and subsidiary. In this subdivision, "investment activity" has the meaning given under subd. 9.

SB55-SSA1-SA2, s. 2160g Section 2160g. 71.25 (5) (b) 1. of the statutes is renumbered 71.25 (5) (b).

SB55-SSA1-SA2, s. 2160h Section 2160h. 71.25 (5) (b) 2. of the statutes is repealed.".

SB55-SSA1-SA2,271,10 926. Page 763, line 6: delete the material beginning with that line and ending with page 768, line 6, and substitute:

SB55-SSA1-SA2,271,11 " Section 2169d. 71.25 (9) (a) of the statutes is amended to read:

SB55-SSA1-SA2,271,22 71.25 (9) (a) The sales factor is a fraction, the numerator of which is the total sales of the taxpayer in this state during the tax period, and the denominator of which is the total sales of the taxpayer everywhere during the tax period. For sales of tangible personal property, the numerator of the sales factor is the sales of the taxpayer during the tax period under par. (b) 1. and 2. plus 50% of the sales of the taxpayer during the tax period under pars. (b) 2m. and 3. and (c). For purposes of determining the numerator of the sales factor for a member of a combined reporting group under s. 71.255 (7), "taxpayer" means the member of a combined reporting group, as defined in s. 71.255 (1) (c), that transferred title to tangible personal property or, for sales other than sales of tangible personal property, that made the sale.".

SB55-SSA1-SA2,271,23 927. Page 768, line 16: after that line insert:

SB55-SSA1-SA2,271,24 " Section 2173x. 71.26 (1) (b) of the statutes is amended to read:

SB55-SSA1-SA2,272,5 71.26 (1) (b) Political units. Income received by the United States, the state, the Milwaukee County child welfare district under s. 48.562, and all counties, cities, villages, towns, school districts, technical college districts, joint local water authorities created under s. 66.0823, family care districts under s. 46.2895, or other political units of this state.".

SB55-SSA1-SA2,272,6 928. Page 768, line 16: after that line insert:

SB55-SSA1-SA2,272,7 " Section 2173d. 71.255 of the statutes is created to read:

SB55-SSA1-SA2,272,8 71.255 Combined reporting. (1) Definitions. In this section:

SB55-SSA1-SA2,272,12 (a) "Brother-sister parent corporation" means a parent corporation that is a member of a commonly controlled group, if any members of the commonly controlled group are not connected to the parent corporation by stock ownership as described in par. (d) 1. to 5.

SB55-SSA1-SA2,272,15 (b) "Combined report" means a form prescribed by the department that specifies the income of each taxpayer member of a commonly controlled group operating as a unitary business.

SB55-SSA1-SA2,272,17 (c) "Combined reporting group" means the members of a commonly controlled group that are included in a combined report under sub. (2).

SB55-SSA1-SA2,272,19 (d) "Commonly controlled group" means any of the following, but does not include an insurer that is exempt from taxation under s. 71.45 (1):

SB55-SSA1-SA2,273,2 1. A parent corporation and any corporation or chain of corporations that are connected to the parent corporation by direct or indirect ownership by the parent corporation if the parent corporation owns stock representing more than 50% of the voting power of at least one of the connected corporations or if the parent corporation or any of the connected corporations owns stock that cumulatively represents more than 50% of the voting power of each of the connected corporations.

SB55-SSA1-SA2,273,5 2. Any 2 or more corporations if a common owner directly or indirectly owns stock representing more than 50% of the voting power of the corporations or the connected corporations.

SB55-SSA1-SA2,273,9 3. A partnership or limited liability company if a parent corporation or any corporation connected to the parent corporation by common ownership directly or indirectly owns shares representing more than 50% of the shares of the partnership or limited liability company.

SB55-SSA1-SA2,273,11 4. Any 2 or more corporations if stock representing more than 50% of the voting power in each corporation are interests that cannot be separately transferred.

SB55-SSA1-SA2,273,16 5. Any 2 or more corporations if stock representing more than 50% of the voting power is directly owned by, or for the benefit of, family members. In this subdivision, "family members" means an individual or a spouse related by blood, marriage or adoption within the 2nd degree of kinship as computed under s. 852.03 (2), 1995 stats.

SB55-SSA1-SA2,273,17 (e) "Corporation" has the meaning given in s. 71.22 (1) or 71.42 (1).

SB55-SSA1-SA2,273,18 (f) "Department" means the department of revenue.

SB55-SSA1-SA2,273,20 (g) "Designated agent" means the taxpayer member of a commonly controlled group who files a group return on behalf of the commonly controlled group.

SB55-SSA1-SA2,273,22 (h) "Group return" means a tax return filed on behalf of the taxpayer members of a commonly controlled group.

SB55-SSA1-SA2,274,2 (i) "Intercompany transaction" means a transaction between corporations, partnerships, or limited liability companies that become members of the same commonly controlled group that is engaged in a unitary business immediately after the transaction.

SB55-SSA1-SA2,274,4 (im) "Partnership" means any entity considered a partnership under section 7701 of the Internal Revenue Code.

SB55-SSA1-SA2,274,6 (j) "Separate return" means a return filed by a corporation, regardless of whether the corporation is required to file a tax return under s. 71.24 or 71.44.

SB55-SSA1-SA2,274,9 (k) "Taxpayer member" means a corporation that is subject to tax under s. 71.23 (1) or (2) or 71.43, that is a member of a combined reporting group, and that files a combined report under this section.

SB55-SSA1-SA2,274,15 (L) "Top tier corporation" means a member of a commonly controlled group that is not connected with a parent corporation by stock ownership as described in par. (d) 1. to 5., is a parent corporation, or is a brother-sister parent corporation, regardless of whether it is doing business in this state or deriving income from sources in this state, and regardless of whether its income and apportionment factors are excluded from a combined report filed under this section.

SB55-SSA1-SA2,274,24 (m) "Unitary business" means the business activities or operations of an entity that are of mutual benefit to, integrated with, or dependent upon or contribute to activities of at least one other entity, including transactions that serve an operational function, as determined by the department. Two or more businesses are presumed to be a unitary business if the businesses have unity of ownership, operation, and use as indicated by centralized management or a centralized executive force; centralized purchasing, advertising, or accounting; intercorporate sales or leases; intercorporate services; intercorporate debts; intercorporate use of proprietary materials; interlocking directorates; or interlocking corporate officers.

SB55-SSA1-SA2,275,8 (2) Corporations required to use combined reporting. (a) Except as provided in par. (b), a corporation that is subject to the tax imposed under s. 71.23 (1) or (2) or 71.43, that is a member of a commonly controlled group, and that is engaged, in whole or in part, in a unitary business with one or more members of the commonly controlled group shall compute the corporation's income attributable to this state by using the income computation under s. 71.26 or 71.45, the apportionment formula under s. 71.25 (6) or 71.45 (3) and (3m), and the tax credits under s. 71.28 or 71.47 of all of the following that are members of the commonly controlled group:

SB55-SSA1-SA2,275,13 1. Any corporation organized or incorporated under the laws of the United States, any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, any possession of the United States, or any subdivision of the United States, including corporations under sections 931 to 936 of the Internal Revenue Code.