SB268-SSA1,9,2419 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
20computed under s. 71.47 (1dd) to (1dx) and (5r) and not passed through by a
21partnership, limited liability company, or tax-option corporation that has added that
22amount to the partnership's, limited liability company's, or tax-option corporation's
23income under s. 71.21 (4) or 71.34 (1) (g) and the amount of credit computed under
24s. 71.47 (1), (3), (3t), (4), and (5).
SB268-SSA1, s. 10 25Section 10. 71.47 (5r) of the statutes is created to read:
SB268-SSA1,10,1
171.47 (5r) Education credit. (a) In this subsection:
SB268-SSA1,10,22 1. "Claimant" means a corporation that files a claim under this subsection.
SB268-SSA1,10,43 2. "Degree-granting program" means an educational program for which an
4associate, a bachelor's, or a graduate degree is awarded upon successful completion.
SB268-SSA1,10,55 3. "Family member" has the meaning given in s. 157.061 (7).
SB268-SSA1,10,86 4. "Managing employee" means an individual who wholly or partially exercises
7operational or managerial control over, or who directly or indirectly conducts, the
8operation of the claimant's business.
SB268-SSA1,10,99 5. "Poverty line" has the meaning given under s. 49.001 (5).
SB268-SSA1,10,1010 6. "Qualified postsecondary institution" means all of the following:
SB268-SSA1,10,1311 a. A University of Wisconsin System institution, a technical college system
12institution, or a regionally accredited 4-year nonprofit college or university having
13its regional headquarters and principal place of business in this state.
SB268-SSA1,10,1514 b. A school approved under s. 45.54, if the school has a physical presence, and
15the delivery of education occurs, in this state.
SB268-SSA1,10,1716 (b) Subject to the limitations provided in this subsection, a claimant may claim
17as a credit against the tax imposed under s. 71.43 an amount equal to the following:
SB268-SSA1,10,2118 1. Fifty percent of the tuition that the claimant paid or incurred during the
19taxable year for an individual to participate in an education program of a qualified
20postsecondary institution, if the individual was enrolled in a degree-granting
21program.
SB268-SSA1,11,222 2. Seventy five percent of the tuition that the claimant paid or incurred during
23the taxable year for an individual to participate in an education program of a
24qualified postsecondary institution, if the individual was enrolled in a
25degree-granting program and if the individual's taxable income in the year prior to

1commencing participation in the education program in connection with which a
2credit is claimed is not more than 185% of the poverty line.
SB268-SSA1,11,73 (bm) 1. No credit may be allowed under par. (b) unless the claimant obtains
4written certification from a qualified postsecondary institution concerning the
5amount of tuition that the claimant paid or incurred during the taxable year for an
6individual to participate in an education program of the qualified postsecondary
7institution and includes a copy of the certification with the claimant's return.
SB268-SSA1,11,178 2. No credit may be allowed under par. (b) 2. unless the claimant obtains
9written certification from a qualified postsecondary institution that the taxable
10income of the individual for whom the claimant has paid or incurred tuition during
11the taxable year for the individual to participate in an education program of the
12qualified postsecondary institution is not more than 185% of the poverty line and
13includes a copy of the certification with the claimant's return. For purposes of this
14subdivision and par. (b) 2., if an individual for whom the claimant has paid or
15incurred tuition is claimed as a dependent on another person's tax return, the
16individual's taxable income shall be the taxable income of the person on whose return
17the individual is claimed as a dependent.
SB268-SSA1,11,2018 3. No credit maybe allowed under par. (b) unless the claimant certifies to the
19department of revenue that the claimant will not be reimbursed for any amount of
20tuition for which the claimant claims a credit under par. (b).
SB268-SSA1,11,2221 (c) A claimant may not claim the credit under par. (b) for any tuition amounts
22that the claimant excluded under section 127 of the Internal Revenue Code.
SB268-SSA1,11,2523 (cm) A claimant may not claim the credit under par. (b) for any tuition amounts
24that the claimant paid or incurred for a family member of a managing employee
25unless all of the following apply:
SB268-SSA1,12,4
11. The family member was employed an average of at least 20 hours a week as
2an employee of the claimant, or the claimant's business, during the one-year period
3prior to commencing participation in the education program in connection with
4which the claimant claims a credit under par. (b).
SB268-SSA1,12,65 2. The family member is enrolled in a degree-granting program that is
6substantially related to the claimant's business.
SB268-SSA1,12,87 3. The family member is making satisfactory progress towards completing the
8degree-granting program under subd. 2.
SB268-SSA1,12,109 (d) The carry-over provisions of s. 71.28 (4) (e) and (f), as they apply to the credit
10under s. 71.28 (4), apply to the credit under this subsection.
SB268-SSA1,12,1811 (e) Partnerships, limited liability companies, and tax-option corporations may
12not claim the credit under this subsection, but the eligibility for, and the amount of,
13the credit are based on their payment of tuition under par. (b). A partnership, limited
14liability company, or tax-option corporation shall compute the amount of credit that
15each of its partners, members, or shareholders may claim and shall provide that
16information to each of them. Partners, members of limited liability companies, and
17shareholders of tax-option corporations may claim the credit in proportion to their
18ownership interest.
SB268-SSA1,12,2019 (f) Section 71.28 (4) (g) and (h), as it applies to the credit under s. 71.28 (4),
20applies to the credit under this subsection.
SB268-SSA1,12,2521 (g) The department of revenue shall biennially submit a report to the
22legislature under s. 13.172 (2) that identifies each qualified postsecondary
23institution for which it has received written certification from a claimant under par.
24(bm). The report shall specify the total amount of the tuition for each such institution
25that is claimed as a credit under this subsection in the previous biennium.
SB268-SSA1, s. 11
1Section 11. 71.49 (1) (dm) of the statutes is created to read:
SB268-SSA1,13,22 71.49 (1) (dm) The education credit under s. 71.47 (5r).
SB268-SSA1, s. 12 3Section 12. 77.92 (4) of the statutes, as affected by 2003 Wisconsin Act 99, is
4amended to read:
SB268-SSA1,13,195 77.92 (4) "Net business income", with respect to a partnership, means taxable
6income as calculated under section 703 of the Internal Revenue Code; plus the items
7of income and gain under section 702 of the Internal Revenue Code, including taxable
8state and municipal bond interest and excluding nontaxable interest income or
9dividend income from federal government obligations; minus the items of loss and
10deduction under section 702 of the Internal Revenue Code, except items that are not
11deductible under s. 71.21; plus guaranteed payments to partners under section 707
12(c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de),
13(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g), (3s), and (3t), and (5r); and plus or
14minus, as appropriate, transitional adjustments, depreciation differences, and basis
15differences under s. 71.05 (13), (15), (16), (17), and (19); but excluding income, gain,
16loss, and deductions from farming. "Net business income", with respect to a natural
17person, estate, or trust, means profit from a trade or business for federal income tax
18purposes and includes net income derived as an employee as defined in section 3121
19(d) (3) of the Internal Revenue Code.
SB268-SSA1, s. 13 20Section 13. Initial applicability.
SB268-SSA1,13,2221 (1) Education credit. This act first applies to taxable years beginning on
22January 1, 2006.
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