Amendment ASA1-AB100

AB100-ASA1,686,25 71.47 (4) (a) Credit. Any corporation may credit against taxes otherwise due under this chapter an amount equal to 5% of the amount obtained by subtracting from the corporation's qualified research expenses, as defined in section 41 of the internal revenue code, except that "qualified research expenses" includes only expenses incurred by the claimant, incurred for research conducted in this state for the taxable year, except that a taxpayer may elect the alternative computation under section 41 (c) (4) of the Internal Revenue Code and that election applies until the department permits its revocation and except that "qualified research expenses" does not include compensation used in computing the credit under subs. (1dj) and (1dx), the corporation's base amount, as defined in section 41 (c) of the internal revenue code, except that gross receipts used in calculating the base amount means gross receipts from sales attributable to Wisconsin under s. 71.25 (9) (b) 1. and 2. and, (d), (df), and (dh). Section 41 (h) of the internal revenue code does not apply to the credit under this paragraph.

AB100-ASA1, s. 1427 Section 1427. 71.47 (4) (am) of the statutes is amended to read:

AB100-ASA1,688,4 71.47 (4) (am) Development zone additional research credit. In addition to the credit under par. (a), any corporation may credit against taxes otherwise due under this chapter an amount equal to 5% of the amount obtained by subtracting from the corporation's qualified research expenses, as defined in section 41 of the internal revenue code, except that "qualified research expenses" include only expenses incurred by the claimant in a development zone under subch. VI of ch. 560, except that a taxpayer may elect the alternative computation under section 41 (c) (4) of the Internal Revenue Code and that election applies until the department permits its revocation and except that "qualified research expenses" do not include compensation used in computing the credit under sub. (1dj) nor research expenses incurred before the claimant is certified for tax benefits under s. 560.765 (3), the corporation's base amount, as defined in section 41 (c) of the internal revenue code, in a development zone, except that gross receipts used in calculating the base amount means gross receipts from sales attributable to Wisconsin under s. 71.25 (9) (b) 1. and 2. and, (d), (df), and (dh) and research expenses used in calculating the base amount include research expenses incurred before the claimant is certified for tax benefits under s. 560.765 (3), in a development zone, if the claimant submits with the claimant's return a copy of the claimant's certification for tax benefits under s. 560.765 (3) and a statement from the department of commerce verifying the claimant's qualified research expenses for research conducted exclusively in a development zone. The rules under s. 73.03 (35) apply to the credit under this paragraph. The rules under sub. (1di) (f) and (g) as they apply to the credit under that subsection apply to claims under this paragraph. Section 41 (h) of the internal revenue code does not apply to the credit under this paragraph. No credit may be claimed under this paragraph for taxable years that begin on January 1, 1998, or thereafter. Credits under this paragraph for taxable years that begin before January 1, 1998, may be carried forward to taxable years that begin on January 1, 1998, or thereafter.

AB100-ASA1, s. 1428 Section 1428. 71.47 (4) (i) of the statutes is amended to read:

AB100-ASA1,688,11 71.47 (4) (i) Nonclaimants. The credits under this subsection may not be claimed by a partnership, except a publicly traded partnership treated as a corporation under s. 71.22 (1) (1k), limited liability company, except a limited liability company treated as a corporation under s. 71.22 (1) (1k), or tax-option corporation or by partners, including partners of a publicly traded partnership, members of a limited liability company or shareholders of a tax-option corporation.

AB100-ASA1, s. 1428k Section 1428k. 71.47 (5g) of the statutes is created to read:

AB100-ASA1,688,15 71.47 (5g) Health insurance risk-sharing plan assessments credit. (a) Definitions. In this subsection, "claimant" means an insurer, as defined in s. 149.10 (5), who files a claim under this subsection.

AB100-ASA1,688,20 (b) Filing claims. Subject to the limitations provided under this subsection, for taxable years beginning after December 31, 2005, a claimant may claim as a credit against the taxes imposed under s. 71.43 an amount that is equal to a percentage of the amount of assessment under s. 149.13 that the claimant paid in the taxable year, as determined under par. (c) 1.

AB100-ASA1,688,25 (c) Limitations. 1. The department of revenue, in consultation with the office of the commissioner of insurance, shall determine the percentage under par. (b) for each claimant for each taxable year so that the cost of the credit under this subsection and ss. 71.07 (5g), 71.28 (5g), and 76.655 is as close as practicable to $2,000,000 in the 2006-07 fiscal year and $5,000,000 in each fiscal year thereafter.

AB100-ASA1,689,8 2. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and the amount of, the credit are based on their payment of amounts described under par. (b). A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their ownership interests.

AB100-ASA1,689,10 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under s. 71.28 (4), applies to the credit under this subsection.

AB100-ASA1, s. 1428p Section 1428p. 71.49 (1) (dm) of the statutes is created to read:

AB100-ASA1,689,13 71.49 (1) (dm) Health insurance risk-sharing plan assessments credit under s. 71.47 (5g).

AB100-ASA1, s. 1429 Section 1429. 71.58 (1) (c) of the statutes is amended to read:

AB100-ASA1,689,16 71.58 (1) (c) For partnerships except publicly traded partnerships treated as corporations under s. 71.22 (1) (1k), "claimant" means each individual partner.

AB100-ASA1, s. 1430 Section 1430. 71.58 (1) (cm) of the statutes is amended to read:

AB100-ASA1,689,20 71.58 (1) (cm) For limited liability companies, except limited liability companies treated as corporations under s. 71.22 (1) (1k), "claimant" means each individual member.

AB100-ASA1, s. 1430m Section 1430m. 71.67 (5) (a) of the statutes is amended to read:

AB100-ASA1,690,2 71.67 (5) (a) Wager winnings. A person holding a license to sponsor and manage races under s. 562.05 (1) (b), (bm), or (c) shall withhold from the amount of any payment of pari-mutuel winnings under s. 562.065 (3) (a) or (3m) (a) an amount determined by multiplying the amount of the payment by the highest rate applicable to individuals under s. 71.06 (1) (a) to (c), (1m), (1n) or (1p) if the amount of the payment is more than $1,000.

AB100-ASA1, s. 1430o Section 1430o. 71.67 (5) (b) of the statutes is amended to read:

AB100-ASA1,690,6 71.67 (5) (b) Deposits. The licensee under s. 562.05 (1) (b), (bm), or (c) shall deposit the amounts withheld under this subsection as would an employer depositing under s. 71.65 (3).

AB100-ASA1, s. 1431 Section 1431. 71.775 of the statutes is created to read:

AB100-ASA1,690,9 71.775 Withholding from nonresident members of pass-through entities. (1) Definitions. In this section:

AB100-ASA1,690,13 (a) "Nonresident" includes an individual who is not domiciled in this state; a partnership, limited liability company, or corporation whose commercial domicile is outside the state; and an estate or a trust that is a nonresident under s. 71.14 (1) to (3m).

AB100-ASA1,690,16 (b) "Pass-through entity" means a partnership, a limited liability company, a tax-option corporation, an estate, or a trust that is treated as a pass-through entity for federal income tax purposes.

AB100-ASA1,690,24 (2) Withholding tax imposed. (a) For the privilege of doing business in this state or deriving income from property located in this state, a pass-through entity that has Wisconsin income for the taxable year that is allocable to a nonresident partner, member, shareholder, or beneficiary shall pay a withholding tax. The amount of the tax imposed under this subsection to be withheld from the income distributable to each nonresident partner, member, shareholder, or beneficiary is equal to the nonresident partner's, member's, shareholder's, or beneficiary's share of income attributable to this state, multiplied by the following:

AB100-ASA1,691,2 1. For an individual, an estate, or a trust that is a pass-through entity, the highest tax rate for a single individual for the taxable year under s. 71.06.

AB100-ASA1,691,4 2. For a partnership, a limited liability company, or a tax-option corporation that is a pass-through entity, the highest tax rate for the taxable year under s. 71.27.

AB100-ASA1,691,8 (b) A pass-through entity that is also a member of another pass-through entity is subject to withholding under this subsection and shall pay the tax based on the share of income that is distributable to each of the entity's nonresident partners, members, shareholders, or beneficiaries.

AB100-ASA1,691,12 (3) Exemptions. (a) A nonresident partner's, member's, shareholder's, or beneficiary's share of income from the pass-through entity that is attributable to this state shall not be included in determining the withholding under sub. (2) if any of the following applies:

AB100-ASA1,691,20 1. The partner, member, shareholder, or beneficiary is exempt from taxation under this chapter. For purposes of this subdivision, the pass-through entity may rely on a written statement from the partner, member, shareholder, or beneficiary claiming to be exempt from taxation under this chapter, if the pass-through entity attaches a copy of the statement to its return for the taxable year and if the statement specifies the name, address, federal employer identification number, and reason for claiming an exemption for each partner, member, shareholder, or beneficiary claiming to be exempt from taxation under this chapter.

AB100-ASA1,691,23 2. The partner, member, shareholder, or beneficiary has no Wisconsin income other than his or her share of income from the pass-through entity that is attributable to this state and his or her share of such income is less than $1,000.

AB100-ASA1,692,3 (b) A pass-through entity that is a joint venture is not subject to the withholding under sub. (2), if the pass-through entity has elected not to be treated as a partnership under section 761 of the Internal Revenue Code.

AB100-ASA1,692,10 (cm) A pass-through entity that is a publicly traded partnership, as defined under section 7704 (b) of the Internal Revenue Code, that is treated as a partnership under the Internal Revenue Code is not subject to the withholding under sub. (2), if the entity files with the department an information return that reports the name, address, taxpayer identification number, and any other information requested by the department for each unit holder with an income in this state from the entity in excess of $500.

AB100-ASA1,692,13 (4) Administration. (a) Each pass-through entity that is subject to the withholding under sub. (2) shall pay the amount of the tax withheld to the department no later than:

AB100-ASA1,692,15 1. For tax-option corporations, the 15th day of the 3rd month following the close of the taxable year.

AB100-ASA1,692,17 2. For partnerships, limited liability companies, estates, and trusts, the 15th day of the 4th month following the close of the taxable year.

AB100-ASA1,692,20 (b) 1. If the pass-through entity has an extension of time to file its return, the tax withheld under sub. (2) is due on the unextended due date of the entity's return as provided under s. 71.13 (1), 71.20 (1), or 71.24 (1).

AB100-ASA1,693,6 2. A pass-through entity that pays the tax withheld under sub. (2) as provided under subd. 1. is not subject to an underpayment of estimated tax under s. 71.09 or 71.29, if 90 percent of the tax that is due for the current taxable year is paid by the unextended due date or if 100 percent of the tax that is due for the taxable year immediately preceding the current taxable year is paid by the unextended due date and the taxable year immediately preceding the current taxable year was a 12-month period. Interest at the rate 12 percent shall be imposed on the unpaid amount of the tax withheld under sub. (2) during any extension period and interest at the rate of 18 percent shall be imposed on the unpaid amount of the tax withheld under sub. (2) for the period beginning with the extended due date and ending with the date that the unpaid amount is paid in full.

AB100-ASA1,693,13 (c) On or before the due date, including extensions, of the entity's return, a pass-through entity that withholds tax under sub. (2) shall annually notify each of its nonresident partners, members, shareholders, or beneficiaries of the amount of the tax withheld under sub. (2) that the pass-through entity paid on the nonresident partner's, member's, shareholder's, or beneficiary's behalf. The pass-through entity shall provide a copy of the notice to the department with the return that it files for the taxable year.

AB100-ASA1,693,19 (d) A nonresident partner, member, shareholder, or beneficiary of a pass-through entity may claim a credit, as prescribed by the department, on his or her Wisconsin income or franchise tax return for the amount withheld under sub. (2) on his or her behalf. For purposes of this paragraph, the amount withheld under sub. (2) is considered to be paid on the last day of the pass-through entity's taxable year for which the tax is paid.

AB100-ASA1,693,25 (e) Any tax withheld under this section shall be held in trust for this state, and a pass-through entity subject to withholding under this section shall be liable to the department for the payment of the tax withheld. No partner, member, shareholder, or beneficiary of a pass-through entity shall have any right of action against the pass-through entity with respect to any amount withheld and paid in compliance with this section.

AB100-ASA1,694,7 (f) If a pass-through entity subject to withholding under this section fails to withhold tax as required by this section, the pass-through entity shall be liable for any tax, interest, and penalties. If a nonresident partner, member, shareholder, or beneficiary of the pass-through entity files a return and pays the tax due, the pass-through entity shall not be liable for the tax, but shall be liable for any interest and penalties otherwise applicable for failure to withhold, as provided under ss. 71.82 (2) (d) and 71.83.

AB100-ASA1, s. 1431s Section 1431s. 71.78 (2) of the statutes is amended to read:

AB100-ASA1,694,25 71.78 (2) Disclosure of net tax. The department shall make available upon suitable forms prepared by the department information setting forth the net Wisconsin income tax, Wisconsin franchise tax or Wisconsin gift tax reported as paid or payable in the returns filed by any individual or corporation, and any amount of delinquent taxes owed, as described in s. 73.03 (62), by any such individual or corporation, for any individual year upon request. Before the request is granted, the person desiring to obtain the information shall prove his or her identity and shall be required to sign a statement setting forth the person's address and reason for making the request and indicating that the person understands the provisions of this section with respect to the divulgement, publication or dissemination of information obtained from returns as provided in sub. (1). The use of a fictitious name is a violation of this section. Within 24 hours after any information from any such tax return has been so obtained, the department shall mail to the person from whose return the information has been obtained a notification which shall give the name and address of the person obtaining the information and the reason assigned for requesting the information. The department shall collect from the person requesting the information a fee of $4 for each return.

AB100-ASA1, s. 1432c Section 1432c. 71.78 (4) (r) of the statutes is created to read:

AB100-ASA1,695,5 71.78 (4) (r) The secretary of revenue and employees of that department for the purpose of preparing and maintaining the list of persons with unpaid tax obligations as described in s. 73.03 (62) so that the list of such persons is available for public inspection.

AB100-ASA1, s. 1432m Section 1432m. 71.83 (1) (ce) of the statutes is created to read:

AB100-ASA1,695,11 71.83 (1) (ce) Health savings accounts. Any person who is liable for a penalty for federal income tax purposes under section 223 (f) (4) of the Internal Revenue Code is liable for a penalty equal to 33 percent of that penalty. The department of revenue shall assess, levy, and collect the penalty under this paragraph as it assesses, levies, and collects taxes under this chapter.

AB100-ASA1, s. 1434 Section 1434. 71.93 (1) (a) 1. of the statutes is amended to read:

AB100-ASA1,695,15 71.93 (1) (a) 1. An amount owed to a state agency that, if the amount has been reduced to a judgment or if the state agency has provided the debtor reasonable notice and an opportunity to be heard with regards to the amount owed.

AB100-ASA1, s. 1435 Section 1435. 71.93 (1) (a) 3. of the statutes is amended to read:

AB100-ASA1,695,19 71.93 (1) (a) 3. An amount that the department of health and family services may recover under s. 49.45 (2) (a) 10. or, 49.497, 49.793, or 49.847, if the department of health and family services has certified the amount under s. 49.85.

AB100-ASA1, s. 1436 Section 1436. 71.93 (1) (a) 4. of the statutes is amended to read:

AB100-ASA1,695,24 71.93 (1) (a) 4. An amount that the department of workforce development may recover under s. 49.161, or 49.195 (3), or 49.793, or may collect under s. 49.147 (6) (cm), if the department of workforce development has certified the amount under s. 49.85.

AB100-ASA1, s. 1437 Section 1437. 71.93 (1) (cm) of the statutes is created to read:

AB100-ASA1,696,2 71.93 (1) (cm) "Disbursement" means any payment to a person who provides goods and services to the state under subch. IV or V of ch. 16 or under ch. 84.

AB100-ASA1, s. 1438 Section 1438. 71.93 (2) of the statutes is amended to read:

AB100-ASA1,696,12 71.93 (2) Certification. A state agency may certify to the department for setoff any properly identified debt exceeding $20 so that the department may set off the amount of the debt against a refund to the debtor or so that the department of administration may reduce a disbursement to the debtor by the amount of the debt. At least 30 days prior to certification each debtor shall be sent a notice by the state agency of its intent to certify the debt to the department for setoff or reduction and of the debtor's right of appeal. At the time of certification, the certifying state agency shall furnish the social security number of individual debtors and the federal employer identification number of other debtors.

AB100-ASA1, s. 1439 Section 1439. 71.93 (3) of the statutes is renumbered 71.93 (3) (a) and amended to read:

AB100-ASA1,697,3 71.93 (3) (a) Administration. In administering this section the department shall first check with the state agency certifying the debt to determine whether the debt has been collected by other means. If the debt remains uncollected the department of revenue shall setoff any debt or other amount owed to the department, regardless of the origin of the debt or of the amount, its nature or its date. If after the setoff there remains a refund in excess of $10, the department shall set off the remaining refund against certified debts of other state agencies. If more than one certified debt exists for any debtor, the refund shall be first set off against the earliest debt certified, except that no child support or spousal support obligation submitted by an agency of another state may be set off until all debts owed to and certified by state agencies of this state have been set off. When all debts have been satisfied, any remaining refund shall be refunded to the debtor by the department. Any legal action contesting a setoff under this paragraph shall be brought against the state agency that certified the debt under sub. (2).

AB100-ASA1, s. 1440 Section 1440. 71.93 (3) (b) of the statutes is created to read:

AB100-ASA1,697,17 71.93 (3) (b) The department shall provide the information obtained under sub. (2) to the department of administration. Before reducing any disbursement as provided under this paragraph, the department of administration shall contact the department to verify whether a certified debt that is the basis of the reduction has been collected by other means. If the certified debt remains uncollected, the department of administration shall reduce the disbursement by the amount of the debtor's certified debt under sub. (2), notify the department of such reduction and disbursement, and remit the amount of the reduction to the department in the manner prescribed by the department. If more than one certified debt exists for any debtor, the disbursement shall be reduced first by any debts certified under s. 73.12 then by the earliest debt certified. Any legal action contesting a reduction under this paragraph shall be brought against the state agency that certified the debt under sub. (2).

AB100-ASA1, s. 1441 Section 1441. 71.93 (4) of the statutes is amended to read:

AB100-ASA1,697,23 71.93 (4) Settlement. Within 30 days after the close of each calendar quarter, the department shall settle with each state agency that has certified a debt. Each settlement shall note the opening balance of debts certified, any additions or deletions, reductions or amounts set off, and the ending balance at the close of the settlement period.

AB100-ASA1, s. 1442 Section 1442. 71.93 (5) of the statutes is amended to read:

AB100-ASA1,698,6 71.93 (5) State agency charged for costs. At the time of each settlement, each state agency shall be charged for administration expenses, and the amounts charged shall be credited to the department's appropriation under s. 20.566 (1) (h). Annually on or before November 1, the department shall review its costs incurred during the previous fiscal year in administering state agency setoffs and reductions and shall adjust its subsequent charges to each state agency to reflect that experience.

AB100-ASA1, s. 1443 Section 1443. 71.93 (6) of the statutes is amended to read:

AB100-ASA1,698,15 71.93 (6) Written agreement and authority of department. Any state agency wishing to certify debts to the department shall enter into a written agreement with the department prior to any certification of debt. Any certification of debts by a state agency or changes to certified debts shall be in a manner and form prescribed by the department. The secretary of revenue shall be the final authority in the resolution of any interagency disputes in regard to certification of debts. If a refund or disbursement is adjusted after a setoff or reduction, the department may readjust any erroneous settlement with a certifying state agency.

AB100-ASA1, s. 1444 Section 1444. 71.93 (7) of the statutes is amended to read:

AB100-ASA1,698,21 71.93 (7) Exchange of information. Information relative to changes to any debt certified shall be exchanged promptly by each agency and the department setoff. Setoff of refunds and reduction of disbursements against debts certified by agencies, and any reports report of the setoff or reduction to certifying state agencies, is not a violation of ss. 71.78, 72.06, 77.61 (5), 78.80 (3), and 139.38 (6).

AB100-ASA1, s. 1445 Section 1445. 71.935 (1) (cm) of the statutes is created to read:

AB100-ASA1,698,24 71.935 (1) (cm) "Disbursement" means any payment to a person who provides goods and services to the state under subch. IV or V of ch. 16 or under ch. 84.

AB100-ASA1, s. 1446 Section 1446. 71.935 (2) of the statutes is amended to read:

AB100-ASA1,699,8 71.935 (2) A municipality or county may certify to the department any debt owed to it. Not later than 5 days after certification, the municipality or county shall notify the debtor in writing of its certification of the debt to the department, of the basis of the certification and of the debtor's right to appeal and, in the case of parking citations, of the debtor's right to contest the citation. At the time of certification, the municipality or county shall furnish to the department the name and social security number or operator's license number of each individual debtor and the name and federal employer identification number of each other debtor.

AB100-ASA1, s. 1447 Section 1447. 71.935 (3) of the statutes is renumbered 71.935 (3) (a) and amended to read:

AB100-ASA1,699,15 71.935 (3) (a) If the debt remains uncollected and, in the case of a parking citation, if the debtor has not contested the citation within 20 days after the notice under sub. (2), the department shall set off the debt against any refund that is owed to the debtor after the setoff under s. 71.93. Any legal action contesting a setoff shall be brought against the municipality or county that certified the debt under sub. (2).

AB100-ASA1, s. 1448 Section 1448. 71.935 (3) (b) of the statutes is created to read:

AB100-ASA1,700,7 71.935 (3) (b) The department shall provide the information obtained under sub. (2) to the department of administration. Before reducing any disbursement as provided under this paragraph, the department of administration shall contact the department to verify whether a certified debt that is the basis of the reduction has been collected by other means and, in the case of a parking citation, whether the debtor has contested the citation within 20 days after the notice under sub. (2). If the certified debt remains uncollected and, in the case of a parking citation, the citation has not been contested within 20 days after the notice under sub. (2), the department of administration shall, after any reduction under s. 71.93, reduce the disbursement by the amount of the debtor's certified debt under sub. (2), notify the department of such reduction and disbursement, and remit the amount of the reduction to the department in the manner prescribed by the department. If more than one debt certified under sub. (2) exists for any debtor, the disbursement shall be reduced first by the earliest debt certified. Any legal action contesting a reduction under this paragraph shall be brought against the municipality or county that certified the debt under sub. (2).

AB100-ASA1, s. 1449 Section 1449. 71.935 (4) of the statutes is amended to read:

AB100-ASA1,700,12 71.935 (4) Within 30 days after the end of each calendar quarter, the department shall settle with each municipality and county for the amounts that the department setoff set off or reduced against certified debts for the municipality or county during that calendar quarter.

AB100-ASA1, s. 1450 Section 1450. 71.935 (5) of the statutes is amended to read:

AB100-ASA1,700,19 71.935 (5) At the time of each settlement, each municipality and county shall be charged for administration expenses, and the amounts charged shall be credited to the appropriation account under s. 20.566 (1) (h). Annually on or before November 1, the department shall review its costs incurred during the previous fiscal year in administering setoffs and reductions under this section and shall adjust its subsequent charges to each municipality and county to reflect that experience.

AB100-ASA1, s. 1450g Section 1450g. Subchapter XVI of chapter 71 [precedes 71.98] of the statutes is created to read:

AB100-ASA1,700,22 Chapter 71

AB100-ASA1,700,24 subchapter xvi Internal revenue code update

AB100-ASA1,701,2 71.98 Internal Revenue Code update. The following federal laws, to the extent that they apply to the Internal Revenue Code, apply to this chapter:

AB100-ASA1,701,4 (1) Health savings accounts. Section 1201 of P.L. 108-173, relating to health savings accounts.

AB100-ASA1, s. 1456c Section 1456c. 73.03 (62) of the statutes is created to read: