Amendment SSA1-SB461

SB461-SSA1, s. 3 Section 3. 71.10 (4) (fm) of the statutes is created to read:

SB461-SSA1,5,6 71.10 (4) (fm) New markets credit under s. 71.07 (5n).

SB461-SSA1, s. 4 Section 4. 71.28 (5n) of the statutes is created to read:

SB461-SSA1,5,9 71.28 (5n) New markets credit. (a) Definition. In this subsection, "claimant" means a person who files a claim under this subsection.

SB461-SSA1,5,14 (b) Filing claims. Subject to the limitations provided under this subsection and s. 560.2065, for investments made after December 31, 2010, a claimant may claim as a credit against the taxes imposed under s. 71.23, up to the amount of the taxes, the amount of the claimant's qualified equity investment, as certified under s. 560.2065 (2), multiplied by the following percentage:

SB461-SSA1,5,16 1. For the taxable year that corresponds to the first credit allowance date, as defined under 26 USC 45D (a) (3), zero percent.

SB461-SSA1,5,19 2. For the taxable years that correspond to the 6 credit allowance dates, as defined under 26 USC 45D (a) (3), following the credit allowance date described in subd. 1., 3 percent.

SB461-SSA1,6,13 (c) Limitations. 1. A partnership, limited liability company, or tax-option corporation may not claim the credit under this subsection. The partners of a partnership, members of a limited liability company, or shareholders in a tax-option corporation may claim the credit under this subsection based on eligible costs incurred by the partnership, company, or tax-option corporation. The partnership, limited liability company, or tax-option corporation shall calculate the amount of the credit which may be claimed by each partner, member, or shareholder and shall provide that information to the partner, member, or shareholder. For shareholders of a tax-option corporation, the credit may be allocated in proportion to the ownership interest of each shareholder. Credits computed by a partnership or limited liability company may be claimed in proportion to the ownership interests of the partners or members or allocated to partners or members as provided in a written agreement among the partners or members that is entered into no later than the last day of the taxable year of the partnership or limited liability company, for which the credit is claimed. Any partner or member who claims the credit as provided under this paragraph shall attach a copy of the agreement, if applicable, to the tax return on which the credit is claimed. A person claiming the credit as provided under this paragraph is solely responsible for any tax liability arising from a dispute with the department of revenue related to claiming the credit.

SB461-SSA1,6,20 2. Any claimant who transfers an interest in a partnership, limited liability company, or tax-option corporation after the first credit allowance date, as defined under 26 USC 45D (b), but before the final credit allowance date for the credit allowed under this subsection shall be entitled to claim the credit for the remaining credit allowance dates by filing with the claimant's return a written agreement between the claimant and the transferee of the interest that specifies that the claimant, not the transferee, is the person entitled to claim the credit.

SB461-SSA1,6,23 3. The Wisconsin adjusted basis of any investment for which a credit is claimed under par. (b) shall be reduced by the amount of the credit that is offset against Wisconsin income taxes.

SB461-SSA1,6,25 4. The limitation under section 469 (a) (1) (B) of the Internal Revenue Code does not apply to the credit under this subsection.

SB461-SSA1,7,2 5. A claimant may claim the credit under this subsection regardless of whether the claimant claims a credit under 26 USC 45D.

SB461-SSA1,7,4 (d) Administration. 1. Subsection (4) (e) to (h), as it applies to the credit under sub. (4), applies to the credit under this subsection.

SB461-SSA1,7,9 2. The department of revenue may promulgate rules regarding the recapture of tax credits claimed under this subsection, consistent with 26 USC 45D (g). If a claimant's federal tax credit under 26 USC 45D is subject to recapture under 26 USC 45D (g), the claimant's tax credit under this subsection is subject to recapture at the same time and in the same manner as the claimant's federal tax credit.

SB461-SSA1,7,12 3. No credit may be allowed under this subsection unless the claimant includes with the claimant's return a copy of the claimant's certification for tax benefits under s. 560.2065 (2) (b).

SB461-SSA1, s. 5 Section 5. 71.30 (3) (dn) of the statutes is created to read:

SB461-SSA1,7,14 71.30 (3) (dn) New markets credit under s. 71.28 (5n).

SB461-SSA1, s. 6 Section 6. 71.47 (5n) of the statutes is created to read:

SB461-SSA1,7,17 71.47 (5n) New markets credit. (a) Definition. In this subsection, "claimant" means a person who files a claim under this subsection.

SB461-SSA1,7,22 (b) Filing claims. Subject to the limitations provided under this subsection and s. 560.2065, for investments made after December 31, 2010, a claimant may claim as a credit against the taxes imposed under s. 71.43, up to the amount of the taxes, the amount of the claimant's qualified equity investment, as certified under s. 560.2065 (2), multiplied by the following percentage:

SB461-SSA1,7,24 1. For the taxable year that corresponds to the first credit allowance date, as defined under 26 USC 45D (a) (3), zero percent.

SB461-SSA1,8,3 2. For the taxable years that correspond to the 6 credit allowance dates, as defined under 26 USC 45D (a) (3), following the credit allowance date described in subd. 1., 3 percent.

SB461-SSA1,8,22 (c) Limitations. 1. A partnership, limited liability company, or tax-option corporation may not claim the credit under this subsection. The partners of a partnership, members of a limited liability company, or shareholders in a tax-option corporation may claim the credit under this subsection based on eligible costs incurred by the partnership, company, or tax-option corporation. The partnership, limited liability company, or tax-option corporation shall calculate the amount of the credit which may be claimed by each partner, member, or shareholder and shall provide that information to the partner, member, or shareholder. For shareholders of a tax-option corporation, the credit may be allocated in proportion to the ownership interest of each shareholder. Credits computed by a partnership or limited liability company may be claimed in proportion to the ownership interests of the partners or members or allocated to partners or members as provided in a written agreement among the partners or members that is entered into no later than the last day of the taxable year of the partnership or limited liability company, for which the credit is claimed. Any partner or member who claims the credit as provided under this paragraph shall attach a copy of the agreement, if applicable, to the tax return on which the credit is claimed. A person claiming the credit as provided under this paragraph is solely responsible for any tax liability arising from a dispute with the department of revenue related to claiming the credit.

SB461-SSA1,9,4 2. Any claimant who transfers an interest in a partnership, limited liability company, or tax-option corporation after the first credit allowance date, as defined under 26 USC 45D (b), but before the final credit allowance date for the credit allowed under this subsection shall be entitled to claim the credit for the remaining credit allowance dates by filing with the claimant's return a written agreement between the claimant and the transferee of the interest that specifies that the claimant, not the transferee, is the person entitled to claim the credit.

SB461-SSA1,9,7 3. The Wisconsin adjusted basis of any investment for which a credit is claimed under par. (b) shall be reduced by the amount of the credit that is offset against Wisconsin income taxes.

SB461-SSA1,9,9 4. A claimant may claim the credit under this subsection regardless of whether the claimant claims a credit under 26 USC 45D.

SB461-SSA1,9,11 (d) Administration. 1. 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.

SB461-SSA1,9,16 2. The department of revenue may promulgate rules regarding the recapture of tax credits claimed under this subsection, consistent with 26 USC 45D (g). If a claimant's federal tax credit under 26 USC 45D is subject to recapture under 26 USC 45D (g), the claimant's tax credit under this subsection is subject to recapture at the same time and in the same manner as the claimant's federal tax credit.

SB461-SSA1,9,19 3. No credit may be allowed under this subsection unless the claimant includes with the claimant's return a copy of the claimant's certification for tax benefits under s. 560.2065 (2) (b).

SB461-SSA1, s. 7 Section 7. 71.49 (1) (dn) of the statutes is created to read:

SB461-SSA1,9,21 71.49 (1) (dn) New markets credit under s. 71.47 (5n).

SB461-SSA1, s. 8 Section 8. 76.639 of the statutes is created to read:

SB461-SSA1,9,26 76.639 New markets credit. (1) Filing claims. Subject to the limitations provided under this section and s. 560.2065, for investments made after December 31, 2010, an insurer may claim as a credit against the fees imposed under s. 76.60, 76.63, 76.65, 76.66, or 76.67 the amount of the insurer's qualified equity investment, as certified under s. 560.2065 (2), multiplied by the following percentage:

SB461-SSA1,10,4 (a) For the taxable year that corresponds to the first credit allowance date, as defined under 26 USC 45D (a) (3), zero percent.

SB461-SSA1,10,7 (b) For the taxable years that correspond to the 6 credit allowance dates, as defined under 26 USC 45D (a) (3), following the credit allowance date described in subd. 1., 3 percent.

SB461-SSA1,10,9 (2) Limitations. (a) An insurer may claim the credit under this section regardless of whether the insurer claims a credit under 26 USC 45D.

SB461-SSA1,10,14 (b) The department of revenue may promulgate rules regarding the recapture of credits claimed under this section, consistent with 26 USC 45D (g). If a claimant's federal tax credit under 26 USC 45D is subject to recapture under 26 USC 45D (g), the claimant's tax credit under this section is subject to recapture at the same time and in the same manner as the claimant's federal tax credit.

SB461-SSA1,10,17 (c) No credit may be allowed under this section unless the claimant includes with the claimant's return a copy of the claimant's certification for tax benefits under s. 560.2065 (2) (b).

SB461-SSA1,10,23 (3) Carry-forward. If the credit under sub. (2) is not entirely offset against the fees under s. 76.60, 76.63, 76.65, 76.66, or 76.67 otherwise due, the unused balance may be carried forward and credited against those fees for the following 15 years to the extent that it is not offset by those fees otherwise due in all the years between the year in which the expense was made and the year in which the carry-forward credit is claimed.

SB461-SSA1, s. 9 Section 9. 560.2065 of the statutes is created to read:

SB461-SSA1,11,2 560.2065 Certification of qualified equity investments. (1) Definitions. In this section:

SB461-SSA1,11,4 (a) "Credit allowance date" means a credit allowance date as defined under 26 USC 45D (a) (3).

SB461-SSA1,11,6 (b) "Qualified active low-income community business" means a qualified active low-income community business as defined in 26 USC 45D (d) 2.

SB461-SSA1,11,8 (c) "Qualified community development entity" means a qualified community development entity as defined under 26 USC 45D (c).

SB461-SSA1,11,10 (d) "Qualified equity investment" means a qualified equity investment as defined under 26 USC 45D (b).

SB461-SSA1,11,11 (2) Certification. The department may do all of the following:

SB461-SSA1,11,13 (a) Certify a qualified equity investment under this paragraph if all of the following apply:

SB461-SSA1,11,15 1. The proposed qualified equity investment will be funded by a qualified community development entity whose service area includes the state.

SB461-SSA1,11,18 2. The qualified community development entity identified in subd. 1. applies to the department on a form provided by the department and includes with the application evidence satisfactory to the department that all of the following apply:

SB461-SSA1,11,21 a. Subject to the limit under sub. (4) (a), proceeds from the proposed qualified equity investment will be invested in or loaned to a qualified active low-income community business located in this state.

SB461-SSA1,11,24 b. The proposed qualified equity investment will promote the creation or retention of jobs in this state or will promote other economic development goals established by the department by rule.

SB461-SSA1,12,5 (b) Subject to the limit under sub. (4) (b), certify a person under this paragraph to claim tax credits under ss. 71.07 (5n), 71.28 (5n), 71.47 (5n), and 76.639 if the person applies to the department on a form provided by the department and submits evidence satisfactory to the department that the person made an investment in a qualified equity investment certified under par. (a).

SB461-SSA1,12,12 (3) Eligibility. (a) A qualified equity investment certified under sub. (2) (a) shall be funded by the qualified community development entity that submitted the application under sub. (2) (a) 2. by the last day of the 13th month beginning after the date of certification under sub. (2) (a). The certification of a qualified equity investment that is not funded by the last day of the 13th month beginning after the date of certification under sub. (2) (a) shall expire on the first day of the 14th month beginning after the date of certification.

SB461-SSA1,12,15 (b) A person certified under sub. (2) (b) is eligible to claim tax credits under ss. 71.07 (5n), 71.28 (5n), 71.47 (5n), and 76.639 in each taxable year in which a credit allowance date falls.

SB461-SSA1,12,19 (4) Limits. (a) A qualified active low-income community business receiving investments, loans, or proceeds from qualified community development entities certified under sub. (2) (a) may receive no more than $5,000,000 in investments, loans, or proceeds from such qualified community development entities.

SB461-SSA1,12,23 (b) The maximum amount of tax credits under ss. 71.07 (5n), 71.28 (5n), 71.47 (5n), and 76.639 that may be certified under sub. (2) (b), for making investments in qualified equity investments certified under sub. (2) (a), is $10,000,000 in each fiscal year, including the amount for all credit allowance dates.

SB461-SSA1,13,3 (5) Duties of the department. (a) The department of commerce shall notify the department of revenue of every certification issued under sub. (2) and shall include the date on which any such certification is granted.

SB461-SSA1,13,5 (b) The department shall provide to each applicant under sub. (2) a dated written notice indicating the department's decision to grant or deny certification.

SB461-SSA1,13,7 (c) The department shall promulgate rules to administer this program, including all of the following:

SB461-SSA1,13,9 1. Deadlines for the submission of an application for certification under this section.

SB461-SSA1,13,11 2. The period for review of applications submitted under this section, which period may not exceed 45 days.

SB461-SSA1,13,14 3. Criteria for reviewing applications under this section and for prioritizing applications for certification received under sub. (2) (a). The criteria under this subdivision shall do all of the following:

SB461-SSA1,13,16 a. Include economic development goals that are consistent with the provisions of 26 USC 45D.

SB461-SSA1,13,20 b. Prioritize applications received under sub. (2) (a) from qualified community development entities proposing qualified equity investments in qualified active low-income community businesses that are owner-occupied businesses not primarily engaged in any of the activities identified under s. 560.205 (1) (g).

SB461-SSA1, s. 10 Section 10. Nonstatutory provisions.

SB461-SSA1,13,25 (1) (a) The department of commerce shall submit in proposed form the rules required under section 560.2065 (5) (c) of the statutes, as created by this act, to the legislative council staff under section 227.15 (1) of the statutes no later than the first day of the 4th month beginning after the effective date of this paragraph.

SB461-SSA1,14,9 (b) Using the procedure under section 227.24 of the statutes, the department of commerce may promulgate rules required under section 560.2065 (5) (c) of the statutes, as created by this act, for the period before the effective date of the rules submitted under paragraph (a), but not to exceed the period authorized under section 227.24 (1) (c) and (2) of the statutes. Notwithstanding section 227.24 (1) (a), (2) (b), and (3) of the statutes, the department is not required to provide evidence that promulgating a rule under this paragraph as an emergency rule is necessary for the preservation of the public peace, health, safety, or welfare and is not required to provide a finding of emergency for a rule promulgated under this paragraph.

SB461-SSA1, s. 11 Section 11. Initial applicability.

SB461-SSA1,14,11 (1) This act first applies to taxable years beginning on January 1, 2011.

SB461-SSA1,14,12 (End)