SB44: Bill Text

LRB-1944/1

MES:jrd:jlb

1995 - 1996 LEGISLATURE

1995 Senate BILL 44

January 26, 1995 - Introduced by Senators Zien, Leean, Drzewiecki, Farrow, Schultz, Andrea, Weeden, Breske, Fitzgerald, Panzer, C. Potter and Petak, cosponsored by Representatives Albers, Jensen, Ward, Otte, Hasenohrl, Baldus, Silbaugh, Black, Lehman, Freese, Ziegelbauer, Goetsch, Krusick, Gard, Gronemus, Ladwig, Musser, Nass, Handrick, Hahn, Underheim, Brandemuehl, Owens, Wirch, Robson, Grothman, Plache, Foti, Ourada, Walker, Springer, Wood, Kreibich, Plombon, Lazich, Hutchison, Vander Loop, Vrakas, Dobyns, Zukowski, Ott, Klusman, Green, Duff, Ainsworth, Lorge and Seratti. Referred to Committee on State Government Operations and Corrections.

SB44,1,2 An Act to create 71.07 (7m) and 71.10 (4) (dp) of the statutes; relating to: a nonrefundable individual income tax credit for adoption expenses.

Analysis by the Legislative Reference Bureau

This bill creates an income tax credit for individuals for certain expenses incurred relating to the adoption of a child. The credit is equal to 10% of adoption expenses that exceed 20% of Wisconsin adjusted gross income. The maximum eligible amount of expenses is $20,000 and the maximum credit is $800.

The credit is nonrefundable. If the amount of the credit exceeds a taxpayer's tax liability, no refund will be issued.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

SB44, s. 1 Section 1. 71.07 (7m) of the statutes is created to read:

SB44,1,4 71.07 (7m) Adoption expenses credit. (a) Definitions. In this subsection:

SB44,1,7 1. "Adoption expenses" means any amount expended by a claimant for adoption fees, court costs or legal fees relating to the adoption of a child, whether or not the adoption process is completed.

SB44,1,8 2. "Claimant" means an adoptive parent or a prospective adoptive parent.

SB44,2,2 3. "Household" means a claimant and an individual related to the claimant as husband or wife.

SB44,2,6 (b) Filing claims. Subject to the limitations provided in this subsection, a claimant may claim as a credit against Wisconsin income taxes otherwise due, up to the amount of those taxes, an amount equal to 10% of the adoption expenses incurred by the claimant that exceed 20% of his or her Wisconsin adjusted gross income.

SB44,2,8 (c) Limitations. 1. The maximum credit that may be claimed under this subsection by a claimant is $800 for each adoption process.

SB44,2,10 2. No credit may be allowed under this subsection unless it is claimed within the time period under s. 71.75 (2).

SB44,2,12 3. The maximum amount of adoption expenses for each adoption process for which a credit is claimed under this subsection is $20,000.

SB44,2,14 4. Part-year residents and nonresidents of this state are not eligible for the credit under this subsection.

SB44,2,16 5. Except as provided in subd. 6., only one credit per household is allowed each year.

SB44,2,20 6. If a married couple files separately, each spouse may claim a maximum credit of 50% of the amount allowed under subd. 1., except that this limitation does not apply to married persons living apart who are treated as single under section 7703 (b) of the internal revenue code.

SB44,2,25 (d) Administration. The department of revenue may enforce the credit under this subsection and may take any action, conduct any proceeding and proceed as it is authorized in respect to taxes under this chapter. The income tax provisions in this chapter relating to assessments, refunds, appeals, collection, interest and penalties apply to the credit under this subsection.

SB44, s. 2 Section 2. 71.10 (4) (dp) of the statutes is created to read:

SB44,3,2 71.10 (4) (dp) Adoption expenses credit under s. 71.07 (7m).

SB44, s. 3 Section 3. Initial applicability.

SB44,3,5 (1)  This act first applies to taxable years beginning on January 1 of the year in which this act takes effect.

SB44,3,6 (End)