SB167: Bill Text

SB167,8,5 71.06 (1) (title) Fiduciaries, single individuals and heads of households; 1986 to 1996. (intro.) The tax to be assessed, levied and collected upon the taxable incomes of all fiduciaries, except fiduciaries of nuclear decommissioning trust or reserve funds, and single individuals for taxable years beginning on or after August 1, 1986, and before January 1, 1994, and upon the taxable incomes of all fiduciaries, except fiduciaries of nuclear decommissioning trust or reserve funds, and single individuals and heads of households for taxable years beginning on or after January 1, 1994 after December 31, 1993, and before January 1, 1997, shall be computed at the following rates:

SB167, s. 10 Section 10. 71.06 (1m) of the statutes is created to read:

SB167,8,11 71.06 (1m) Fiduciaries, single individuals and heads of households. The tax to be assessed, levied and collected upon the taxable incomes of all fiduciaries, except fiduciaries of nuclear decommissioning trust or reserve funds, and single individuals and heads of households for taxable years beginning after December 31, 1996, shall be computed at the following rates:

SB167,8,12 (a) On all taxable income from $0 to $7,500, 4%.

SB167,8,13 (b) On all taxable income exceeding $7,500 but not exceeding $15,000, 5%.

SB167,8,14 (c) On all taxable income exceeding $15,000 but not exceeding $45,000, 6%.

SB167,8,15 (d) On all taxable income exceeding $45,000 but not exceeding $60,000, 7%.

SB167,8,16 (e) On all taxable income exceeding $60,000, 8%.

SB167, s. 11 Section 11. 71.06 (2) (intro.) of the statutes is amended to read:

SB167,8,21 71.06 (2) Married persons. (intro.) The tax to be assessed, levied and collected upon the taxable incomes of all married persons for calendar year 1987 and corresponding fiscal years and for calendar and fiscal years thereafter shall be computed at the following rates:

SB167, s. 12 Section 12. 71.06 (2) (a) (intro.) of the statutes is amended to read:

SB167,8,24 71.06 (2) (a) (intro.) For joint returns, for taxable years beginning after July 31, 1986, and before January 1, 1997:

SB167, s. 13 Section 13. 71.06 (2) (b) (intro.) of the statutes is amended to read:

SB167,9,2 71.06 (2) (b) (intro.) For married persons filing separately, for taxable years beginning after July 31, 1986, and before January 1, 1997:

SB167, s. 14 Section 14. 71.06 (2) (c) of the statutes is created to read:

SB167,9,5 71.06 (2) (c) For joint returns, for taxable years beginning after December 31, 1996:

SB167,9,6 1. On all taxable income from $0 to $10,000, 4%.

SB167,9,7 2. On all taxable income exceeding $10,000 but not exceeding $20,000, 5%.

SB167,9,8 3. On all taxable income exceeding $20,000 but not exceeding $60,000, 6%.

SB167,9,9 4. On all taxable income exceeding $60,000 but not exceeding $80,000, 7%.

SB167,9,10 5. On all taxable income exceeding $80,000, 8%.

SB167, s. 15 Section 15. 71.06 (2) (d) of the statutes is created to read:

SB167,9,13 71.06 (2) (d) For married persons filing separately, for taxable years beginning after December 31, 1996:

SB167,9,14 1. On all taxable income from $0 to $5,000, 4%.

SB167,9,15 2. On all taxable income exceeding $5,000 but not exceeding $10,000, 5%.

SB167,9,16 3. On all taxable income exceeding $10,000 but not exceeding $30,000, 6%.

SB167,9,17 4. On all taxable income exceeding $30,000 but not exceeding $40,000, 7%.

SB167,9,18 5. On all taxable income exceeding $40,000, 8%.

SB167, s. 16 Section 16. 71.06 (2m) of the statutes is amended to read:

SB167,9,23 71.06 (2m) Rate changes. If a rate under sub. (1) (1m) or (2) changes during a taxable year, the taxpayer shall compute the tax for that taxable year by the methods applicable to the federal income tax under section 15 of the internal revenue code.

SB167, s. 17 Section 17. 71.07 (1) of the statutes is amended to read:

SB167,10,10 71.07 (1) Claim of right credit. Any natural person may credit against taxes otherwise due under this chapter the decrease in tax under this chapter for the prior taxable year that would be attributable to subtracting income taxed for that year under the claim of right doctrine but repaid, as calculated under section 1341 of the internal revenue code, if the income repaid is greater than $3,000 and the amount is not subtracted in computing Wisconsin adjusted gross income or used in computing the credit under sub. (5) (a). If the allowable amount of the claim exceeds the claimant's taxes due under this chapter the amount of the claim not used to offset those taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft drawn on the general fund.

SB167, s. 18 Section 18. 71.07 (5) (a) (intro.) of the statutes is amended to read:

SB167,10,14 71.07 (5) (a) (intro.) Add For taxable years beginning before January 1, 1997, add the amounts allowed as itemized deductions under the internal revenue code except:

SB167, s. 19 Section 19. 71.07 (5) (am) of the statutes is created to read:

SB167,10,18 71.07 (5) (am) For taxable years beginning after December 31, 1996, add the following amounts that are allowed as itemized deductions under the internal revenue code:

SB167,10,19 1. Interest that is incurred to purchase or refinance a principal residence.

SB167,10,21 2. Interest that is incurred to purchase or refinance a residence that is not a principal residence that is located in Wisconsin.

SB167,10,22 3. Charitable contributions.

SB167, s. 20 Section 20. 71.07 (5) (b) of the statutes is amended to read:

SB167,10,25 71.07 (5) (b) Subtract the standard deduction under s. 71.05 (22) from the amount under par. (a) or the amount under par. (am).

SB167, s. 21 Section 21. 71.07 (6) (c) of the statutes is created to read:

SB167,11,3 71.07 (6) (c) No new claim may be filed under this subsection for a taxable year that begins after December 31, 1996.

SB167, s. 22 Section 22. 71.07 (8) (intro.) of the statutes is amended to read:

SB167,11,9 71.07 (8) Personal exemptions credit for natural persons. (intro.) On income of calendar year 1986 and corresponding fiscal years and thereafter, there may be deducted from the tax after it has been computed according to the rates of this section personal exemptions for natural persons as follows, except that no new claim may be filed under this subsection for a taxable year that begins after December 31, 1996:

SB167, s. 23 Section 23. 71.07 (9) (g) of the statutes is created to read:

SB167,11,12 71.07 (9) (g) No new claim may be filed under this subsection for a taxable year that begins after December 31, 1996.

SB167, s. 24 Section 24. 71.10 (7m) of the statutes is amended to read:

SB167,11,21 71.10 (7m) Discharge of indebtedness; modifications. If a person excludes from gross income an amount of income from a discharge of indebtedness because of discharges of debts described under section 108 (a) of the internal revenue code, the person shall make the adjustments specified in section 108 (b) of the internal revenue code, but the net operating loss under s. 71.01 (14), not the federal net operating loss, and Wisconsin credits, not federal credits, and the capital loss carry-forward as limited under s. 71.05 (10) (c), not the federal capital loss carry-forward, shall be applied, and the reduction rate for a credit carry-over is 6.93%, not 33 1/3%.

SB167, s. 25 Section 25. 71.125 of the statutes is amended to read:

SB167,12,2 71.125 Imposition of tax. The tax imposed by this chapter on individuals and the rates under s. 71.06 (1), (1m) and (2) shall apply to the Wisconsin taxable income of estates or trusts, except nuclear decommissioning trust or reserve funds, and that tax shall be paid by the fiduciary.

SB167, s. 26 Section 26. 71.36 (1m) of the statutes is amended to read:

SB167,12,24 71.36 (1m) A tax-option corporation may deduct from its net income all amounts included in the Wisconsin adjusted gross income of its shareholders, the capital gain deduction under s. 71.05 (6) (b) 9. and all amounts not taxable to nonresident shareholders under ss. 71.04 (1) and (4) to (9) and 71.362. For purposes of this subsection, interest on federal obligations, obligations issued under s. 66.066 by a local professional baseball park district, obligations issued under ss. 66.40, 66.431 and 66.4325, obligations issued under s. 234.65 to fund an economic development loan to finance construction, renovation or development of property that would be exempt under s. 70.11 (36) and obligations issued under subch. II of ch. 229 is not included in shareholders' income. The proportionate share of the net loss of a tax-option corporation shall be attributed and made available to shareholders on a Wisconsin basis but subject to the limitation and carry-over rules as prescribed by section 1366 (d) of the internal revenue code. Net operating losses of the corporation to the extent attributed or made available to a shareholder may not be used by the corporation for further tax benefit. For purposes of computing the Wisconsin adjusted gross income of shareholders, tax-option items shall be reported by the shareholders and those tax-option items, including capital gains and losses, shall retain the character they would have if attributed to the corporation, including their character as business income. In computing the tax liability of a shareholder, no credit against gross tax that would be available to the tax-option corporation if it were a nontax-option corporation may be claimed.

SB167, s. 27 Section 27. 71.64 (9) (b) of the statutes is amended to read:

SB167,13,13 71.64 (9) (b) The department shall from time to time adjust the withholding tables to reflect any changes in income tax rates, any applicable surtax or any changes in dollar amounts in s. 71.06 (1) (1m) and (2) resulting from statutory changes. The tables shall be extended to cover from zero to 10 withholding exemptions, shall assume that the payment of wages in each pay period will, when multiplied by the number of pay periods in a year, reasonably reflect the annual wage of the employe from the employer and shall be based on the further assumption that the annual wage will be reduced for allowable deductions from gross income. The department may determine the length of the tables and a reasonable span for each bracket. In preparing the tables the department shall adjust all withholding amounts not an exact multiple of 10 cents to the next highest figure that is a multiple of 10 cents. The department shall also provide instructions with the tables for withholding with respect to quarterly, semiannual and annual pay periods.

SB167, s. 28 Section 28. 71.67 (4) (a) of the statutes is amended to read:

SB167,13,19 71.67 (4) (a) The administrator of the lottery division in the department under ch. 565 shall withhold from any lottery prize of $2,000 or more an amount determined by multiplying the amount of the prize by the highest rate applicable to individuals under s. 71.06 (1) (1m). The administrator shall deposit the amounts withheld, on a monthly basis, as would an employer depositing under s. 71.65 (3) (a).

SB167, s. 29 Section 29. 71.67 (5) (a) of the statutes is amended to read:

SB167,14,2 71.67 (5) (a) Wager winnings. A person holding a license to sponsor and manage races under s. 562.05 (1) (b) 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) if the amount of the payment is more than $1,000.

SB167, s. 30 Section 30. Initial applicability.

SB167,14,4 (1) This act first applies to taxable years beginning on January 1, 1997.

SB167,14,5 (End)