LRB-1923/1
JK:jld:pg
2007 - 2008 LEGISLATURE
March 13, 2007 - Introduced by Senators Leibham, Lazich, Plale, Grothman and
Kanavas, cosponsored by Representatives Van Roy, Gronemus, Nygren,
Shilling, Albers, Ballweg, Gunderson, Hahn, Jeskewitz, Owens, A. Ott,
Seidel, Townsend, Vos
and Wood. Referred to Committee on Small Business,
Emergency Preparedness, Workforce Development, Technical Colleges and
Consumer Protection.
SB94,1,5 1An Act to amend 71.05 (6) (a) 15., 71.21 (4), 71.26 (2) (a), 71.34 (1) (g), 71.45 (2)
2(a) 10. and 77.92 (4); and to create 71.07 (5i), 71.10 (4) (gxx), 71.28 (5i), 71.30
3(3) (epa), 71.47 (5i) and 71.49 (1) (gxx) of the statutes; relating to: an income
4and franchise credit for property taxes paid on restaurant kitchen machinery
5and equipment.
Analysis by the Legislative Reference Bureau
This bill creates an income and franchise tax credit in an amount that is equal
to the amount of property taxes that a taxpayer paid in the taxable year on
machinery and equipment, including refrigerators and other storage equipment,
used primarily in the operation of a restaurant's kitchen to prepare or serve food or
beverages. Under the bill, a restaurant includes pizza delivery establishments,
snack bars, beverage bars, takeout food shops, and mobile food services, including
mobile snack stands, mobile canteens, and ice cream vendors.
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:
SB94, s. 1 6Section 1. 71.05 (6) (a) 15. of the statutes is amended to read:
SB94,2,5
171.05 (6) (a) 15. The amount of the credits computed under s. 71.07 (2dd), (2de),
2(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g), (3n), (3s), (3t), (3w), (5b), (5d), and
3(5e), (5f), and (5h), and (5i) and not passed through by a partnership, limited liability
4company, or tax-option corporation that has added that amount to the partnership's,
5company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g).
SB94, s. 2 6Section 2. 71.07 (5i) of the statutes is created to read:
SB94,2,87 71.07 (5i) Restaurant kitchen equipment credit. (a) Definitions. In this
8subsection:
SB94,2,99 1. "Claimant" means a person who files a claim under this subsection.
SB94,2,1010 2. "Machinery" has the meaning given in s. 70.11 (27) (a) 2.
SB94,2,1311 3. "Restaurant" includes pizza delivery establishments, snack bars, beverage
12bars, takeout food shops, and mobile food services, including mobile snack stands,
13mobile canteens, and ice cream vendors.
SB94,2,1914 (b) Filing claims. Subject to the limitations provided in this subsection, a
15claimant may claim as a credit against the taxes imposed under s. 71.02, up to the
16amount of those taxes, an amount that is equal to the taxes imposed under ch. 70 that
17the claimant paid in the taxable year on machinery and equipment, including
18refrigerators and other storage equipment, used primarily in the operation of a
19restaurant's kitchen to prepare or serve food or beverages.
SB94,3,220 (c) Limitations. Partnerships, limited liability companies, and tax-option
21corporations may not claim the credit under this subsection, but the eligibility for,
22and the amount of, the credit are based on their payment of amounts under par. (b).
23A partnership, limited liability company, or tax-option corporation shall compute
24the amount of credit that each of its partners, members, or shareholders may claim
25and shall provide that information to each of them. Partners, members of limited

1liability companies, and shareholders of tax-option corporations may claim the
2credit in proportion to their ownership interests.
SB94,3,43 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
4s. 71.28 (4), applies to the credit under this subsection.
SB94, s. 3 5Section 3. 71.10 (4) (gxx) of the statutes is created to read:
SB94,3,66 71.10 (4) (gxx) Restaurant kitchen equipment credit under s. 71.07 (5i).
SB94, s. 4 7Section 4. 71.21 (4) of the statutes is amended to read:
SB94,3,108 71.21 (4) Credits computed by a partnership under s. 71.07 (2dd), (2de), (2di),
9(2dj), (2dL), (2dm), (2ds), (2dx), (3g), (3n), (3s), (3t), (3w), (5b), (5e), (5f), (5g), and (5h),
10and (5i)
and passed through to partners shall be added to the partnership's income.
SB94, s. 5 11Section 5. 71.26 (2) (a) of the statutes is amended to read:
SB94,4,412 71.26 (2) (a) Corporations in general. The "net income" of a corporation means
13the gross income as computed under the Internal Revenue Code as modified under
14sub. (3) minus the amount of recapture under s. 71.28 (1di) plus the amount of credit
15computed under s. 71.28 (1), (3), (4), and (5) minus, as provided under s. 71.28 (3) (c)
167., the amount of the credit under s. 71.28 (3) that the taxpayer added to income
17under this paragraph at the time that the taxpayer first claimed the credit plus the
18amount of the credit computed under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm),
19(1ds), (1dx), (3g), (3n), (3t), (3w), (5b), (5e), (5f), (5g), and (5h), and (5i) and not passed
20through by a partnership, limited liability company, or tax-option corporation that
21has added that amount to the partnership's, limited liability company's, or
22tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) plus the amount
23of losses from the sale or other disposition of assets the gain from which would be
24wholly exempt income, as defined in sub. (3) (L), if the assets were sold or otherwise
25disposed of at a gain and minus deductions, as computed under the Internal Revenue

1Code as modified under sub. (3), plus or minus, as appropriate, an amount equal to
2the difference between the federal basis and Wisconsin basis of any asset sold,
3exchanged, abandoned, or otherwise disposed of in a taxable transaction during the
4taxable year, except as provided in par. (b) and s. 71.45 (2) and (5).
SB94, s. 6 5Section 6. 71.28 (5i) of the statutes is created to read:
SB94,4,76 71.28 (5i) Restaurant kitchen equipment credit. (a) Definitions. In this
7subsection:
SB94,4,88 1. "Claimant" means a person who files a claim under this subsection.
SB94,4,99 2. "Machinery" has the meaning given in s. 70.11 (27) (a) 2.
SB94,4,1210 3. "Restaurant" includes pizza delivery establishments, snack bars, beverage
11bars, takeout food shops, and mobile food services, including mobile snack stands,
12mobile canteens, and ice cream vendors.
SB94,4,1813 (b) Filing claims. Subject to the limitations provided in this subsection, a
14claimant may claim as a credit against the taxes imposed under s. 71.23, up to the
15amount of those taxes, an amount that is equal to the taxes imposed under ch. 70 that
16the claimant paid in the taxable year on machinery and equipment, including
17refrigerators and other storage equipment, used primarily in the operation of a
18restaurant's kitchen to prepare or serve food or beverages.
SB94,5,219 (c) Limitations. Partnerships, limited liability companies, and tax-option
20corporations may not claim the credit under this subsection, but the eligibility for,
21and the amount of, the credit are based on their payment of amounts under par. (b).
22A partnership, limited liability company, or tax-option corporation shall compute
23the amount of credit that each of its partners, members, or shareholders may claim
24and shall provide that information to each of them. Partners, members of limited

1liability companies, and shareholders of tax-option corporations may claim the
2credit in proportion to their ownership interests.
SB94,5,43 (d) Administration. Subsection (4) (e) to (h), as it applies to the credit under
4sub. (4), applies to the credit under this subsection.
SB94, s. 7 5Section 7. 71.30 (3) (epa) of the statutes is created to read:
SB94,5,66 71.30 (3) (epa) Restaurant kitchen equipment credit under s. 71.28 (5i).
SB94, s. 8 7Section 8. 71.34 (1) (g) of the statutes is amended to read:
SB94,5,118 71.34 (1) (g) An addition shall be made for credits computed by a tax-option
9corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (3), (3g),
10(3n), (3t), (3w), (5b), (5e), (5f), (5g), and (5h) , and (5i) and passed through to
11shareholders.
SB94, s. 9 12Section 9. 71.45 (2) (a) 10. of the statutes is amended to read:
SB94,5,1813 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
14computed under s. 71.47 (1dd) to (1dx), (3n), (3w), (5b), (5e), (5f), (5g), and (5h), and
15(5i)
and not passed through by a partnership, limited liability company, or tax-option
16corporation that has added that amount to the partnership's, limited liability
17company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) and
18the amount of credit computed under s. 71.47 (1), (3), (3t), (4), and (5).
SB94, s. 10 19Section 10. 71.47 (5i) of the statutes is created to read:
SB94,5,2120 71.47 (5i) Restaurant kitchen equipment credit. (a) Definitions. In this
21subsection:
SB94,5,2222 1. "Claimant" means a person who files a claim under this subsection.
SB94,5,2323 2. "Machinery" has the meaning given in s. 70.11 (27) (a) 2.
SB94,6,3
13. "Restaurant" includes pizza delivery establishments, snack bars, beverage
2bars, takeout food shops, and mobile food services, including mobile snack stands,
3mobile canteens, and ice cream vendors.
SB94,6,94 (b) Filing claims. Subject to the limitations provided in this subsection, a
5claimant may claim as a credit against the taxes imposed under s. 71.43, up to the
6amount of those taxes, an amount that is equal to the taxes imposed under ch. 70 that
7the claimant paid in the taxable year on machinery and equipment, including
8refrigerators and other storage equipment, used primarily in the operation of a
9restaurant's kitchen to prepare or serve food or beverages.
SB94,6,1710 (c) Limitations. Partnerships, limited liability companies, and tax-option
11corporations may not claim the credit under this subsection, but the eligibility for,
12and the amount of, the credit are based on their payment of amounts under par. (b).
13A partnership, limited liability company, or tax-option corporation shall compute
14the amount of credit that each of its partners, members, or shareholders may claim
15and shall provide that information to each of them. Partners, members of limited
16liability companies, and shareholders of tax-option corporations may claim the
17credit in proportion to their ownership interests.
SB94,6,1918 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
19s. 71.28 (4), applies to the credit under this subsection.
SB94, s. 11 20Section 11. 71.49 (1) (gxx) of the statutes is created to read:
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