LRB-0947/2
JK&FFK:cjs:rs
2011 - 2012 LEGISLATURE
August 2, 2011 - Introduced by Representatives Molepske Jr, Williams, Vruwink,
Brooks, T. Larson, Spanbauer, Doyle, Bernard Schaber, Berceau, Ringhand,
Fields, Bewley, Turner
and Pope-Roberts, cosponsored by Senators Lassa
and Taylor. Referred to Committee on Jobs, Economy and Small Business.
AB211,1,5 1An Act to amend 71.05 (6) (a) 15., 71.21 (4), 71.26 (2) (a) 4., 71.34 (1k) (g), 71.45
2(2) (a) 10., 76.67 (2) and 77.92 (4); and to create 71.07 (5p), 71.10 (4) (cs), 71.28
3(5p), 71.30 (3) (dp), 71.47 (5p), 71.49 (1) (dp), 76.634 and 238.17 of the statutes;
4relating to: an income and franchise tax credit for investments in a community
5development financial institution.
Analysis by the Legislative Reference Bureau
Under this bill, the Wisconsin Economic Development Corporation (WEDC)
may certify a person who makes a qualified investment in a registered community
development financial institution (CDFI) to receive a credit against state income and
franchise taxes, for taxable years beginning after December 31, 2011, and before
January 1, 2014, and against license fees paid by insurers. The bill defines a CDFI
as an entity that is organized under the laws of this state and has been certified by
the Community Development Financial Institutions Fund established under federal
law (fund) as meeting certain eligibility requirements. The bill permits WEDC to
register a CDFI that applies to WEDC and complies with annual reporting
requirements. The bill defines a "qualified investment" as a loan or deposit that pays
no interest of at least $10,000 that is made for a minimum of 60 months and over
which the CDFI retains complete control for the duration of the investment period.
WEDC may revoke the registration of a CDFI that fails to comply with annual
reporting requirements or that no longer meets the eligibility requirement for
certification by the fund. WEDC may certify up to $500,000 in tax credits in any
calendar year.

A person certified to receive tax credits may claim 10 percent of the person's
qualified investment, if the investment is at least $10,000, but not more than
$150,000, or 12 percent of the person's qualified investment, if the investment is
more than $150,000, but not more than $500,000. If the person withdraws the
qualified investment from the CDFI before the end of the investment period and does
not reinvest the qualified investment in another CDFI, the person must repay a
portion of the credit amounts that the person received by adding the portion to the
person's tax or fee liability in a subsequent year. However, the portion that the
person must repay depends on when the person withdraws the investment during
the investment period. The portion that the person must repay decreases the longer
the person holds the investment during the investment period.
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:
AB211, s. 1 1Section 1. 71.05 (6) (a) 15. of the statutes, as affected by 2011 Wisconsin Act
232
, is amended to read:
AB211,2,83 71.05 (6) (a) 15. The amount of the credits computed under s. 71.07 (2dd), (2de),
4(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r),
5(3rm), (3rn), (3s), (3t), (3w), (5e), (5f), (5h), (5i), (5j), (5k), (5n), (5p), (5r), (5rm), and
6(8r) and not passed through by a partnership, limited liability company, or
7tax-option corporation that has added that amount to the partnership's, company's,
8or tax-option corporation's income under s. 71.21 (4) or 71.34 (1k) (g).
AB211, s. 2 9Section 2. 71.07 (5p) of the statutes is created to read:
AB211,2,1210 71.07 (5p) Community development financial institution credit. (a)
11Definition. In this subsection, "claimant" means a person who files a claim under this
12subsection.
AB211,3,613 (b) Filing claims. Subject to the limitations provided under this subsection and
14the requirements under s. 238.17, for taxable years beginning after December 31,
152011, and before January 1, 2014, a claimant may claim as a credit against the tax

1imposed under s. 71.02, up to the amount of the tax, for the taxable year in which the
2investment is made, an amount equal to 10 percent of the claimant's qualified
3investment in a community development financial institution, if the investment is
4at least $10,000, but not more than $150,000, or 12 percent of the claimant's qualified
5investment in a community development financial institution, if the investment is
6more than $150,000, but not more than $500,000.
AB211,3,147 (c) Limitations. Partnerships, limited liability companies, and tax-option
8corporations may not claim the credit under this subsection, but the eligibility for,
9and the amount of, the credit are based on their payment of amounts under par. (b).
10A partnership, limited liability company, or tax-option corporation shall compute
11the amount of credit that each of its partners, members, or shareholders may claim
12and shall provide that information to each of them. Partners, members of limited
13liability companies, and shareholders of tax-option corporations may claim the
14credit in proportion to their ownership interests.
AB211,3,1615 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
16s. 71.28 (4), applies to the credit under this subsection.
AB211, s. 3 17Section 3. 71.10 (4) (cs) of the statutes is created to read:
AB211,3,1918 71.10 (4) (cs) Community development financial institution credit under s.
1971.07 (5p).
AB211, s. 4 20Section 4. 71.21 (4) of the statutes, as affected by 2011 Wisconsin Act 32, is
21amended to read:
AB211,3,2522 71.21 (4) Credits computed by a partnership under s. 71.07 (2dd), (2de), (2di),
23(2dj), (2dL), (2dm), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3s),
24(3t), (3w), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5n), (5p), (5r), (5rm), and (8r) and passed
25through to partners shall be added to the partnership's income.
AB211, s. 5
1Section 5. 71.26 (2) (a) 4. of the statutes, as affected by 2011 Wisconsin Act 32,
2is amended to read:
AB211,4,93 71.26 (2) (a) 4. Plus the amount of the credit computed under s. 71.28 (1dd),
4(1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (1dy), (3g), (3h), (3n), (3p), (3q), (3r),
5(3rm), (3rn), (3t), (3w), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5n), (5p), (5r), (5rm), (8r),
6and (9s) and not passed through by a partnership, limited liability company, or
7tax-option corporation that has added that amount to the partnership's, limited
8liability company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1k)
9(g).
AB211, s. 6 10Section 6. 71.28 (5p) of the statutes is created to read:
AB211,4,1311 71.28 (5p) Community development financial institution credit. (a)
12Definition. In this subsection, "claimant" means a person who files a claim under this
13subsection.
AB211,4,2214 (b) Filing claims. Subject to the limitations provided under this subsection and
15the requirements under s. 238.17, for taxable years beginning after December 31,
162011, and before January 1, 2014, a claimant may claim as a credit against the tax
17imposed under s. 71.23, up to the amount of the tax, for the taxable year in which the
18investment is made, an amount equal to 10 percent of the claimant's qualified
19investment in a community development financial institution, if the investment is
20at least $10,000, but not more than $150,000, or 12 percent of the claimant's qualified
21investment in a community development financial institution, if the investment is
22more than $150,000, but not more than $500,000.
AB211,5,523 (c) Limitations. Partnerships, limited liability companies, and tax-option
24corporations may not claim the credit under this subsection, but the eligibility for,
25and the amount of, the credit are based on their payment of amounts under par. (b).

1A partnership, limited liability company, or tax-option corporation shall compute
2the amount of credit that each of its partners, members, or shareholders may claim
3and shall provide that information to each of them. Partners, members of limited
4liability companies, and shareholders of tax-option corporations may claim the
5credit in proportion to their ownership interests.
AB211,5,76 (d) Administration. Subsection (4) (e) to (h), as it applies to the credit under
7sub. (4), applies to the credit under this subsection.
AB211, s. 7 8Section 7. 71.30 (3) (dp) of the statutes is created to read:
AB211,5,109 71.30 (3) (dp) Community development financial institution credit under s.
1071.28 (5p).
AB211, s. 8 11Section 8. 71.34 (1k) (g) of the statutes, as affected by 2011 Wisconsin Act 32,
12is amended to read:
AB211,5,1613 71.34 (1k) (g) An addition shall be made for credits computed by a tax-option
14corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (1dy),
15(3), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3t), (3w), (5e), (5f), (5g), (5h), (5i), (5j),
16(5k), (5n), (5p), (5r), (5rm), and (8r) and passed through to shareholders.
AB211, s. 9 17Section 9. 71.45 (2) (a) 10. of the statutes, as affected by 2011 Wisconsin Act
1832
, is amended to read:
AB211,5,2519 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
20computed under s. 71.47 (1dd) to (1dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn),
21(3w), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5n), (5p), (5r), (5rm), (8r), and (9s) and not
22passed through by a partnership, limited liability company, or tax-option
23corporation that has added that amount to the partnership's, limited liability
24company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1k) (g) and
25the amount of credit computed under s. 71.47 (1), (3), (3t), (4), (4m), and (5).
AB211, s. 10
1Section 10. 71.47 (5p) of the statutes is created to read:
AB211,6,42 71.47 (5p) Community development financial institution credit. (a)
3Definition. In this subsection, "claimant" means a person who files a claim under this
4subsection.
AB211,6,135 (b) Filing claims. Subject to the limitations provided under this subsection and
6the requirements under s. 238.17, for taxable years beginning after December 31,
72011, and before January 1, 2014, a claimant may claim as a credit against the tax
8imposed under s. 71.43, up to the amount of the tax, for the taxable year in which the
9investment is made, an amount equal to 10 percent of the claimant's qualified
10investment in a community development financial institution, if the investment is
11at least $10,000, but not more than $150,000, or 12 percent of the claimant's qualified
12investment in a community development financial institution, if the investment is
13more than $150,000, but not more than $500,000.
AB211,6,2114 (c) Limitations. Partnerships, limited liability companies, and tax-option
15corporations may not claim the credit under this subsection, but the eligibility for,
16and the amount of, the credit are based on their payment of amounts under par. (b).
17A partnership, limited liability company, or tax-option corporation shall compute
18the amount of credit that each of its partners, members, or shareholders may claim
19and shall provide that information to each of them. Partners, members of limited
20liability companies, and shareholders of tax-option corporations may claim the
21credit in proportion to their ownership interests.
AB211,6,2322 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
23s. 71.28 (4), applies to the credit under this subsection.
AB211, s. 11 24Section 11. 71.49 (1) (dp) of the statutes is created to read:
AB211,7,2
171.49 (1) (dp) Community development financial institution credit under s.
271.47 (5p).
AB211, s. 12 3Section 12. 76.634 of the statutes is created to read:
AB211,7,13 476.634 Community development financial institution credit. (1) Filing
5claims.
Subject to the limitations provided under this subsection and the
6requirements under s. 238.17, for taxable years beginning after December 31, 2011,
7and before January 1, 2014, an insurer may claim as a credit against the fees due
8under s. 76.60, 76.63, 76.65, 76.66, or 76.67 for the taxable year in which the
9investment is made, an amount equal to 10 percent of the insurer's qualified
10investment in a community development financial institution, if the investment is
11at least $10,000, but not more than $150,000, or 12 percent of the insurer's qualified
12investment in a community development financial institution, if the investment is
13more than $150,000, but not more than $500,000.
AB211,7,19 14(2) Carry-forward. If the credit under sub. (1) is not entirely offset against the
15fees under s. 76.60, 76.63, 76.65, 76.66, or 76.67 otherwise due, the unused balance
16may be carried forward and credited against those fees for the following 15 years to
17the extent that it is not offset by those fees otherwise due in all the years between
18the year in which the expense was made and the year in which the carry-forward
19credit is claimed.
AB211,7,22 20(3) Limitations. No credit may be allowed under this section unless the insurer
21includes with the insurer's annual return under s. 76.64 a copy of the insurer's
22certification for tax benefits under s. 238.17 (5) (b).
AB211, s. 13 23Section 13. 76.67 (2) of the statutes is amended to read:
AB211,8,824 76.67 (2) If any domestic insurer is licensed to transact insurance business in
25another state, this state may not require similar insurers domiciled in that other

1state to pay taxes greater in the aggregate than the aggregate amount of taxes that
2a domestic insurer is required to pay to that other state for the same year less the
3credits under ss. 76.634, 76.635, 76.636, 76.637, 76.638, and 76.655, except that the
4amount imposed shall not be less than the total of the amounts due under ss. 76.65
5(2) and 601.93 and, if the insurer is subject to s. 76.60, 0.375% of its gross premiums,
6as calculated under s. 76.62, less offsets allowed under s. 646.51 (7) or under ss.
776.634, 76.635, 76.636, 76.637, 76.638, and 76.655 against that total, and except that
8the amount imposed shall not be less than the amount due under s. 601.93.
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