AB732: Bill Text

AB732,10,21 71.28 (5) (ad) 2. For taxable years beginning after June 30, 2007, and before January 1, 2012, any corporation may credit against taxes otherwise due under this chapter an amount equal to 10 percent of the amount paid or incurred by that corporation during the taxable year to construct and equip new facilities or expand existing facilities used in this state for qualified research, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses paid or incurred by the claimant for research related to designing internal combustion engines for vehicles, including expenses related to designing vehicles that are powered by such engines and improving production processes for such engines and vehicles. Eligible amounts include only amounts paid or incurred for tangible, depreciable property but do not include amounts paid or incurred for replacement property.

AB732, s. 19 Section 19. 71.28 (5) (ad) 2m. of the statutes is created to read:

AB732,11,9 71.28 (5) (ad) 2m. For taxable years beginning after December 31, 2011, any corporation may claim as a credit against taxes otherwise due under s. 71.23 an amount equal to 15 percent of the amount paid or incurred by that corporation during the taxable year to construct and equip new facilities or expand existing facilities used in this state for qualified research, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses paid or incurred by the claimant for research directly or indirectly related to designing internal combustion engines for vehicles, including expenses related to designing vehicles that are powered by such engines and improving production processes for such engines and vehicles. Eligible amounts include only amounts paid or incurred for tangible, depreciable property but do not include amounts paid or incurred for replacement property.

AB732, s. 20 Section 20. 71.28 (5) (c) of the statutes is created to read:

AB732,11,16 71.28 (5) (c) Limitations. 1. The credits under par. (ad) 1., 2., and 3. may not be claimed by a partnership, except a publicly traded partnership treated as a corporation under s. 71.22 (1k), limited liability company, except a limited liability company treated as a corporation under s. 71.22 (1k), or tax-option corporation or by partners, including partners of a publicly traded partnership, members of a limited liability company, or shareholders of a tax-option corporation.

AB732,11,25 2. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under par. (ad) 2m., but the eligibility for, and the amount of, the credit are based on their payment of amounts under par. (ad) 2m. A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their allocation of the deductions of the qualified research expenses used to determine the credit.

AB732, s. 21 Section 21. 71.34 (1k) (g) of the statutes, as affected by 2011 Wisconsin Act 32, is amended to read:

AB732,12,7 71.34 (1k) (g) An addition shall be made for credits computed by a tax-option corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (1dy), (3), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3t), (3w), (4) (ad) 2m., (5) (ad) 2m., (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5n), (5r), (5rm), and (8r) and passed through to shareholders.

AB732, s. 22 Section 22. 71.365 (3) of the statutes is repealed.

AB732, s. 23 Section 23. 71.45 (2) (a) 10. of the statutes, as affected by 2011 Wisconsin Act 32, is amended to read:

AB732,12,18 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit computed under s. 71.47 (1dd) to (1dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3w), (4) (ad) 2m., (5) (ad) 2m., (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5n), (5r), (5rm), (8r), and (9s) and not passed through by a partnership, limited liability company, or tax-option corporation that has added that amount to the partnership's, limited liability company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1k) (g) and the amount of credit computed under s. 71.47 (1), (3), (3t), (4) (ad) 2m., (4m), and (5) (ad) 2m.

AB732, s. 24 Section 24. 71.47 (4) (ab) 2. of the statutes is repealed.

AB732, s. 25 Section 25. 71.47 (4) (ab) 3. of the statutes is amended to read:

AB732,13,2 71.47 (4) (ab) 3. "Vehicle" means any vehicle or frame, including parts, accessories, and component technologies, in which or on which an engine is mounted for use in mobile or stationary applications. "Vehicle" includes any truck, tractor, motorcycle, snowmobile, all-terrain vehicle, boat, personal watercraft, generator, construction equipment, mechanical drive for a stationary engine, lawn and garden maintenance equipment, automobile, van, sports utility vehicle, motor home, bus, or aircraft.

AB732, s. 26 Section 26. 71.47 (4) (ad) 1. of the statutes is amended to read:

AB732,13,18 71.47 (4) (ad) 1. Except as provided in subds. 2., 2m., and 3., any corporation may credit against taxes otherwise due under this chapter an amount equal to 5 percent of the amount obtained by subtracting from the corporation's qualified research expenses, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses incurred by the claimant, incurred for research conducted in this state for the taxable year, except that a taxpayer may elect the alternative computation under section 41 (c) (4) of the Internal Revenue Code and that election applies until the department permits its revocation, except as provided in par. (af), and except that "qualified research expenses" does not include compensation used in computing the credit under subs. (1dj) and (1dx), the corporation's base amount, as defined in section 41 (c) of the Internal Revenue Code, except that gross receipts used in calculating the base amount means gross receipts from sales attributable to Wisconsin under s. 71.25 (9) (b) 1. and 2., (df) 1. and 2., (dh) 1., 2., and 3., (dj), and (dk). Section 41 (h) of the Internal Revenue Code does not apply to the credit under this paragraph.

AB732, s. 27 Section 27. 71.47 (4) (ad) 2. of the statutes is amended to read:

AB732,14,12 71.47 (4) (ad) 2. For taxable years beginning after June 30, 2007, and before January 1, 2012, any corporation may credit against taxes otherwise due under this chapter an amount equal to 10 percent of the amount obtained by subtracting from the corporation's qualified research expenses, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses incurred by the claimant for research related to designing internal combustion engines for vehicles, including expenses related to designing vehicles that are powered by such engines and improving production processes for such engines and vehicles, incurred for research conducted in this state for the taxable year, except that a taxpayer may elect the alternative computation under section 41 (c) (4) of the Internal Revenue Code and that election applies until the department permits its revocation, except as provided in par. (af), and except that "qualified research expenses" does not include compensation used in computing the credit under subs. (1dj) and (1dx), the corporation's base amount, as defined in section 41 (c) of the Internal Revenue Code, except that gross receipts used in calculating the base amount means gross receipts from sales attributable to Wisconsin under s. 71.25 (9) (b) 1. and 2., (df) 1. and 2., (dh) 1., 2., and 3., (dj), and (dk). Section 41 (h) of the Internal Revenue Code does not apply to the credit under this paragraph.

AB732, s. 28 Section 28. 71.47 (4) (ad) 2m. of the statutes is created to read:

AB732,15,3 71.47 (4) (ad) 2m. For taxable years beginning after December 31, 2011, any corporation may claim as a credit against taxes otherwise due under s. 71.43 an amount equal to 15 percent of the corporation's qualified research expenses, as defined in section 41 of the Internal Revenue Code, that the corporation paid during the taxable year, except that "qualified research expenses" includes only expenses paid by the claimant for research directly or indirectly related to designing internal combustion engines for vehicles, including expenses related to designing vehicles that are powered by such engines and improving production processes for such engines and vehicles, incurred for research conducted in this state for the taxable year, except that a taxpayer may elect the alternative computation under section 41 (c) (4) of the Internal Revenue Code and that election applies until the department permits its revocation, except as provided in par. (af), and except that "qualified research expenses" does not include compensation used in computing the credit under subs. (1dj) and (1dx). Section 41 (h) of the Internal Revenue Code does not apply to the credit under this paragraph.

AB732, s. 29 Section 29. 71.47 (4) (af) of the statutes is amended to read:

AB732,15,9 71.47 (4) (af) Computation. If in any taxable year a corporation claims a credit under par. (ad) 1., 2., 2m., or 3., or any combination of those credits, the corporation may use a different computation method to calculate each of the credits and may choose to change the computation method once for each credit without the department's approval.

AB732, s. 30 Section 30. 71.47 (4) (i) of the statutes is renumbered 71.47 (4) (i) 1. and amended to read:

AB732,15,18 71.47 (4) (i) Nonclaimants Limitations. 1. The credits under this subsection par. (ad) 1., 2., and 3. may not be claimed by a partnership, except a publicly traded partnership treated as a corporation under s. 71.22 (1k), limited liability company, except a limited liability company treated as a corporation under s. 71.22 (1k), or tax-option corporation or by partners, including partners of a publicly traded partnership, members of a limited liability company or shareholders of a tax-option corporation.

AB732, s. 31 Section 31. 71.47 (4) (i) 2. of the statutes is created to read:

AB732,16,3 71.47 (4) (i) 2. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under par. (ad) 2m., but the eligibility for, and the amount of, the credit are based on their payment of amounts under par. (ad) 2m. A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their allocation of the deductions of the qualified research expenses used to determine the credit.

AB732, s. 32 Section 32. 71.47 (4m) (c) of the statutes is amended to read:

AB732,16,6 71.47 (4m) (c) Limitations. Section 71.28 (4) (b) to (d) and (i) 1., as it applies to the credit under s. 71.28 (4), applies to the credit under this subsection.

AB732, s. 33 Section 33. 71.47 (5) (ab) 2. of the statutes is repealed.

AB732, s. 34 Section 34. 71.47 (5) (ab) 3. of the statutes is amended to read:

AB732,16,15 71.47 (5) (ab) 3. "Vehicle" means any vehicle or frame, including parts, accessories, and component technologies, in which or on which an engine is mounted for use in mobile or stationary applications. "Vehicle" includes any truck, tractor, motorcycle, snowmobile, all-terrain vehicle, boat, personal watercraft, generator, construction equipment, mechanical drive for a stationary engine, lawn and garden maintenance equipment, automobile, van, sports utility vehicle, motor home, bus, or aircraft.

AB732, s. 35 Section 35. 71.47 (5) (ad) 1. of the statutes is amended to read:

AB732,16,24 71.47 (5) (ad) 1. Except as provided in subds. 2., 2m., and 3., for taxable year 1986 and subsequent years, any corporation may credit against taxes otherwise due under this chapter an amount equal to 5 percent of the amount paid or incurred by that corporation during the taxable year to construct and equip new facilities or expand existing facilities used in this state for qualified research, as defined in section 41 of the Internal Revenue Code. Eligible amounts include only amounts paid or incurred for tangible, depreciable property but do not include amounts paid or incurred for replacement property.

AB732, s. 36 Section 36. 71.47 (5) (ad) 2. of the statutes is amended to read:

AB732,17,12 71.47 (5) (ad) 2. For taxable years beginning after June 30, 2007, and before January 1, 2012, any corporation may credit against taxes otherwise due under this chapter an amount equal to 10 percent of the amount paid or incurred by that corporation during the taxable year to construct and equip new facilities or expand existing facilities used in this state for qualified research, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses paid or incurred by the claimant for research related to designing internal combustion engines for vehicles, including expenses related to designing vehicles that are powered by such engines and improving production processes for such engines and vehicles. Eligible amounts include only amounts paid or incurred for tangible, depreciable property but do not include amounts paid or incurred for replacement property.

AB732, s. 37 Section 37. 71.47 (5) (ad) 2m. of the statutes is created to read:

AB732,17,25 71.47 (5) (ad) 2m. For taxable years beginning after December 31, 2011, any corporation may claim as a credit against taxes otherwise due under s. 71.43 an amount equal to 15 percent of the amount paid or incurred by that corporation during the taxable year to construct and equip new facilities or expand existing facilities used in this state for qualified research, as defined in section 41 of the Internal Revenue Code, except that "qualified research expenses" includes only expenses paid or incurred by the claimant for research directly or indirectly related to designing internal combustion engines for vehicles, including expenses related to designing vehicles that are powered by such engines and improving production processes for such engines and vehicles. Eligible amounts include only amounts paid or incurred for tangible, depreciable property but do not include amounts paid or incurred for replacement property.

AB732, s. 38 Section 38. 71.47 (5) (c) of the statutes is created to read:

AB732,18,7 71.47 (5) (c) Limitations. 1. The credits under par. (ad) 1., 2., and 3. may not be claimed by a partnership, except a publicly traded partnership treated as a corporation under s. 71.22 (1k), limited liability company, except a limited liability company treated as a corporation under s. 71.22 (1k), or tax-option corporation or by partners, including partners of a publicly traded partnership, members of a limited liability company, or shareholders of a tax-option corporation.

AB732,18,16 2. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under par. (ad) 2m., but the eligibility for, and the amount of, the credit are based on their payment of amounts under par. (ad) 2m. A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their allocation of the deductions of the qualified research expenses used to determine the credit.

AB732, s. 39 Section 39. 77.92 (4) of the statutes, as affected by 2011 Wisconsin Act 32, is amended to read:

AB732,19,9 77.92 (4) "Net business income," with respect to a partnership, means taxable income as calculated under section 703 of the Internal Revenue Code; plus the items of income and gain under section 702 of the Internal Revenue Code, including taxable state and municipal bond interest and excluding nontaxable interest income or dividend income from federal government obligations; minus the items of loss and deduction under section 702 of the Internal Revenue Code, except items that are not deductible under s. 71.21; plus guaranteed payments to partners under section 707 (c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de), (2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3s), (3t), (3w), (5a), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5n), (5r), (5rm), and (8r); and plus or minus, as appropriate, transitional adjustments, depreciation differences, and basis differences under s. 71.05 (13), (15), (16), (17), and (19); but excluding income, gain, loss, and deductions from farming. "Net business income," with respect to a natural person, estate, or trust, means profit from a trade or business for federal income tax purposes and includes net income derived as an employee as defined in section 3121 (d) (3) of the Internal Revenue Code.

AB732, s. 40 Section 40. Effective date.

AB732,19,11 (1) This act takes effect on January 1, 2012.

AB732,19,12 (End)