AB758: Bill Text

LRB-3674/3

JK:sac:rs

2013 - 2014 LEGISLATURE

2013 Assembly BILL 758

February 11, 2014 - Introduced by Representatives Johnson, Goyke, Sargent, Barnes, Mason, Young, Kessler, Ohnstad, Hebl, Berceau and Zamarripa, cosponsored by Senators Schultz and Harris. Referred to Committee on Ways and Means.

AB758,1,4 An Act to amend 71.05 (6) (a) 15., 71.21 (4) (a), 71.26 (2) (a) 4., 71.34 (1k) (g) and 71.45 (2) (a) 10.; and to create 71.07 (8d), 71.10 (4) (cs), 71.28 (8d), 71.30 (3) (cs), 71.47 (8d) and 71.49 (1) (cs) of the statutes; relating to: an income and franchise tax credit for hiring young people for summer employment.

Analysis by the Legislative Reference Bureau

Under this bill, a business may claim an income and franchise tax credit for an amount of the wages that the business pays to an employee during the taxable year if all of the following apply:

1. The business paid the wages for work performed during the period beginning on May 1 and ending on August 31 of the taxable year.

2. The employee is at least 15 years old, but not more than 19 years old.

3. The employee receives an hourly wage that is at least equal to the federal minimum hourly wage.

4. The employee was a resident of this state on January 1 of the year in which the employee is employed by the taxpayer.

5. The employee resides in a county where the average rate of total unemployment is 6 percent or greater, as determined by the U.S. secretary of labor based on jobs data for March of the year in which the employee is employed by the taxpayer.

The maximum credit amount that a business may claim for the taxable year is $1,500 for each eligible employee, not to exceed $7,500. If the credit amount exceeds the taxpayer's tax liability, the taxpayer does not receive a refund and may not claim the unused amount in subsequent taxable years.

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:

AB758,1 Section 1. 71.05 (6) (a) 15. of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB758,2,9 71.05 (6) (a) 15. Except as provided under s. 71.07 (3p) (c) 5., the amount of the credits computed 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), (4k), (4n), (5e), (5f), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), (8d), and (8r) and not passed through by a partnership, limited liability company, or tax-option corporation that has added that amount to the partnership's, company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1k) (g).

AB758,2 Section 2. 71.07 (8d) of the statutes is created to read:

AB758,2,12 71.07 (8d) Youth summer employment credit. (a) Definitions. In this subsection:

AB758,2,13 1. "Claimant" means a person who files a claim under this subsection.

AB758,2,14 2. "Full-time" means at least 35 hours a week.

AB758,2,18 (b) Filing claims. Subject to the limitations provided in this subsection, a claimant may claim as a credit against the taxes imposed under s. 71.02, up to the amount of the tax, an amount that is equal to the amount of the wages that the claimant paid in the taxable year to an employee, if all of the following apply:

AB758,2,20 1. The claimant paid the wages for work performed during the period beginning on May 1 and ending on August 31 of the taxable year.

AB758,3,1 2. The employee is at least 15 years old, but not more than 19 years old.

AB758,3,3 3. The employee receives an hourly wage that is at least equal to the federal minimum hourly wage.

AB758,3,5 4. The employee was a resident of this state on January 1 of the year in which the employee is employed by the claimant.

AB758,3,9 5. The employee resides in a county where the average rate of total unemployment is 6 percent or greater, as determined by the U.S. secretary of labor based on jobs data for March of the year in which the employee is employed by the claimant.

AB758,3,12 (c) Limitations. 1. The maximum amount that a claimant may claim as credit under this subsection in a taxable year is $1,500 for each eligible employee, not to exceed $7,500.

AB758,3,15 2. No person may claim a credit under this subsection if the person terminates an employee's employment in order to hire an employee for which the person may claim a credit under this subsection.

AB758,3,23 3. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and the amount of, the credit are based on their payment of amounts under par. (b). 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 ownership interests.

AB758,3,25 (d) Administration. Section 71.28 (4) (g) and (h), as it applies to the credit under s. 71.28 (4), applies to the credit under this subsection.

AB758,3 Section 3. 71.10 (4) (cs) of the statutes is created to read:

AB758,4,2 71.10 (4) (cs) Youth summer employment credit under s. 71.07 (8d).

AB758,4 Section 4. 71.21 (4) (a) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB758,4,9 71.21 (4) (a) The amount of the credits computed by a partnership under s. 71.07 (2dd), (2de), (2di), (2dj), (2dL), (2dm), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3s), (3t), (3w), (4k), (4n), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), (8d), and (8r) and passed through to partners shall be added to the partnership's income.

AB758,5 Section 5. 71.26 (2) (a) 4. of the statutes is amended to read:

AB758,4,17 71.26 (2) (a) 4. Plus the amount of the credit computed under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (1dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3t), (3w), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), (8d), (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).

AB758,6 Section 6. 71.28 (8d) of the statutes is created to read:

AB758,4,20 71.28 (8d) Youth summer employment credit. (a) Definitions. In this subsection:

AB758,4,21 1. "Claimant" means a person who files a claim under this subsection.

AB758,4,22 2. "Full-time" means at least 35 hours a week.

AB758,5,2 (b) Filing claims. Subject to the limitations provided in this subsection, a claimant may claim as a credit against the taxes imposed under s. 71.23, up to the amount of the tax, an amount that is equal to the amount of the wages that the claimant paid in the taxable year to an employee, if all of the following apply:

AB758,5,4 1. The claimant paid the wages for work performed during the period beginning on May 1 and ending on August 31 of the taxable year.

AB758,5,5 2. The employee is at least 15 years old, but not more than 19 years old.

AB758,5,7 3. The employee receives an hourly wage that is at least equal to the federal minimum hourly wage.

AB758,5,9 4. The employee was a resident of this state on January 1 of the year in which the employee is employed by the claimant.

AB758,5,13 5. The employee resides in a county where the average rate of total unemployment is 6 percent or greater, as determined by the U.S. secretary of labor based on jobs data for March of the year in which the employee is employed by the claimant.

AB758,5,16 (c) Limitations. 1. The maximum amount that a claimant may claim as credit under this subsection in a taxable year is $1,500 for each eligible employee, not to exceed $7,500.