71.78(8)(d)
(d) The department may allow an examination of information under
par. (c) only if a district attorney petitions a court of record in this state for an order allowing the examination and the court issues an order after finding:
71.78(8)(d)1.
1. There is reasonable cause to believe, based on information believed to be reliable, that a specific criminal act has been committed;
71.78(8)(d)2.
2. There is reason to believe that such information is probative evidence of a matter in issue related to the commission of the criminal act; and
71.78(8)(d)3.
3. The information sought to be examined cannot reasonably be obtained from any other source, unless it is determined that, notwithstanding the reasonable availability of the information from another source, the information constitutes the most probative evidence of a matter in issue relating to the commission of such criminal act.
71.78(8)(e)
(e) If the department determines that examination of information ordered under
par. (d) would identify a confidential informant or seriously impair a civil or criminal tax investigation, the department may deny access and shall certify the reason therefor to the court.
71.78(9)
(9) Disclosure of debtor address. The department may supply the address of a debtor to an agency certifying a debt of that debtor under
s. 71.93 or to a municipality or county certifying a debt of a debtor under
s. 71.935.
71.78(10)
(10) Divulging information to requester. The department shall inform each requester of the total amount of taxes withheld under
subch. X during any reporting period and reported on a return filed by any city, village, town, county, school district, special purpose district or technical college district; whether that amount was paid by the statutory due date; the amount of any tax, fees, penalties or interest assessed by the department; and the total amount due or assessed under
subch. X but unpaid by the filer, except that the department may not divulge tax return information that in the department's opinion violates the confidentiality of that information with respect to any person other than the units of government and districts specified in this subsection. The department shall provide to the requester a written explanation if it fails to divulge information on grounds of confidentiality. The department shall collect from the person requesting the information a fee of $4 for each return.
71.78 History
History: 1987 a. 312;
1987 a. 411 ss.
99,
100,
188;
1991 a. 269,
301;
1993 a. 112,
399;
1995 a. 27 ss.
3420x to
3423g,
9116 (5);
1995 a. 233,
404;
1997 a. 27,
63,
237,
323;
1999 a. 32,
89;
2005 a. 25;
2007 a. 20.
71.78 Note
NOTE: 1991 Wis. Act 301, which affected this section, contains extensive legislative council notes.
71.78 Cross-reference
Cross Reference: See also ss.
Tax 1.11 and
1.13, Wis. adm. code.
71.80
71.80
General administrative provisions. 71.80(1)
(1)
Department duties and powers. 71.80(1)(a)(a) The department shall assess incomes as provided in this chapter and in performance of such duty the department shall possess all powers now or hereafter granted by law to the department in the assessment of personal property and also the power to estimate incomes.
71.80(1)(b)
(b) In any case of 2 or more organizations, trades or businesses (whether or not incorporated, whether or not organized in the United States and whether or not affiliated) owned or controlled directly or indirectly by the same interests, the secretary or the secretary's delegate may distribute, apportion or allocate gross income, deductions, credits or allowances between or among such organizations, trades or businesses, if the secretary determines that such distribution, apportionment or allocation is necessary in order to prevent evasion of taxes or clearly to reflect the income of any of such organizations, trades or businesses. The authority granted under this subsection is in addition to, and not a limitation of or dependent on, the provisions of
sub. (23) and
ss. 71.05 (6) (a) 24. and
(b) 45.,
71.26 (2) (a) 7. and
8.,
71.34 (1k) (j) and
(k), and
71.45 (2) (a) 16. and
17.
71.80(1)(c)
(c) The department may make such regulations as it shall deem necessary in order to carry out this chapter.
71.80(1)(d)
(d) The department may employ such clerks and specialists as are necessary to carry into effective operation this chapter. Salaries and compensations of such clerks and specialists shall be charged to the proper appropriation for the department.
71.80(1)(e)
(e) Representatives of the department directed by it to accept payment of income or franchise taxes shall file bonds with the secretary of administration in such amount and with such sureties as the state treasurer shall direct and approve.
71.80(2)
(2) Notice to taxpayer by department. The department shall notify each taxpayer by mail of the amount of income or franchise taxes assessed against the taxpayer and of the date when the taxes become delinquent.
71.80(3)
(3) Crediting of overpayments on individual or separate returns. In the case of any overpayment, refundable credit or refund on an individual or separate return, the department, within the applicable period of limitations, may credit the amount of overpayment, refundable credit or refund including any interest allowed, against any liability in respect to any tax collected by the department, a debt under
s. 71.93 or
71.935 or a certification under
s. 49.855 on the part of the person who made the overpayment or received the refundable credit or the refund and shall refund any balance to the person. The department shall presume that the overpayment, refundable credit or refund is nonmarital property of the filer. Within 2 years after the crediting, the spouse or former spouse of the person filing the return may file a claim for a refund of amounts credited by the department if the spouse or former spouse shows by clear and convincing evidence that all or part of the state tax overpayment, refundable credit or refund was nonmarital property of the nonobligated spouse.
71.80(3m)
(3m) Crediting of overpayments on joint returns. For married persons, unless within 20 days after the date of the notice under
par. (c) the nonobligated spouse shows by clear and convincing evidence that the overpayment, refundable credit or refund is the nonmarital property of the nonobligated spouse, notwithstanding
s. 766.55 (2) (d), the department may credit overpayments, refundable credits and refunds, including any interest allowed, resulting from joint returns under this chapter as follows:
71.80(3m)(a)
(a) Against any liability of either spouse or both spouses in respect to an amount owed the department, a certification under
s. 49.855 that is subject to
s. 766.55 (2) (b) or a debt under
s. 71.93 or
71.935 that is subject to
s. 766.55 (2) (b) and that was incurred during marriage by a spouse after December 31, 1985, or after both spouses are domiciled in this state, whichever is later, except as provided in
s. 71.10 (6) (a) and
(b) and
(6m).
71.80(3m)(b)
(b) Against the liability of a spouse in the proportion that the Wisconsin adjusted gross income which would have been the property of the spouse but for the marriage has to the adjusted gross income of both spouses as follows:
71.80(3m)(b)1.
1. In respect to an amount owed the department that was incurred before January 1, 1986, or before marriage, whichever is later.
71.80(3m)(c)
(c) If the department determines that a spouse is otherwise entitled to a state tax refund or homestead or farmland credit, it shall notify the spouses under
s. 71.74 (11) that the state intends to reduce any state tax refund or a refundable credit due the spouses by the amount credited against any liability under
par. (a) or
(b) or both.
71.80(3m)(d)
(d) If a spouse does not receive notice under
par. (c) and if the department incorrectly credits the state tax overpayment, refund or a refundable credit of a spouse or spouses against a liability under
par. (a) or
(b) or both, a claim for refund of the incorrectly credited amount may be filed under
s. 71.75 (5) within 2 years after the date of the offset that was the subject of the notice under
par. (c).
71.80(4)
(4) Penalties. Unless specifically provided in this subchapter, the penalties under
subch. XIII apply for failure to comply with this subchapter unless the context requires otherwise.
71.80(5)
(5) Penalties not deductible. No penalty imposed by this chapter, or by
subch. III of ch. 77 may be deducted from gross income in arriving at net income taxable under this chapter.
71.80(6)
(6) Prosecutions by attorney general. The attorney general is authorized, upon the request of the secretary of revenue, to represent the state or to assist the district attorney in the prosecution of any case arising under
s. 71.83 (2) (a) 1. and
(b) 1. and
2.
71.80(6m)
(6m) Venue. A proceeding for a criminal violation under this chapter may be brought in the circuit court for Dane County or for the county in which the defendant resides or is located when charged with the violation.
71.80(7)
(7) Publication of notices in administrative register. The department shall annually publish notice of the standard deduction amounts and the brackets for the individual income tax in the administrative register.
71.80(8)
(8) Receipt for payment of taxes. The department shall accept payments of income or franchise taxes in accordance with this chapter, and upon request shall give a printed or written receipt therefor.
71.80(9)
(9) Records may be required of taxpayer. Whenever the department deems it necessary that a person subject to an income or franchise tax should keep records to show whether or not the person is liable to tax, the department may serve notice upon the person and require such records to be kept as will include the entire net income of the person and will enable the department to compute the taxable income. The department may require any person who keeps records in machine-readable form for federal income tax purposes to keep those records in the same form for purposes of the taxes under this chapter.
71.80(10)(a)(a) If any person, including an officer of a corporation, required by law to file a return fails to file the return within 60 days after the time required and refuses to file the return within 30 days after a request by the department to do so, the circuit court, upon petition by the department, shall issue a court order requiring that person to file a return. Any person upon whom a court order has been served shall file a return within 20 days after the service of the court order. The petition shall be heard and determined on the return day or on a later date that the court fixes, having regard for the speediest possible determination of the case consistent with the rights of the parties.
71.80(10)(b)
(b) The department shall file a petition for a court order in a circuit court for the county in which the respondent in the action resides.
71.80(10)(c)
(c) Filing a return after the time prescribed by law shall not relieve any person, including an officer of a corporation, from any penalties whether or not the department filed a petition for a court order under this subsection.
71.80(11)
(11) Return presumed correct. The department shall presume the incomes reported on the current return to be correct for the purpose of preparing initial assessments.
71.80(12)
(12) Department considered lawful attorney for nonresident. 71.80(12)(a)(a) The transaction of business or the performance of personal services in this state or the derivation of income from property the income from which has a taxable situs in this state by any nonresident person, except where the nonresident is a foreign corporation that has been licensed under
ch. 180, shall be all of the following:
71.80(12)(a)1.
1. Considered an irrevocable appointment by the nonresident, binding upon the nonresident or the nonresident's personal representative, of the department of financial institutions to be the nonresident's lawful attorney upon whom may be served any notice, order, pleading, or process, including any notice of assessment, denial of application for abatement, or denial of claim for refund, by any administrative agency or in any proceeding by or before any administrative agency, or in any proceeding or action in any court, to enforce or effect full compliance with or involving the provisions of this chapter.
71.80(12)(a)2.
2. A signification of the nonresident's agreement that any notice, order, pleading, or process described in
subd. 1. that is so served shall be of the same legal force and validity as if served on the nonresident personally, or on the nonresident's personal representative.
71.80(12)(b)
(b) The transaction of business in this state or the derivation of income that has a situs in this state under the provisions of this chapter by any person while a resident of this state shall be all of the following:
71.80(12)(b)1.
1. Considered an irrevocable appointment by that person, binding upon that person or that person's personal representative, effective upon that person becoming a nonresident of this state, of the department of financial institutions to be that person's true and lawful attorney upon whom may be served any notice, order, pleading, or process, including any notice of assessment, denial of application for abatement, or denial of claim for refund, by any administrative agency or in any proceeding by or before an administrative agency, or in any proceeding or action in any court, to enforce or effect full compliance with or involving the provisions of this chapter.
71.80(12)(b)2.
2. A signification of that person's agreement that any notice, order, pleading, or process described in
subd. 1. that is so served shall be of the same legal force and validity as if served on that person personally, or upon that person's personal representative.
71.80(12)(c)1.1. Service under
par. (a) 1. or
(b) 1. shall be made by serving a copy of the notice, order, pleading, or process upon the department of financial institutions or by filing a copy of the notice, order, pleading, or process with the department of financial institutions.
71.80(12)(c)2.
2. Service under
subd. 1. upon a person, or that person's personal representative, shall be sufficient if all of the following conditions are met:
a. Within 10 days of completion of service, notice of the service and a copy of the served notice, order, pleading, or process are sent by mail by the state department, officer, or agency making the service to the person, or that person's personal representative, at that person's last-known address.
b. An affidavit of compliance with this paragraph is filed with the department of financial institutions.
71.80(12)(c)3.
3. The department of financial institutions shall keep a record of all notices, orders, pleadings, processes, and affidavits served upon or filed with it under this section, noting in the record the day and hour of service or filing.
71.80(13)
(13) Self-insurers. The department shall compile and maintain a current list of names and addresses of persons who indicate they are self-insurers as required by
s. 71.65 (4). The list shall be furnished to the office of the commissioner of insurance on request.
71.80(14)(b)
(b) The fact that an individual's name is signed to a return, statement or other document shall be prima facie evidence for all purposes that the return, statement or other document was actually signed by that person.
71.80(15)(a)(a) In this subsection, "employer" means the resident person or firm which engages the services of an entertainer, as defined in
s. 71.01 (2), or an entertainment corporation or, in the absence of that person or firm, the resident person last having receipt, custody or control of the proceeds of the entertainment event.
71.80(15)(b)
(b) All entertainers, except entertainers who work for an entertainment corporation, and entertainment corporations not otherwise employed or regularly engaged in business in this state shall file a surety bond with the department of revenue at least 7 days before a performance. That bond shall be payable to the department to guarantee payment of income, franchise, sales and use taxes, income taxes withheld under
subch. X, penalties and interest. The amount of the bond shall be 6% of either the total contract price on all contracts that exceed $3,200 or, if the total contract price is not readily determinable and the department's estimate of the total remuneration to be received by the entertainer or entertainment corporation exceeds $3,200, 6% of the department's estimate. Amounts previously earned in this state by an entertainer or entertainment corporation during the same calendar year for which no bond or cash deposit has been filed under this paragraph or for which no amounts have been withheld under
s. 71.64 (5) shall be added together to determine the total contract price. The department shall approve the form and content of the bond. The bond shall remain in force until the liability under the bond is released by the department.
71.80(15)(c)
(c) In place of the bond under
par. (b) and with the department's approval, an entertainer or entertainment corporation may deposit with the department money equal to the face value of the bond required under
par. (b). The department shall retain the money until it determines the depositor's liability for state income, franchise, sales and use taxes and income tax withheld under
subch. X. If the deposit exceeds the liability, the department shall refund the difference to the depositor without interest.
71.80(15)(d)
(d) If the department concludes that a bond or money deposit is not necessary to protect the revenues of the state, it may waive the requirements of
pars. (b) and
(c).
71.80(15)(e)
(e) Each person who is an employer of an entertainer or entertainment corporation, as defined in
s. 71.63 (3), shall, before paying for those services, require proof that the bond required by
par. (b) or the money deposit required by
par. (c) has been provided or that the department has waived those requirements. If proof is not provided, the person shall withhold and immediately transmit to the department from that person's payment the amount for which a bond should have been provided under
par. (b). Failure to withhold or transmit the amount required under this paragraph or under
s. 71.64 (5) shall make the person required to withhold it personally liable for the amount required under this paragraph.
71.80(15)(f)
(f) An employer of an entertainer or entertainment corporation under
s. 71.63 (3) (b) who is required to withhold moneys under
par. (e) or
s. 71.64 (5) and who has no direct knowledge of the total contract price to be paid an entertainer or entertainment corporation is not liable under
par. (e) if the employer withholds moneys based upon a signed statement provided by the entertainer, the entertainment corporation or the promoter attesting to the amount of the total contract price. The employer shall deliver the signed statement to the department within 30 days after the date of the performance. Statements under this paragraph are subject to
s. 71.83 (2) (b) 1. and
2.
71.80(16)
(16) Surety bond; nonresident contractor. 71.80(16)(a)(a) All nonresident persons, whether incorporated or not, engaging in construction contracting in this state as contractor or subcontractor and not otherwise regularly engaged in business in this state, shall file a surety bond with the department, payable to the department of revenue, to guarantee the payment of income or franchise taxes, required unemployment insurance contributions, sales and use taxes and income taxes withheld from wages of employees, together with any penalties and interest thereon. The department shall approve the form and contents of such bond. The amount of the bond shall be 3% of the contract or subcontract price on all contracts of $50,000 or more or 3% of contractor's or subcontractor's estimated cost-and-profit under a cost-plus contract of $50,000 or more. When the aggregate of 2 or more contracts in one calendar year is $50,000 or more the amount of the bond or bonds shall be 3% of the aggregate amount of such contracts. Such surety bond must be filed within 60 days after construction is begun in this state by any such contractor or subcontractor on any contract the price of which is $50,000 or more (or the estimated cost-and-profit of which is $50,000 or more), or within 60 days after construction is begun in this state on any contract for less than $50,000, when the amount of such contract, when aggregated with any other contracts, construction on which was begun in this state in the same calendar year, equals or exceeds $50,000. If the department concludes that no bond is necessary to protect the tax revenues of the state, including contributions under
ch. 108, the requirements under this subsection may be waived by the secretary of revenue or the secretary's designated departmental representative. The bond shall remain in force until the liability thereunder is released by the secretary or the secretary's designated departmental representative.
71.80(16)(b)
(b) A construction contractor required to file a surety bond under
par. (a) may, in lieu of such requirement, but subject to approval by the department, deposit with the secretary of administration an amount of cash equal to the face of the bond that would otherwise be required. If an offer to deposit is made, the department shall issue a certificate to the secretary of administration authorizing said secretary to accept payment of such moneys and to give his or her receipt therefor. A copy of such certificate shall be mailed to the contractor who shall, within the time fixed by the department, pay such amount to the secretary of administration. A copy of the receipt of the secretary of administration shall be filed with the department. Upon final determination by the department of such contractor's liability for state income or franchise taxes, required unemployment insurance contributions, sales and use taxes, and income taxes withheld from wages of employees, interest and penalties, by reason of such contract or contracts, the department shall certify to the secretary of administration the amount of taxes, penalties, and interest as finally determined, shall instruct the secretary of administration as to the proper distribution of such amount, and shall state the amount, if any, to be refunded to such contractor. The secretary of administration shall make the payments directed by such certificate within 30 days after receipt thereof. Amounts refunded to the contractor shall be without interest.
71.80(16)(c)
(c) All persons subject to this subsection shall notify the department of revenue of the completion of a construction project in this state within 30 days after such completion.
71.80(17)
(17) Tax receipts transmitted to the secretary of administration. Within 15 days after receipt of any income or franchise tax payments, the department shall transmit the same to the secretary of administration.
71.80(18)
(18) Timely filing defined. Documents and payments required or permitted by this chapter that are mailed shall be considered furnished, reported, filed or made on time, if mailed in a properly addressed envelope, with postage duly prepaid, which envelope is postmarked, or marked or recorded electronically as provided under section
7502 (f) (2) (c) of the Internal Revenue Code, before midnight of the date prescribed for such furnishing, reporting, filing or making, provided such document or payment is actually received by the department or at the destination that the department or the department of administration prescribes within 5 days of such prescribed date. Documents and payments that are not mailed are timely if they are received on or before the due date by the department or at the destination that the department or the department of administration prescribes. For purposes of this subsection, "mailed" includes delivery by a delivery service designated under section
7502 (f) of the Internal Revenue Code.
71.80 Cross-reference
Cross Reference: See also s.
Tax 2.08, Wis. adm. code.
71.80(19)(a)(a)
Rounding amounts. With respect to any amount required to be shown on a form prescribed for any return, statement or other document required by this chapter, if the amount of such item is other than a whole dollar amount the fractional part of a dollar shall be disregarded unless it amounts to 50 cents or more, in which case the amount (determined without regard to the fractional part of a dollar) shall be increased to the next whole dollar.
71.80(19)(b)
(b)
Election not to use whole dollar amounts. Any person making a return, statement or other document required by this chapter shall be allowed to make such return, statement or other document without regard to
par. (a).
71.80(19)(c)
(c)
Inapplicability to computation of amount. Paragraph (a) does not apply to items which must be taken into account in making the computations necessary to determine the total amount required to be shown on a form, statement or other document but applies only to such final amount.
71.80(20)
(20) Electronic filing. If the internal revenue service requires a person to file information returns or wage statements electronically for federal income tax purposes, the person shall also file the comparable state information returns or wage statements electronically with the department of revenue for income or franchise tax purposes.
71.80 Cross-reference
Cross Reference: See also s.
Tax 2.04, Wis. adm. code.
71.80(21)
(21) Business entity conversion. Notwithstanding any provision of
ss. 179.76,
180.1161,
181.1161, and
183.1207, the conversion of a business entity to another form of business entity under
s. 179.76,
180.1161,
181.1161, or
183.1207 shall be treated for state tax purposes in the same manner as the conversion is treated for federal tax purposes.
71.80(22)
(22) Business entity merger. Notwithstanding any provision of
ss. 179.77,
180.1101,
180.1104,
181.1101,
181.1104, and
183.1201, the merger of a business entity with one or more business entities under
s. 179.77,
180.1101,
180.1104,
181.1101,
181.1104, or
183.1201 shall be treated for state tax purposes in the same manner as the merger is treated for federal tax purposes.
71.80(23)(a)1.
1. The related entity to which the taxpayer paid, accrued, or incurred the interest expenses or rental expenses during the taxable year directly or indirectly paid, accrued, or incurred such amounts in the same taxable year to a person who is not a related entity or the related entity to which the taxpayer paid, accrued, or incurred such expenses is a holding company or a direct or indirect subsidiary of a holding company, as defined in
12 USC 1841 (a) or (l) or
12 USC 1467a (a) (1) (D), not including any entity that is organized under the laws of another jurisdiction and that primarily holds and manages investments of a bank, subsidiary, or affiliate. For purposes of this subdivision, "interest" does not include interest that is paid in connection with any debt that is incurred to acquire the taxpayer's assets or stock under section
368 of the Internal Revenue Code. If a portion of such an interest expense or rental expense is paid, accrued, or incurred in the same taxable year to a person who is not a related entity, that portion shall be allowed as a deduction to the taxpayer.
71.80(23)(a)2.
2. The related entity was subject to tax on, or measured by, its net income or receipts in this state or any state, U.S. possession, or foreign country; the related entity's tax base in such state, U.S. possession, or foreign country included the income received from the taxpayer for the interest expenses or rental expenses; the related entity's aggregate effective tax rate applied to such income or receipts was at least 80 percent of the taxpayer's aggregate effective tax rate; and the related entity is not a real estate investment trust under section
856 of the Internal Revenue Code, other than a qualified real estate investment trust. For purposes of this subdivision, "any state, U.S. possession, or foreign country" does not include any state, U.S. possession, or foreign country under the laws of which the taxpayer files with the related entity, or the related entity files with another entity, a combined income tax report or return, a consolidated income tax report or return, or any other report or return that is due because of the imposition of a tax that is measured on or by income or receipts, if the report or return results in eliminating the tax effects of transactions, directly or indirectly, between either the taxpayer and the related entity or between the related entity and another entity.
71.80(23)(a)3.
3. The taxpayer establishes that the transaction satisfies any other conditions that the department considers relevant, based on the facts and circumstances, to determine that the primary motivation for the transaction was one or more business purposes other than the avoidance or reduction of state income or franchise taxes; that the transaction changed the economic position of the taxpayer in a meaningful way apart from tax effects; and that the interest expenses or rental expenses were paid, accrued, or incurred using terms that reflect an arm's-length relationship.
71.80(23)(b)
(b) Notwithstanding
par. (a), the deductions provided under
ss. 71.05 (6) (b) 45.,
71.26 (2) (a) 8.,
71.34 (1k) (k), and
71.45 (2) (a) 17. shall not be allowed for any interest expenses or rental expenses that are directly or indirectly paid, accrued, or incurred to, or in connection directly or indirectly with one or more direct or indirect transactions with, one or more related entities, if the aggregate amount paid, accrued, or incurred for those related entity transactions is not disclosed on a separate form prescribed by the department in the manner prescribed by the department.
71.805
71.805
Tax avoidance transactions voluntary compliance program. 71.805(1)(a)
(a) "Tax avoidance transaction" means a transaction, plan, or arrangement devised for the principal purpose of avoiding federal or Wisconsin income or franchise tax. "Tax avoidance transaction" includes a listed transaction as provided under U.S. department of the treasury regulations as of October 27, 2007, and may include a transaction, as determined by the department, that provides a tax benefit for Wisconsin income or franchise tax purposes without providing a similar benefit for federal income tax purposes.
71.805(1)(b)
(b) "Taxpayer" means a person who is subject to the taxes imposed under this chapter and who has a tax liability attributable to using a tax avoidance transaction for any taxable year beginning before January 1, 2007.
