71.10(5s)(a)(a) For taxable years beginning after December 31, 2011, individuals may not have the option of making a designation to more than 10 individual income checkoffs and the department may not place more than 10 checkoffs on the income tax form. If a checkoff is created for taxable years beginning after December 31, 2011, and before January 1, 2015, the department may not place it on the form, and no designations may be made to the checkoff, for a taxable year that begins before January 1, 2015, except that this limitation does not apply to a checkoff created in a bill that is introduced in both houses of the legislature before June 1, 2011. The limitations in this paragraph do not apply to the checkoff under
sub. (5fm).
71.10(5s)(b)
(b) For taxable years beginning after December 31, 2011, there may be no individual income tax checkoffs of a temporary nature other than the checkoff under
sub. (5fm).
71.10(5s)(c)
(c) Beginning in September 2014, based on the amounts certified by the secretary of revenue in August or September 2013, and 2014, as specified in
subs. (5) (h),
(5e) (h),
(5f) (h),
(5g) (h),
(5h) (h),
(5i) (h),
(5j) (h),
(5k) (h),
(5km) (h), and
(5m) (h), and for every 2-year period thereafter, the secretary of revenue shall rank the checkoffs based on the total amount of designations received for each checkoff for each 2-year period. For each 2-year period, beginning with 2014, the secretary of revenue shall rank every checkoff that is created under this section.
71.10(5s)(d)1.1. If more than 11 checkoffs exist under this section after August 14, 2014, and every 2 years thereafter, not including the checkoff under
sub. (5fm), only the 8 highest ranking checkoffs for which designations were made in the previous 2-year period may appear on the income tax form for the next 2 taxable years.
71.10(5s)(d)2.
2. The remaining 2 checkoffs for which designations may be made and which shall be placed on the income tax form for the next 2 taxable years, in place of the 2 lowest ranking checkoffs, shall be checkoffs that have not received any designations during the previous 2-year period.
71.10(5s)(d)3.
3. The 2 remaining checkoffs, described under
subd. 2., shall be the 2 oldest checkoffs, based on the date each checkoff was placed on a list of checkoffs, maintained by the department, that are eligible to be placed on the form. If 2 or more checkoffs have been placed on the list at the same time, the oldest checkoff shall then be calculated according to their effective dates.
71.10(5s)(d)4.
4. If 10 checkoffs exist under this section after August 14, 2014, not including the checkoff under
sub. (5fm), those 10 checkoffs may appear on the income tax form for the next 2 taxable years.
71.10(5s)(d)5.
5. If 11 checkoffs exist under this section after August 14, 2014, not including the checkoff under
sub. (5fm), only the 9 highest ranking checkoffs for which designations were made in the previous 2-year period may appear on the income tax form for the next 2 taxable years. The remaining checkoff for which designations may be made and which shall be placed on the income tax form for the next 2 taxable years, in place of the lowest ranking checkoff, shall be a checkoff that has not received any designations during the previous 2-year period. This last checkoff shall be selected using the method described under
subd. 3.
71.10(5s)(e)
(e) For any taxable year that begins after December 31, 2014, individuals may not make a designation for any checkoff which did not generate at least an average of $50,000 of designations per year over the most recent 3-year period as certified by the secretary of revenue under
subs. (5) (h) 3.,
(5e) (h) 2.,
(5f) (h) 2.,
(5fm) (h) 2.,
(5g) (h) 2.,
(5i) (h) 2.,
(5j) (h) 2.,
(5k) (h) 2.,
(5km) (h) 2., and
(5m) (h) 2. Once a checkoff is affected by this paragraph, no further checkoffs may be designated to that checkoff in any taxable year.
71.10(6)(a)(a)
Joint returns. Persons filing a joint return are jointly and severally liable for the tax, interest, penalties, fees, additions to tax and additional assessments under this chapter applicable to the return. Except as provided in
par. (e), a person shall be relieved of liability in regard to a joint return in the manner specified in section
6015 (a) to (d) and (f) of the Internal Revenue Code.
71.10(6)(b)
(b)
Separate returns. Except as provided in
par. (e), a spouse filing a separate return may be relieved of liability for the tax, interest, penalties, fees, additions to tax and additional assessments under this chapter in the manner specified in section
66 (c) of the Internal Revenue Code. The department may not apply
ch. 766 in assessing a taxpayer with respect to marital property income the taxpayer did not report if that taxpayer failed to notify the taxpayer's spouse about the amount and nature of the income before the due date, including extensions, for filing the return for the taxable year in which the income was derived. The department shall include all of that marital property income in the gross income of the taxpayer and exclude all of that marital property income from the gross income of the taxpayer's spouse.
71.10(6)(c)
(c)
Marital property agreements. The department of revenue shall notify a taxpayer whose separate return is under audit that a marital property agreement or unilateral statement under
ch. 766 is effective for tax purposes for any period during which both spouses are domiciled in this state only if it is filed with the department before any assessment resulting from the audit is issued. A marital property agreement or unilateral statement under
ch. 766 does not affect the determination of the income that is taxable by this state, or of the person who is required to report taxable income to this state, during the period that one or both spouses are not domiciled in this state or if it was not filed with the department before an assessment was issued.
71.10(6)(d)
(d)
Part-year residents and nonresidents. If a spouse is not domiciled in this state for the entire taxable year, the tax liability and reporting obligation of both spouses during the period a spouse is not domiciled in this state shall be determined without regard to
ch. 766 except as provided in this chapter.
71.10(6)(e)
(e)
Application for relief. A person who seeks relief from liability under
par. (a) or
(b) shall apply for relief with the department, on a form prescribed by the department, within 2 years after the date on which the department first begins collection activities after July 27, 2005.
71.10(6m)
(6m) Returns of formerly married and remarried persons. 71.10(6m)(a)(a) Except as provided in
par. (c), a formerly married or remarried person filing a return for a period during which the person was married may be relieved of liability for the tax, interest, penalties, fees, additions to tax and additional assessments under this chapter from that period as if the person were a spouse under section
66 (c) of the Internal Revenue Code. The department may not apply
ch. 766 in assessing the former spouse of the person with respect to marital property income that the former spouse did not report if that former spouse failed to notify the person about the amount and nature of the income before the due date, including extensions, for filing the return for the taxable year during which the income was derived. The department shall include all of that marital property income in the gross income of the former spouse and exclude all of that marital property income from the gross income of the person.
71.10(6m)(b)
(b) The department may not apply
ch. 766 or
s. 71.55 (1),
71.61 (1) or
71.80 (3) or
(3m) to collect from an individual for any tax liability owed to the department by the individual or by the former spouse of the individual if a judgment of divorce under
ch. 767 apportions that liability to the former spouse of the individual and if the individual includes with his or her tax return a copy of that portion of the judgment of divorce that relates to the apportionment of tax liability.
71.10(6m)(c)
(c) A person who seeks relief from liability under
par. (a) shall apply for relief with the department as provided under
sub. (6) (e).
71.10(7)
(7) Minnesota income tax reciprocity. 71.10(7)(a)(a) For purposes of income tax reciprocity reached with the state of Minnesota under
s. 71.05 (2), whenever the income taxes on residents of one state which would have been paid to the 2nd state without reciprocity exceed the income taxes on residents of the 2nd state which would have been paid to the first state without reciprocity, the state with the net revenue loss shall receive from the other state the amount of the loss. Interest shall be payable on all delinquent balances relating to taxable years beginning after December 31, 1977. The secretary of revenue may enter into agreements with the state of Minnesota specifying the reciprocity payment due date, conditions constituting delinquency, interest rates and the method of computing interest due on any delinquent amounts.
71.10(7)(b)
(b) The data used for computing the loss to either state shall be determined by the respective departments of revenue of both states on or before November 1 of the year following the close of the previous calendar year. If an agreement cannot be reached as to the amount of the loss, the secretary of revenue of this state and the commissioner of taxation of the state of Minnesota shall each appoint a member of a board of arbitration and these members shall appoint a 3rd member of the board. The board shall select one of its members as chairperson. The board may administer oaths, take testimony, subpoena witnesses and require their attendance, require the production of books, papers and documents and hold hearings at such places as it deems necessary. The board shall then make a determination as to the amount to be paid the other state which shall be conclusive. This state shall pay no more than one-half of the cost of such arbitration.
71.10(7)(c)
(c) For taxable years beginning after December 31, 2000, this state shall pay Minnesota interest on any reciprocity payment that is due under this subsection. Interest shall be calculated according to the Laws of Minnesota 2002
Chapter 377, or at another rate and under another method of calculation that is agreed to by Minnesota and Wisconsin.
71.10(7e)
(7e) Illinois income tax reciprocity. 71.10(7e)(a)(a) For purposes of income tax reciprocity reached with the state of Illinois under
s. 71.05 (2), whenever the income taxes on residents of one state which would have been paid to the 2nd state without reciprocity exceed the income taxes on residents of the 2nd state which would have been paid to the first state without reciprocity, the state with the net revenue loss shall receive from the other state the amount of the loss. Interest shall be payable on all delinquent balances relating to taxable years beginning after December 31, 1999. The secretary of revenue may enter into agreements with the state of Illinois specifying the reciprocity payment due date, conditions constituting delinquency, interest rates and the method of computing interest due on any delinquent amounts.
71.10(7e)(b)
(b) The data used for computing the loss to either state shall be determined by the respective departments of revenue of both states on or before December 1 of the year following the close of the previous calendar year. If an agreement cannot be reached as to the amount of the loss, the secretary of revenue of this state and the director of taxation of the state of Illinois shall each appoint a member of a board of arbitration and these members shall appoint a 3rd member of the board. The board shall select one of its members as chairperson. The board may administer oaths, take testimony, subpoena witnesses and require their attendance, require the production of books, papers and documents and hold hearings at such places as it considers necessary. The board shall then make a determination as to the amount to be paid the other state which shall be conclusive. This state shall pay no more than 50 percent of the cost of such arbitration.
71.10(7e)(c)1.1. The payments under this subsection may be made only if the secretary of revenue of this state and the director of taxation of the state of Illinois enter into a written agreement relating to income tax reciprocity that applies to taxable years beginning after December 31, 1997.
71.10(7e)(c)2.
2. Subject to
subd. 1., for taxable years beginning after December 31, 1997, and before January 1, 1999, the maximum amount that may be paid to Illinois under this subsection is $5,500,000, and for taxable years beginning after December 31, 1998, and before January 1, 2000, the maximum amount that may be paid to Illinois under this subsection is $8,250,000.
71.10(7m)
(7m) Discharge of indebtedness; modifications. If a person excludes from gross income an amount of income from a discharge of indebtedness because of discharges of debts described under section
108 (a) of the internal revenue code, the person shall make the adjustments specified in section
108 (b) of the internal revenue code, but the net operating loss under
s. 71.01 (14), not the federal net operating loss, and Wisconsin credits, not federal credits, and the capital loss carry-forward as limited under
s. 71.05 (10) (c), not the federal capital loss carry-forward, shall be applied, and the reduction rate for a credit carry-over is 6.93 percent, not 33 1/3 percent.
71.10(8)
(8) 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.
71.10(9)
(9) Publication of standard deduction and tax brackets. The department of revenue shall annually publish notice of the standard deduction amounts and the brackets for the individual income tax in the administrative register.
71.10 History
History: 1987 a. 312;
1987 a. 411 ss.
94,
97,
176 to
179;
1987 a. 422 s.
4;
1989 a. 31,
56,
359;
1991 a. 39;
1993 a. 16,
184;
1995 a. 27,
209,
418,
453;
1997 a. 27,
63,
237,
248;
1999 a. 9,
167;
2001 a. 16,
109;
2003 a. 33,
99,
135,
176,
255,
321;
2005 a. 25,
49,
71,
74,
177,
178,
323,
361,
460,
479,
483;
2007 a. 1,
20,
96,
97;
2009 a. 2,
28,
89,
265,
269,
295,
332;
2011 a. 32,
76,
169,
212,
222,
232;
2011 a. 260 ss.
25,
80;
2013 a. 20,
62,
145;
2013 a. 165 s.
114;
2015 a. 55,
197,
218.
SPECIAL PROVISIONS APPLICABLE TO FIDUCIARIES
71.12
71.12
Conformity. Unless specifically provided in this subchapter, fiduciaries shall be subject to all of the provisions, requirements and liabilities of this chapter, so far as applicable, unless the context requires otherwise.
71.12 History
History: 1987 a. 312.
71.122
71.122
Definition. In this subchapter, “Wisconsin taxable income" means federal taxable income, as defined in
s. 71.01 (4), as modified under
s. 71.05 (6) to
(12),
(19) and
(20).
71.122 History
History: 1997 a. 27.
71.125
71.125
Imposition of tax. 71.125(1)
(1) Except as provided in
sub. (2), the tax imposed by this chapter on individuals and the rates under
s. 71.06 (1),
(1m),
(1n),
(1p),
(1q), and
(2) shall apply to the Wisconsin taxable income of estates or trusts, except nuclear decommissioning trust or reserve funds, and that tax shall be paid by the fiduciary.
71.125(2)
(2) Each electing small business trust, as defined in section
1361 (e) (1) of the Internal Revenue Code, is subject to tax at the highest rate under
s. 71.06 (1),
(1m),
(1n),
(1p), or
(1q), whichever taxable year is applicable, on its income as computed under section
641 of the Internal Revenue Code, as modified by
s. 71.05 (6) to
(12),
(19) and
(20).
71.13
71.13
Filing returns. 71.13(1)(1)
Estate or trust. Annual returns of income of an estate or a trust shall be made to the department by the fiduciary thereof at or before the time such income is required to be reported to the internal revenue service under the internal revenue code. Under such rules as the department prescribes, a return made by one of 2 or more joint fiduciaries shall be sufficient compliance with the requirements of this section. A return made pursuant to this subsection shall contain a statement that the fiduciary has sufficient knowledge of the affairs of the person for whom the return is made to enable him or her to make the return, and that the return is, to the best of his or her knowledge and belief, true and correct.
71.13(1m)
(1m) Schedules to beneficiaries. Every fiduciary who is required to file a return under
sub. (1) shall, on or before the due date of the return, including extensions, provide a schedule to each beneficiary whose share of income, deductions, credits, or other items of the fiduciary may affect the beneficiary's tax liability under this chapter. The schedule shall separately indicate the beneficiary's share of each item.
71.13(2)
(2) Returns required prior to closing estate or trust. 71.13(2)(a)(a) A personal representative or trustee applying to a court having jurisdiction for a discharge of his or her trust and a final settlement of his or her accounts, before the application is granted, shall file all of the following with the department:
71.13(2)(a)1.
1. Returns of income received by the decedent, any previous guardian, personal representative, or trustee, during each of the years open to assessment under
s. 71.77, if the returns had not previously been filed, including a return of income for the year of death to the date of death.
71.13(2)(a)2.
2. Returns of income received during the period of the personal representative's or trustee's administration or trust except for the final income tax year of the estate or trust.
71.13(2)(a)3.
3. Sales and use tax returns and withholding returns or reports that were required to be filed, if not previously filed.
71.13(2)(b)
(b) Upon receipt of the returns described in
par. (a), the department shall immediately determine the amount of taxes including interest, penalties, and costs to be payable, as well as any delinquent income, withholding, sales, and use taxes, penalties, interest, and costs due, and shall certify those amounts to the court. The court shall then enter an order directing the personal representative or trustee to pay the amounts found to be due by the department and take the department's receipt for the amount paid. The receipt shall be evidence of the payment and shall be filed with the court before a final distribution of the estate or trust is ordered and the personal representative or trustee is discharged. The filing of the receipt shall in no manner affect the obligation of the personal representative or trustee to file income, sales, and withholding returns covering transactions reportable during the final taxable year of the estate or trust and to pay income, sales, use and withholding taxes, penalties, interest, and costs due as the result of such transactions.
71.13(3)
(3) Required filing may be dispensed with by court. Returns of income required to be made by
sub. (2) may be dispensed with by order of the court having jurisdiction in cases where it is clearly evident to the court that no income tax is due or to become due from the trust or estate.
71.14
71.14
Situs of income. For purposes of determining the situs of income under this subchapter:
71.14(1)
(1) The estate of a decedent shall be considered resident at the domicile of the decedent at the time of his or her death.
71.14(2)
(2) A trust created at death by will, contract, declaration of trust or implication of law by a decedent who at the time of death was a resident of this state shall be considered resident at the domicile of the decedent at the time of the decedent's death until transferred by the court having jurisdiction under
s. 72.27 to another court's jurisdiction. After jurisdiction is transferred, the trust shall be considered resident at the place to which jurisdiction is transferred. The hearing to transfer jurisdiction shall be held only after giving written notice to the department of revenue under
s. 879.05.
71.14(3)
(3) Except as provided in
sub. (2) and
s. 71.04 (1) (b) 2., trusts created by contract, declaration of trust or implication of law that are made irrevocable and were administered in this state before October 29, 1999, shall be considered resident at the place where the trust is being administered. The following trusts shall be considered to be administered in the state of domicile of the corporate trustee of the trust at any time that the grantor of the trust is not a resident of this state:
71.14(3)(a)
(a) Trusts that have any assets invested in a common trust fund, as defined in section
584 of the internal revenue code, maintained by a bank or trust company domiciled in this state that is a member of the same affiliated group, as defined in section
1504 of the internal revenue code, as the corporate trustee.
71.14(3)(b)
(b) Trusts the assets of which in whole or in part are managed, or about which investment decisions are made, by a corporation domiciled in this state if that corporation and the corporate trustee are members of the same affiliated group, as defined in section
1504 of the internal revenue code.
71.14(3m)(a)(a) Subject to
par. (b) and except as provided in
sub. (2) and
s. 71.04 (1) (b) 2., only the following trusts, or portions of trusts, that become irrevocable on or after October 29, 1999, or that became irrevocable before October 29, 1999, and are first administered in this state on or after October 29, 1999, are resident of this state:
71.14(3m)(a)1.
1. Trusts, or portions of trusts, the assets of which consist of property placed in the trust by a person who is a resident of this state at the time that the property was placed in the trust if, at the time that the assets were placed in the trust, the trust was irrevocable.
71.14(3m)(a)2.
2. Trusts, or portions of trusts, the assets of which consist of property placed in the trust by a person who is a resident of this state at the time that the trust became irrevocable if, at the time that the property was placed in the trust, the trust was revocable.
71.14(3m)(b)1.
1. Is revocable if the person whose property constitutes the trust may revest title to the property in that person.
71.14(3m)(b)2.
2. Is irrevocable if the power to revest title, as described in
subd. 1., does not exist.
71.14(4)
(4) The unrelated business taxable income of trusts shall be apportioned under the department of revenue's rules.
71.15
71.15
Income computation. 71.15(1)
(1) The standard deduction shall not be allowed in computing the taxable income of an estate, a trust or a common trust fund.
71.15(2)
(2) A personal exemption for the decedent under
s. 71.07 (8) shall not be allowed the personal representative, except against the tax on income of the decedent in the year of death. If the decedent would have been entitled to an exemption for the decedent's spouse or a dependent under
s. 71.07 (8), had the decedent lived, the exemption shall be allowed to the personal representative so long as over one-half of the support of the spouse or dependent is supplied by the decedent or by the personal representative from the decedent's estate and the gross income of the spouse or dependent for the calendar year in which the taxable year of the personal representative begins is less than $500.
71.15 History
History: 1987 a. 312;
2001 a. 102.
71.16
71.16
Allocation of modifications. The Wisconsin modifications applicable to the Wisconsin taxable income or Wisconsin adjusted gross income of estates, trusts and beneficiaries thereof with respect to income derived from such estates or trusts shall be computed and allocated as follows:
71.16(1)
(1) A modification or portion thereof which relates to an item of income, gain, loss or deduction which affects the computation of the federal distributable net income of the estate or trust for the current year shall be apportioned among and taken into account by the fiduciary and the beneficiary or beneficiaries in the same proportion that the item to which it relates is considered as distributed among them for federal income tax purposes.
71.16(2)
(2) Any remaining modifications or portions thereof shall be taken into account by the fiduciary.
71.16(3)
(3) If an additional assessment is made against the fiduciary or any beneficiary as a result of correction of an erroneous allocation of the modifications applicable to the income of an estate or trust, any overpayment resulting from consistent application of such correction to all other taxpayers interested in such estate or trust shall be refunded notwithstanding any rule of law which would otherwise bar such refund.
71.16 History
History: 1987 a. 312.
71.17
71.17
General provisions. 71.17(1)
(1)
Assessment of trust income distributable to nonresident beneficiary. The income of a trust distributable or distributed to a nonresident beneficiary shall be assessed as the income of other nonresidents is assessed. No personal exemptions shall be allowed in assessing the income of such nonresident beneficiary unless that beneficiary makes a complete return under this chapter.
71.17(2)
(2) Lien on trust estate; income taxes levied against beneficiary. All income taxes levied against the income of beneficiaries shall be a lien on that portion of the trust estate or interest therein from which the income taxed is derived, and such taxes shall be paid by the fiduciary, if not paid by the distributee, before the same become delinquent. Every person who, as a fiduciary under the provisions of this subchapter, pays an income tax shall have all the rights and remedies of reimbursement for any taxes assessed against him or her or paid by him or her in such capacity, as provided in
s. 70.19 (1) and
(2).
71.17(3)
(3) Liability for payment of taxes due from decedent. Any income, withholding, sales, or use taxes, penalties, interest, and costs found to be due from a decedent, an estate, or a trust for any of the years open to assessment under
s. 71.77 and any delinquent income, withholding, sales, or use taxes, penalties, interest, and costs found to be due shall be assessed against and paid by one of the following:
71.17(3)(a)
(a) The personal representative or trustee.
71.17(3)(b)
(b) The beneficiaries, in the same ratio that their interest in the estate or trust bears to the total estate or trust, if found to be due after the personal representative or trustee is discharged.
71.17(4)
(4) Trusts established or maintained out-of-state; grantor liable for tax. The establishment or maintenance of a trust outside Wisconsin by a Wisconsin resident as grantor, the income from which trust is taxable to the grantor or to any person other than the trust under the internal revenue code, is hereby declared to be a tax avoidance device designed to avoid the legal application of the Wisconsin income tax to income properly taxable to the grantor or such other person. Any Wisconsin resident who is the grantor of such a trust shall be liable for the Wisconsin income tax on the income of such trust which is federally taxable to such grantor or other person under the internal revenue code.
71.17(5)
(5) Trusts that are exempt from federal income tax. Trusts exempt from federal income tax pursuant to subtitle A,
chapter 1, subchapter F of the internal revenue code shall to the same extent be exempt from taxation under this chapter.
71.17(6)
(6) Funeral trusts. If a qualified funeral trust makes the election under section
685 of the Internal Revenue Code for federal income tax purposes, that election applies for purposes of this chapter and each trust shall compute its own tax and shall apply the rates under
s. 71.06 (1),
(1m),
(1n),
(1p), or
(1q).
