71.39(1)(a)
(a) United States income, excess or war profits and defense taxes shall be allowed as a deduction from gross income to the extent of the total payment actually made during the tax year.
71.39(1)(b)
(b) A deduction shall be allowed from such taxable income before the imposition of the special tax levied by this section, in an amount equivalent to 8 percent of the amount by which the cost of the property of such corporation used and useful in providing its urban mass transportation of passengers exceeds the cumulated amount of the depreciation accrued against such property as of the end of the fiscal year for which the income or franchise tax return is filed.
71.39(1)(c)
(c) An amount shall be added to such taxable income, before imposition of the special tax levied by this section, which amount shall be equivalent to the interest paid during the year in the operation of the business from which its income is derived.
71.39(2)
(2)
Determination of net business loss. The addition to and deductions from income of urban transit companies under sub.
(1) shall be used in determining the Wisconsin net business loss of such companies to be offset against the Wisconsin net business income as determined under this section for purposes of s.
71.26 (4).
71.39 History
History: 1987 a. 312;
1991 a. 39.
71.40
71.40
Filing of returns. The special income tax assessed under this subchapter shall be reported in an income or franchise tax return filed in accordance with this chapter, except as modified by this subchapter. The tax so reported and assessed shall be payable to the department of revenue.
71.40 History
History: 1987 a. 312;
1991 a. 39.
TAXATION OF INSURANCE COMPANIES
71.42
71.42
Definitions. In this subchapter:
71.42(1b)
(1b) “Aggregate effective tax rate" means the sum of the effective tax rates imposed by a state, U.S. possession, foreign country, or any combination thereof, on the person or entity.
71.42(1g)
(1g) “Corporation" means insurance corporations, insurance joint stock companies, insurance associations and insurance common law trusts, unless the context requires otherwise.
71.42(1m)
(1m) “Department" means the department of revenue.
71.42(1s)
(1s) “Effective tax rate" means the maximum tax rate imposed by the state, U.S. possession, or foreign country, multiplied by the apportionment percentage, if any, applicable to the person or entity under the laws of that state, U.S. possession, or foreign country.
71.42(1sg)
(1sg) For purposes of ss.
71.45 (2) (a) 16. and
18. and
71.255 (2) (d) 1., “intangible expenses" include the following, to the extent that the amounts would otherwise be deductible in computing net income under the Internal Revenue Code, as adjusted under s.
71.45 (2):
71.42(1sg)(a)
(a) Expenses, losses, and costs for, related to, or directly or indirectly in connection with the acquisition, use, maintenance, management, ownership, sale, exchange, or any other disposition of intangible property.
71.42(1sg)(b)
(b) Losses related to, or incurred in connection directly or indirectly with, factoring transactions or discounting transactions.
71.42(1sg)(c)
(c) Royalty, patent, technical, and copyright fees.
71.42(1sh)
(1sh) “Intangible property" includes stocks, bonds, financial instruments, patents, patent applications, trade names, trademarks, service marks, copyrights, mask works, trade secrets, and similar types of intangible assets.
71.42(2)(j)1.1. For taxable years beginning after December 31, 2013, and before January 1, 2017, “Internal Revenue Code" means the federal Internal Revenue Code as amended to December 31, 2013, except as provided in subds.
2. to
4. and subject to subd.
5. 71.42(2)(j)2.
2. For purposes of this paragraph, “Internal Revenue Code" does not include the following provisions of federal public laws for taxable years beginning after December 31, 2013: section 13113 of P.L
103-66; sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422 of P.L
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59; section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
110-172; section 301 of P.L.
110-245; sections 15303 and 15351 of P.L.
110-246; section 302 of division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of division C of P.L.
110-343; sections 1232, 1241, 1251, 1501, and 1502 of division B of P.L.
111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; sections 2011 and 2122 of P.L.
111-240; sections 753, 754, and 760 of P.L.
111-312; section 1106 of P.L.
112-95; and sections 104, 318, 322, 323, 324, 326, 327, and 411 of P.L.
112-240.
71.42(2)(j)3.
3. For purposes of this paragraph, “Internal Revenue Code" does not include amendments to the federal Internal Revenue Code enacted after December 31, 2013, except that “Internal Revenue Code" includes the provisions of the following federal public laws:
71.42(2)(j)3.k.
k. Sections 103, 104, 124, 168, 184, 185, 190, 204, 303, 306, 336, and 341 of division Q of P.L.
114-113.
71.42(2)(j)3.n.
n. Section 102 of division M and sections 110, 111, and 116 (b) of division O of P.L.
116-94.
71.42(2)(j)4.
4. For purposes of this paragraph, “Internal Revenue Code" does not include section 847 of the federal Internal Revenue Code.
71.42(2)(j)5.
5. For purposes of this paragraph, the provisions of federal public laws that directly or indirectly affect the Internal Revenue Code, as defined in this paragraph, apply for Wisconsin purposes at the same time as for federal purposes.
71.42(2)(k)1.1. For taxable years beginning after December 31, 2016, and before January 1, 2018, “Internal Revenue Code" means the federal Internal Revenue Code as amended to December 31, 2016, except as provided in subds.
2. to
4. and s.
71.98 and subject to subd.
5. 71.42(2)(k)2.
2. For purposes of this paragraph, “Internal Revenue Code" does not include the following provisions of federal public laws for taxable years beginning after December 31, 2016: section 13113 of P.L
103-66; sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422 of P.L
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59; section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
110-172; section 301 of P.L.
110-245; section 15351 of P.L.
110-246; section 302 of division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of division C of P.L.
110-343; sections 1232, 1241, 1251, 1501, and 1502 of division B of P.L.
111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; sections 2011 and 2122 of P.L.
111-240; sections 753, 754, and 760 of P.L.
111-312; section 1106 of P.L.
112-95; sections 104, 318, 322, 323, 324, 326, 327, and 411 of P.L.
112-240; P.L.
114-7; section 1101 of P.L.
114-74; section 305 of division P of P.L.
114-113; and sections 112, 123, 125 to 128, 143, 144, 151 to 153, 165 to 167, 169 to 171, 189, 191, 307, 326, and 411 of division Q of P.L.
114-113.
71.42(2)(k)3.
3. For purposes of this paragraph, “Internal Revenue Code" does not include amendments to the federal Internal Revenue Code enacted after December 31, 2016, except that “Internal Revenue Code” includes sections 11024, 11025, and 13543 of P.L.
115-97; sections 40307 and 40413 of P.L.
115-123; sections 101 (m), (n), (o), (p), and (q), 104 (a), and 109 of division U of P.L.
115-141; and section 102 of division M and sections 110, 111, and 116 (b) of division O of P.L.
116-94.
71.42(2)(k)4.
4. For purposes of this paragraph, “Internal Revenue Code" does not include section 847 of the federal Internal Revenue Code.
71.42(2)(k)5.
5. For purposes of this paragraph, the provisions of federal public laws that directly or indirectly affect the Internal Revenue Code, as defined in this paragraph, apply for Wisconsin purposes at the same time as for federal purposes, except that changes made by section 4007 (b) of P.L.
114-41, section 1102 of P.L.
114-74, sections 105, 111, 113 to 115, 133, 301, 302, 304, 305, 308, 311, 313 to 323, 325, 331, and 343 to 345 of division Q of P.L.
114-113 first apply for taxable years beginning after December 31, 2016.
71.42(2)(L)1.1. For taxable years beginning after December 31, 2017, and before January 1, 2021, “Internal Revenue Code" means the federal Internal Revenue Code as amended to December 31, 2017, except as provided in subds.
2. to
4. and s.
71.98 and subject to subd.
5. 71.42(2)(L)2.
2. For purposes of this paragraph, “Internal Revenue Code" does not include the following provisions of federal public laws for taxable years beginning after December 31, 2017: section 13113 of P.L.
103-66; sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422 of P.L.
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59; section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
110-172; section 301 of P.L.
110-245; section 15351 of P.L.
110-246; section 302 of division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of division C of P.L.
110-343; sections 1232, 1241, 1251, 1501, and 1502 of division B of P.L.
111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; sections 2011 and 2122 of P.L.
111-240; sections 753, 754, and 760 of P.L.
111-312; section 1106 of P.L.
112-95; sections 104, 318, 322, 323, 324, 326, 327, and 411 of P.L.
112-240; P.L.
114-7; section 1101 of P.L.
114-74; section 305 of division P of P.L.
114-113; sections 123, 125 to 128, 143, 144, 151 to 153, 165 to 167, 169 to 171, 189, 191, 307, 326, and 411 of division Q of P.L.
114-113; and sections 11011, 11012, 13201 (a) to (e) and (g), 13206, 13221, 13301, 13304 (a), (b), and (d), 13531, 13601, 13801, 14101, 14102, 14103, 14201, 14202, 14211, 14212, 14213, 14214, 14215, 14221, 14222, 14301, 14302, 14304, and 14401 of P.L.
115-97.
71.42(2)(L)3.
3. For purposes of this paragraph, “Internal Revenue Code" does not include amendments to the federal Internal Revenue Code enacted after December 31, 2017, except that “Internal Revenue Code” includes sections 40307, 40413, and 41113 of P.L.
115-123; sections 101 (m), (n), (o), (p), and (q), 104 (a), 109, 401 (a) (54) and (b) (15) (A), (B), and (C), 19, 20, 23, 26, 27, and 28 of division U of P.L.
115-141; sections 102 and 104 of division M, sections 102, 103, 106, 107, 108, 109, 110, 111, 113, 114, 115, 116, 201, 204, 205, 206, 302, 401, and 601 of division O, section 1302 of division P, and sections 131, 202 (d), and 205 of division Q of P.L.
116-94; sections 1106, 2202, 2203, 2204, 2205, 2206, 2307, 3608, 3609, 3701, and 3702 of division A of P.L.
116-136; and sections 202, 208, 209, 211, and 214 of division EE and sections 276 (a) and (b), 277, 278 (a), (b), (c), and (d), 280, and 285 of division N of P.L.
116-260.
71.42(2)(L)4.
4. For purposes of this paragraph, “Internal Revenue Code" does not include section 847 of the federal Internal Revenue Code.
71.42(2)(L)5.
5. For purposes of this paragraph, the provisions of federal public laws that directly or indirectly affect the Internal Revenue Code, as defined in this paragraph, apply for Wisconsin purposes at the same time as for federal purposes, except that changes made by P.L.
115-63 and sections 11026, 11027, 11028, 13207, 13306, 13307, 13308, 13311, 13312, 13501, 13705, 13821, and 13823 of P.L.
115-97 first apply for taxable years beginning after December 31, 2017.
71.42(2)(m)1.1. For taxable years beginning after December 31, 2020, “Internal Revenue Code" means the federal Internal Revenue Code as amended to December 31, 2020, except as provided in subds.
2. and
3. and s.
71.98 and subject to subd.
4. 71.42(2)(m)2.
2. For purposes of this paragraph, “Internal Revenue Code" does not include the following provisions of federal public laws for taxable years beginning after December 31, 2020: section 13113 of P.L.
103-66; sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422 of P.L.
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59; section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
110-172; section 301 of P.L.
110-245; section 15351 of P.L.
110-246; section 302 of division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of division C of P.L.
110-343; sections 1232, 1241, 1251, 1501, and 1502 of division B of P.L.
111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; sections 2011 and 2122 of P.L.
111-240; sections 753, 754, and 760 of P.L.
111-312; section 1106 of P.L.
112-95; sections 104, 318, 322, 323, 324, 326, 327, and 411 of P.L.
112-240; P.L.
114-7; section 1101 of P.L.
114-74; section 305 of division P of P.L.
114-113; sections 123, 125 to 128, 143, 144, 151 to 153, 165 to 167, 169 to 171, 189, 191, 307, 326, and 411 of division Q of P.L.
114-113; sections 11011, 11012, 13201 (a) to (e) and (g), 13206, 13221, 13301, 13304 (a), (b), and (d), 13531, 13601, 13801, 14101, 14102, 14103, 14201, 14202, 14211, 14212, 14213, 14214, 14215, 14221, 14222, 14301, 14302, 14304, and 14401 of P.L.
115-97; sections 40304, 40305, 40306, and 40412 of P.L.
115-123; section 101 (c) of division T of P.L.
115-141; sections 101 (d) and (e), 102, 201 to 207, 301, 302, and 401 (a) (47) and (195), (b) (13), (17), (22) and (30), and (d) (1) (D) (v), (vi), and (xiii) and (xvii) (II) of division U of P.L.
115-141; sections 104, 114, 115, 116, 130, and 145 of division Q of P.L.
116-94; sections 2304 and 2306 of P.L.116-136; and sections 111, 114, 115, 116, 118 (a) and (d), 133, 137, 138, and 210 of division EE of P.L.
116-260.
71.42(2)(m)3.
3. For purposes of this paragraph, “Internal Revenue Code" does not include amendments to the federal Internal Revenue Code enacted after December 31, 2020.
71.42(2)(m)4.
4. For purposes of this paragraph, the provisions of federal public laws that directly or indirectly affect the Internal Revenue Code, as defined in this paragraph, apply for Wisconsin purposes at the same time as for federal purposes, except that changes made by sections 20101, 20102, 20104, 20201, 40201, 40202, 40203, 40308, 40309, 40311, 40414, 41101, 41107, 41114, 41115, and 41116 of P.L.
115-123; section 101 (a), (b), and (h) of division U of P.L.
115-141; section 1203 of 116-25; section 1122 of P.L.
116-92; section 301 of division O, section 1302 of division P, and sections 101, 102, 103, 117, 118, 132, 201, 202 (a), (b), and (c), 204 (a), (b), and (c), 301, and 302 of division Q of P.L.
116-94; section 2 of P.L.
116-98; and sections 301, 302, and 304 of division EE of P.L.
116-260 apply for taxable years beginning after December 31, 2020.
71.42(2m)
(2m) Notwithstanding sub.
(2), a qualified retirement fund for a taxable year for federal income tax purposes is a qualified retirement fund for the taxable year for purposes of this subchapter.
71.42(2s)
(2s) “Last day prescribed by law" has the meaning given in s.
71.738.
71.42(3)
(3) “Life insurance" includes annuities.
71.42(3c)
(3c) For purposes of s.
71.45 (2) (a) 16. and
18., “management fees" include expenses and costs, not including interest expenses, pertaining to accounts receivable, accounts payable, employee benefit plans, insurance, legal matters, payroll, data processing, purchasing, taxation, financial matters, securities, accounting, or reporting and compliance matters or similar activities, to the extent that the amounts would otherwise be deductible in determining net income under the Internal Revenue Code as adjusted under s.
71.45 (2).
71.42(3d)
(3d) “Member" does not include a member of a limited liability company treated as a corporation under s.
71.22 (1k).
71.42(3h)
(3h) “Partner" does not include a partner of a publicly traded partnership treated as a corporation under s.
71.22 (1k).
71.42(3m)
(3m) “Pay" means mail or deliver funds to the department or, if the department prescribes another method of payment or another destination, use that other method or submit to that other destination.
71.42(4)
(4) “Person" includes corporations, unless the context requires otherwise.
71.42(4m)
(4m) “Related entity" means any person related to a taxpayer as provided under section
267 or
1563 of the Internal Revenue Code during all or a portion of the taxpayer's taxable year and any real estate investment trust under section
856 of the Internal Revenue Code, except a qualified real estate investment trust, if more than 50 percent of any class of the beneficial interests or shares of the real estate investment trust are owned directly, indirectly, or constructively by the taxpayer, or any person related to the taxpayer, during all or a portion of the taxpayer's taxable year. For purposes of this subsection, the constructive ownership rules of section
318 (a) of the Internal Revenue Code, as modified by section
856 (d) (5) of the Internal Revenue Code, shall apply in determining the ownership of stock, assets, or net profits of any person.
71.42(4n)
(4n) For purposes of s.
71.45 (2) (a) 16. and
18., “rental expenses" means the gross amounts that would otherwise be deductible under the Internal Revenue Code, as adjusted under s.
71.45 (2), for the use of, or the right to use, real property and tangible personal property in connection with real property, including services furnished or rendered in connection with such property, regardless of how reported for financial accounting purposes and regardless of how computed.
71.42 History
History: 1987 a. 312;
1987 a. 411 ss.
5,
148,
149;
1989 a. 31,
336;
1991 a. 39,
269;
1993 a. 16,
437;
1995 a. 27,
380,
428;
1997 a. 27,
37,
237;
1999 a. 9,
194;
2001 a. 16,
109;
2003 a. 33;
2005 a. 25,
49;
2007 a. 20,
226;
2009 a. 2,
28,
161,
183;
2011 a. 32;
2013 a. 20;
2015 a. 55,
216;
2017 a. 59,
231;
2019 a. 185;
2021 a. 1.
71.43
71.43
Imposition of tax. 71.43(1)(1)
Income tax. For the purpose of raising revenue for the state and the counties, cities, villages and towns, there shall be assessed, levied, collected and paid a tax as provided under this chapter on all Wisconsin net incomes of corporations that are not subject to the franchise tax under sub.
(2) and that own property within this state; that derive income from sources within this state or from activities that are attributable to this state; or whose business within this state during the taxable year, except as provided under s.
71.23 (3), consists exclusively of foreign commerce, interstate commerce, or both, or that buy or sell lottery prizes if the winning tickets were originally bought in this state; except as exempted under ss.
71.26 (1) and
71.45 (1) (a). This section shall not be construed to prevent or affect the correction of errors or omissions in the assessments of income for former years under s.
71.74 (1) and
(2).
71.43(2)
(2)
Franchise tax on corporations. For the privilege of exercising its franchise, buying or selling lottery prizes if the winning tickets were originally bought in this state or doing business in this state in a corporate capacity, except as provided under s.
71.23 (3), every domestic or foreign corporation, except corporations specified in ss.
71.26 (1) and
71.45 (1) (a), shall annually pay a franchise tax according to or measured by its entire Wisconsin net income of the preceding taxable year at the rates set forth in s.
71.46 (2). In addition, except as provided in ss.
71.23 (3),
71.26 (1) and
71.45 (1) (a), a corporation that ceases doing business in this state shall pay a special franchise tax according to or measured by its entire Wisconsin net income for the taxable year during which the corporation ceases doing business in this state at the rate under s.
71.46 (2). Every corporation organized under the laws of this state shall be deemed to be residing within this state for the purposes of this franchise tax. All provisions of this chapter and ch.
73 relating to income taxation of corporations shall apply to franchise taxes imposed under this subsection, unless the context requires otherwise. The tax imposed by this subsection on insurance companies subject to taxation under this chapter shall be based on Wisconsin net income computed under s.
71.45, and no other provision of this chapter relating to computation of taxable income for other corporations shall apply to such insurance companies, except for s.
71.255. All other provisions of this chapter shall apply to insurance companies subject to taxation under this chapter unless the context clearly requires otherwise.
71.43 Annotation
Sub. (2) is discriminatory within the meaning of 31 USC 3124 (1) (a) and in violation of that provision. American Family Mutual Insurance Co. v. DOR,
214 Wis. 2d 577,
571 N.W.2d 710 (Ct. App. 1997),
97-1105.
71.44
71.44
Filing returns; extensions; payment of tax. 71.44(1)(a)(a) Every corporation, except a corporation all of whose income is exempt from taxation and except as provided in sub.
(1m), shall furnish to the department a true and accurate statement, on or before the date on which the corporation is required to file for federal income tax purposes, not including any extension, under the Internal Revenue Code, in the manner and form and setting forth the facts the department deems necessary to enforce this chapter. Every corporation that is required to furnish a statement under this paragraph and that has income that is not taxable under this subchapter shall include with the corporation's statement a report that identifies each item of the corporation's nontaxable income. The statement shall be subscribed by the president, vice president, treasurer, assistant treasurer, chief accounting officer, or any other officer duly authorized so to act. In the case of a return made for a corporation by a fiduciary, the fiduciary shall subscribe the return. The fact that an individual's name is subscribed on the return shall be prima facie evidence that the individual is authorized to subscribe the return on behalf of the corporation.
71.44 Cross-reference
Cross-reference: See also s.
Tax 2.09, Wis. adm. code.
71.44(1)(b)
(b) Each corporation that is required to file a return under this section shall file with that return a copy of its federal income tax return for the same taxable year.
71.44(1)(c)
(c) Whenever a corporation has been completely inactive for an entire taxable year, in lieu of filing the statements and information otherwise required by this section, it may file a declaration, on a form to be provided by the department, subscribed by its president, if a resident of this state, and, if not a resident, then by another officer residing in this state, attesting to such inactivity. Such declaration must be filed prior to the otherwise due date for its Wisconsin return for such taxable year. Thereafter the corporation need not file such statements or information for any subsequent year unless specifically requested to do so by the department or unless in a subsequent year the corporation has been activated or reactivated. If a corporation files a false declaration of complete inactivity, or, after filing a declaration, becomes activated or reactivated and fails to file timely statements and information hereunder covering such year or years of activity or reactivity its officers at the time of such filing or failure shall be jointly and severally liable for a civil penalty of $25 for such filing or each such failure, which penalty may be assessed and collected as income or franchise taxes are assessed and collected.
71.44(1)(d)
(d) Nothing contained in this subsection shall preclude the department from requiring any corporation to file a return when in the judgment of the department a return should be filed.
71.44(1m)
(1m)
Unrelated business income. Every corporation subject to a tax on unrelated business income under s.
71.26 (1) (a), if that corporation is required to file for federal income tax purposes, shall furnish to the department a true and accurate statement on or before the date on which the corporation is required to file for federal income tax purposes, not including any extension, under the Internal Revenue Code. The requirements about manner, form, and subscription under sub.
(1) apply to statements under this subsection.
71.44(2)
(2)
Changing accounting periods. 71.44(2)(a)
(a) Corporations may not change their basis of reporting from a calendar year to a fiscal year, from a fiscal year to a calendar year, or from one fiscal year to another without first obtaining the approval of the department of revenue unless the internal revenue service has approved the change or unless the change, including a change to a short taxable year, is required by the internal revenue code before approval by the internal revenue service and the reason for the change is explained in the first return filed for the new taxable year. Corporations that make changes on the basis of federal changes shall submit a copy of the internal revenue service's notice of approval, if prior federal approval, other than expeditious approval, was required, or requirement, if prior federal approval was not required or if the corporation qualifies for expeditious approval, to the department of revenue along with the return for the first taxable year for which the change applies.
