71.775(2)(b)(b) A pass-through entity that is also a member of another pass-through entity is subject to withholding under this subsection and shall pay the tax based on the share of income that is distributable to each of the entity’s nonresident partners, members, shareholders, or beneficiaries. 71.775(3)(a)(a) A nonresident partner’s, member’s, shareholder’s, or beneficiary’s share of income from the pass-through entity that is attributable to this state shall not be included in determining the withholding under sub. (2) if any of the following applies: 71.775(3)(a)1.1. The partner, member, shareholder, or beneficiary is exempt from taxation under this chapter. For purposes of this subdivision, the pass-through entity may rely on a written statement from the partner, member, shareholder, or beneficiary claiming to be exempt from taxation under this chapter, if the pass-through entity attaches a copy of the statement to its return for the taxable year and if the statement specifies the name, address, federal employer identification number, and reason for claiming an exemption for each partner, member, shareholder, or beneficiary claiming to be exempt from taxation under this chapter. 71.775(3)(a)2.2. The partner’s, member’s, shareholder’s, or beneficiary’s share of income from the pass-through entity that is attributable to this state is less than $2,000. 71.775(3)(a)3.3. The nonresident partner, member, shareholder, or beneficiary files an affidavit with the department, in the form and manner prescribed by the department, whereby the nonresident partner, member, shareholder, or beneficiary agrees to file a Wisconsin income or franchise tax return and be subject to the personal jurisdiction of the department, the tax appeals commission, and the courts of this state for the purpose of determining and collecting Wisconsin income and franchise taxes, including estimated tax payments, together with any related interest and penalties. 71.775(3)(b)(b) A pass-through entity that is a joint venture is not subject to the withholding under sub. (2), if the pass-through entity has elected not to be treated as a partnership under section 761 of the Internal Revenue Code. 71.775(3)(cm)(cm) A pass-through entity that is a publicly traded partnership, as defined under section 7704 (b) of the Internal Revenue Code, that is treated as a partnership under the Internal Revenue Code is not subject to the withholding under sub. (2), if the entity files with the department an information return that reports the name, address, taxpayer identification number, and any other information requested by the department for each unit holder with an income in this state from the entity in excess of $500. 71.775(4)(a)(a) Each pass-through entity that is subject to the withholding under sub. (2) shall file an annual return that indicates the withholding amount paid to the state during the pass-through entity’s taxable year. The pass-through entity shall file the return with the department on or before the date on which the pass-through entity is required to file for federal income tax purposes, not including any extension, under the Internal Revenue Code. 71.775(4)(bm)1.1. For the return under par. (a), the department shall allow an automatic extension of 7 months or until the corresponding due date of the pass-through entity’s federal income tax return or return of partnership income, whichever is later. Except for payments of estimated taxes, and except as provided in subd. 2., withholding taxes payable upon filing the return are not delinquent during the extension period but shall be subject to interest at the rate of 12 percent per year during that period. 71.775(4)(bm)2.2. For taxable years beginning after December 31, 2008, for persons who qualify for a federal extension of time to file under 26 USC 7508A due to a presidentially declared disaster or terroristic or military action, withholding taxes that are otherwise due from a pass-through entity under sub. (2) are not subject to 12 percent interest as otherwise provided under subd. 1. during the extension period and for 30 days after the end of the federal extension period. 71.775(4)(bn)(bn) If a pass-through entity subject to withholding tax under sub. (2) does not file the return under par. (a) on or before the extension date provided in par. (bm), the pass-through entity is liable for the penalty provided in s. 71.83 (1), in addition to any unpaid tax, interest, and penalty otherwise assessable to a nonresident partner, member, shareholder, or beneficiary on income from the pass-through entity. 71.775(4)(cm)(cm) Except as provided in par. (L), pass-through entities shall make estimated payments of the withholding tax under sub. (2) in 4 installments, on or before the 15th day of each of the following months: 71.775(4)(dm)(dm) Section 71.29 (3), (3m), (4), (5), (6), and (11), as it applies to estimated payments of income and franchise taxes for corporations, also applies to estimated payments of the withholding tax imposed under sub. (2) for pass-through entities. 71.775(4)(em)(em) Except as provided in par. (fm), in the case of any underpayment of estimated withholding taxes under par. (cm), interest shall be added to the aggregate withholding tax for the taxable year at the rate of 12 percent per year on the amount of the underpayment for the period of the underpayment. In this paragraph, “period of the underpayment” means the time period beginning with the due date of the installment and ending on either the unextended due date of the return under par. (a) or the date of payment, whichever is earlier. If 90 percent of the tax due under sub. (2) for the taxable year is not paid by the unextended due date of the return under par. (a), the difference between that amount and the estimated taxes paid, along with any interest due, shall accrue delinquent interest in the same manner as income and franchise taxes under s. 71.82 (2) (a). 71.775(4)(fm)(fm) No interest is required under par. (em) for a pass-through entity if any of the following conditions apply: 71.775(4)(fm)2.2. The amount of withholding tax due under sub. (2) is less than $5,000, the pass-through entity had no withholding tax liability under sub. (2) for the preceding taxable year, and the preceding taxable year was 12 months. 71.775(4)(fm)3.3. The secretary of revenue determines that because of casualty, disaster, or other unusual circumstances it is not equitable to impose interest. 71.775(4)(g)(g) Except as provided under par. (h), the amount of each installment required under par. (cm) is 25 percent of the lesser of the following amounts: 71.775(4)(g)1.1. Ninety percent of the withholding tax under sub. (2) that is due for the taxable year. 71.775(4)(g)2.2. The withholding tax due under sub. (2) for the preceding taxable year, except that this subdivision does not apply if the preceding taxable year was less than 12 months or if the pass-through entity did not file a return under par. (a) for the preceding taxable year. 71.775(4)(h)(h) If 22.5 percent for the first installment, 45 percent for the 2nd installment, 67.5 percent for the 3rd installment, and 90 percent for the 4th installment of the tax due under sub. (2) for the taxable year; computed by annualizing, under methods prescribed by the department, the pass-through entity’s income for the months in the taxable year ending before the installment’s due date; is less than the installment required under par. (g), the pass-through entity may pay the amount under this paragraph, rather than the amount under par. (g). For purposes of computing annualized income under this paragraph, the apportionment percentage computed under s. 71.25 (6), (10), and (12) from the return under par. (a) filed for the previous taxable year may be used if that return was filed with the department on or before the due date of the installment for which the income is being annualized and if the apportionment percentage on that previous year’s return was greater than zero. Any pass-through entity that pays an amount calculated under this paragraph shall increase the next installment computed under par. (g) by an amount equal to the difference between the amount paid under this paragraph and the amount that would have been paid under par. (g). 71.775(4)(i)(i) On or before the due date, including extensions, of the entity’s return, a pass-through entity that withholds tax under sub. (2) shall annually notify each of its nonresident partners, members, shareholders, or beneficiaries of the amount of the tax withheld under sub. (2) that the pass-through entity paid on the nonresident partner’s, member’s, shareholder’s, or beneficiary’s behalf. The pass-through entity shall provide a copy of the notice to the department with the return that it files for the taxable year. 71.775(4)(j)(j) A nonresident partner, member, shareholder, or beneficiary of a pass-through entity may claim a credit, as prescribed by the department, on his or her Wisconsin income or franchise tax return for the amount withheld under sub. (2) on his or her behalf for the tax period for which the income of the pass-through entity is reported. 71.775(4)(k)(k) Any tax withheld under this section shall be held in trust for this state, and a pass-through entity subject to withholding under this section shall be liable to the department for the payment of the tax withheld. No partner, member, shareholder, or beneficiary of a pass-through entity shall have any right of action against the pass-through entity with respect to any amount withheld and paid in compliance with this section. 71.775(4)(L)(L) The department shall deem timely paid the estimated payments of the withholding tax imposed under sub. (2) that become due during the period beginning on January 1, 2009, and ending on July 1, 2009, provided that such estimated tax payments are paid by the next installment due date that follows in sequence following July 1, 2009. However, if the next installment due date following July 1, 2009, is less than 45 days after July 1, 2009, such estimated payments, in addition to the payment due less than 45 days after July 1, 2009, shall be deemed timely paid if paid by the next subsequent installment due date. 71.7871.78 Confidentiality provisions. 71.78(1)(1) Divulging information. Except as provided in subs. (1g), (4), (4m), (10), and (11), no person may divulge or circulate or offer to obtain, divulge, or circulate any information derived from an income, franchise, withholding, fiduciary, partnership, or limited liability company tax return or tax credit claim, including information which may be furnished by the department as provided in this section. This subsection does not prohibit publication by any newspaper of information lawfully derived from such returns or claims for purposes of argument or prohibit any public speaker from referring to such information in any address. This subsection does not prohibit the department from publishing statistics classified so as not to disclose the identity of particular returns, or claims or reports and the items thereof. This subsection does not prohibit employees or agents of the department of revenue from offering or submitting any return, including joint returns of a spouse or former spouse, separate returns of a spouse, individual returns of a spouse or former spouse, and combined individual income tax returns, or from offering or submitting any claim, schedule, exhibit, writing, or audit report or a copy of, and any information derived from, any of those documents as evidence into the record of any contested matter involving the department in proceedings or litigation on state tax matters if, in the department’s judgment, that evidence has reasonable probative value. 71.78(1g)(1g) Permissible disclosure by department employees. An employee of the department may, in connection with the employee’s official duties, disclose information derived from a return or claim specified in sub. (1) to the extent that the disclosure is necessary to obtain information for the enforcement of the tax laws of this state. The information that may be disclosed under this subsection shall be strictly limited to, and used solely for the purposes of, obtaining information necessary for an audit, collection, inspection, or investigation by the employee. 71.78(1m)(a)(a) No person, except the person who filed the return or claim, may inspect a return or claim, or any information derived from a return or claim, that is filed under this chapter unless that person does so in performing the duties of his or her position. Violation of this paragraph by a state employee is grounds for dismissal. 71.78(1m)(b)(b) If any person is charged with a violation of par. (a), the secretary of revenue shall notify each taxpayer whose return or claim was improperly inspected by that person. 71.78(1m)(c)(c) Any person who is notified under par. (b) may bring an action for damages in regard to the inspection. 71.78(2)(2) Disclosure of net tax. The department shall make available upon suitable forms prepared by the department information setting forth the net Wisconsin income tax or Wisconsin franchise tax reported as paid or payable in the returns filed by any individual or corporation, and any amount of delinquent taxes owed by any such individual or corporation, for any individual year upon request. When making available information setting forth the delinquent taxes owed by an individual or corporation, the information shall include interest, penalties, fees, and costs, which are unpaid for more than 90 days after all appeal rights have expired, except that such information may not be provided for any person who has reached an agreement or compromise with the department, or the department of justice, under s. 71.92 and is in compliance with that agreement, regarding the payment of delinquent taxes, or the name of any person who is protected by a stay that is in effect under the Federal Bankruptcy Code. Before the request is granted, the person desiring to obtain the information shall prove his or her identity and shall be required to sign a statement setting forth the person’s address and reason for making the request and indicating that the person understands the provisions of this section with respect to the divulgement, publication, or dissemination of information obtained from returns as provided in sub. (1). The use of a fictitious name is a violation of this section. Within 24 hours after any information from any such tax return has been so obtained, the department shall mail to the person from whose return the information has been obtained a notification which shall give the name and address of the person obtaining the information and the reason assigned for requesting the information. The department shall collect from the person requesting the information a fee of $4 for each return. 71.78(3)(3) Disclosure limitation. The information described in sub. (2) shall not be made available to any nonresident or to any resident who is making the request for such information for the use or benefit, directly or indirectly, of a nonresident person or firm or a foreign corporation except to the extent that similar information in the state of residence of such person or firm or the state of incorporation of such foreign corporation is made available to residents of Wisconsin or Wisconsin corporations. As part of the statement required by sub. (2), the department shall require any person desiring to obtain such information to declare whether the person is a nonresident of the state and whether the information is desired for the use or benefit of a nonresident person or firm or a foreign corporation. No copy of any return shall be supplied to any person except as permitted by sub. (4). 71.78(4)(4) Persons qualified to examine returns for specified purposes. Subject to subs. (5) and (6) and to rules of the department, any returns or claims specified under sub. (1) or any schedules, exhibits, writings or audit reports pertaining to the returns or claims on file with the department shall be open to examination by only the following persons and the contents thereof may be divulged or used only as follows: 71.78(4)(a)(a) The secretary of revenue or any officer, agent or employee of the department. 71.78(4)(b)(b) The attorney general and department of justice employees. A department of justice employee may, in connection with the employee’s official duties, disclose information, other than copies of information, examined under this paragraph to a law enforcement investigator participating in a department of justice investigation of suspected criminal conduct. The information that may be disclosed under this paragraph shall be strictly limited to, and used solely for the purposes of, obtaining information necessary for a department of justice investigation. 71.78(4)(c)(c) Members of any legislative committee on organization or its authorized agents provided the examination is approved by a majority vote of a quorum of its members and the tax return or claim information is disclosed only in a meeting closed to the public. The committee may disclose tax return or claim information to the senate or assembly or to other legislative committees if the information does not disclose the identity of particular returns, claims or reports and the items thereof. The department of revenue shall provide assistance to the committees or their authorized agents in order to identify returns and claims deemed necessary by them to accomplish the review and analysis of tax policy. 71.78(4)(d)(d) Public officers of the federal government or other state governments or the authorized agents of such officers, where necessary in the administration of the tax laws of such governments, to the extent that such government accords similar rights of examination or information to officials of this state. 71.78(4)(e)(e) The person who filed or submitted the return or claim, or to whom the return or claim relates or by the person’s authorized agent or attorney. 71.78(4)(f)(f) Any person examining a return or claim pursuant to a court order duly obtained upon a showing to the court that the information contained in the return or claim is relevant to a pending court action or pursuant to a subpoena signed by a judge of a court of record ordering the department’s custodian of returns or claims to produce a return or claim in open court in a court action pending before the judge. 71.78(4)(g)(g) Employees of this state, to the extent that the department of revenue deems the examination necessary for the employees to perform their duties under contracts or agreements between the department and any other department, division, bureau, board or commission of this state relating to the administration of tax laws or child and spousal support enforcement under s. 49.22. 71.78(4)(h)1.1. A member of the board of arbitration established under s. 71.10 (7) or a consultant under joint contract with the states of Minnesota and Wisconsin for the purpose of determining the reciprocity loss to which either state is entitled. 71.78(4)(h)2.2. A member of the board of arbitration established under s. 71.10 (7e) or a consultant under joint contract with the states of Illinois and Wisconsin for the purpose of determining the reciprocity loss to which either state is entitled. 71.78(4)(j)(j) Employees of the legislative fiscal bureau to the extent that the department of revenue deems the examination necessary for those employees to perform their duties under contracts or agreements between the department and the bureau relating to the review and analysis of tax policy and the analysis of state revenue collections. 71.78(4)(k)(k) The spouse or former spouse of the person who filed the return or claim if the spouse or former spouse may be liable, or the property of the spouse or former spouse is subject to collection, for the delinquency, or the department has issued an assessment or denial of a claim to the spouse or former spouse regarding the return or claim. 71.78(4)(L)(L) The administrator of the lottery division in the department for the purpose of withholding lottery winnings under s. 565.30 (5). 71.78(4)(m)(m) The chief executive officer of the Wisconsin Economic Development Corporation and employees of the corporation to the extent necessary to administer the tax benefit programs under ch. 238, including review of tax benefit applications, compliance with tax benefit certifications, and confirming the amount of tax benefits used for purposes of revoking tax benefits. 71.78(4)(o)(o) A licensing department or the supreme court, if the supreme court agrees, for the purpose of denial, nonrenewal, discontinuation and revocation of a license based on tax delinquency under s. 73.0301. 71.78(4)(p)(p) The secretary of revenue and employees of that department for the purpose of calculating the penalty under s. 71.83 (1) (d). 71.78(4)(q)(q) Employees of the department of corrections involved in the administration of the sex offender registry under s. 301.45, for the purpose of verifying information provided by a person required to register as a sex offender. 71.78(4)(r)(r) The secretary of revenue and employees of that department for the purpose of preparing and maintaining the list of persons with unpaid tax obligations as described in s. 73.03 (62) so that the list of such persons is available for public inspection. 71.78(4)(s)(s) The state auditor and the employees of the legislative audit bureau to the extent necessary for the bureau to carry out its duties under s. 13.94. 71.78(4)(t)(t) For purposes of obtaining the outstanding liability secured by a tax warrant, any person, or authorized agent of any person, who provides satisfactory evidence to the department, as determined by the department, that the person has a material interest, or intends to obtain a material interest, in a property that is subject to a tax warrant filed by the department under s. 71.91 (5). 71.78(4)(u)(u) The department of safety and professional services for the purpose of reducing an initial credential fee under s. 440.052. 71.78(4)(v)(v) A federal grand jury or grand jury of this state, upon receipt by the department of a grand jury subpoena. 71.78(4m)(4m) Disclosure of certain dates to spouses and former spouses. The department may disclose to the spouse or former spouse of the person who filed a return or claim specified under sub. (1) whether an extension for filing the return or claim was obtained, the extended due date for filing the return or claim and the date on which the return or claim was filed with the department. 71.78(5)(5) Agreement with department. Copies of returns and claims specified in sub. (1) and related schedules, exhibits, writings or audit reports shall not be furnished to the persons listed under sub. (4), except persons under sub. (4) (e), (k), (m), (n), (o), (q), and (v) or under an agreement between the department of revenue and another agency of government. 71.78(6)(6) Restriction on use of information. The use of information obtained under sub. (4) or (5) is restricted to the discharge of duties imposed upon the persons by law or by the duties of their office or by order of a court as provided under sub. (4) (f) or (v). 71.78(7)(7) Charge for costs. The department of revenue may charge for the reasonable cost of divulging information under this section. 71.78(8)(8) District attorneys. District attorneys may examine tax and claim information of persons on file with the department of revenue as follows: 71.78(8)(a)(a) Such information may be examined for use in preparation for any judicial proceeding or any investigation which may result in a judicial proceeding involving any of the taxes or tax credits specified in sub. (1) if: 71.78(8)(a)1.1. The taxpayer is or may be a party to such proceeding; 71.78(8)(a)2.2. The treatment of an item reflected in such information is or may be related to the resolution of an issue in the proceeding or investigation; or 71.78(8)(a)3.3. The information relates or may relate to a transactional relationship between the taxpayer or credit claimant and a person who is or may be a party to the proceeding which affects or may affect the resolution of an issue in such proceeding or investigation. 71.78(8)(b)(b) When the department of revenue allows examination of information under par. (a): 71.78(8)(b)1.1. If the department has referred the case to a district attorney, the department may make disclosure on its own motion. 71.78(8)(b)2.2. If a district attorney requests examination of tax or tax credit information relating to a person, the request must be in writing, clearly identify the requester and the person to whom the information relates and explain the need for the information. The department may then allow the examination of information so requested and the information may be examined and used solely for the proceeding or investigation for which it was requested. 71.78(8)(c)(c) Such information may be examined for use in preparation for any administrative or judicial proceeding or an investigation which may result in such proceeding pertaining to the enforcement of a specifically designated state criminal statute not involving tax administration to which this state or a governmental subdivision thereof is a party. Such information may be used solely for the proceeding or investigation for which it is requested. 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(11)(11) Pass-through entity audits. If the department audits a pass-through entity for income or franchise taxes of its pass-through members, including when an election is made under s. 71.21 (6) (a) or 71.365 (4m) (a) to pay tax at the entity level, the department may disclose the following:
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Chs. 70-79, Taxation
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