LRB-4108/1
JK:cdc&amn
2023 - 2024 LEGISLATURE
September 6, 2023 - Introduced by Representative Katsma, cosponsored by Senator
Marklein. Referred to Committee on Ways and Means. Referred to Joint
Survey Committee on Tax Exemptions.
AB406,1,6
1An Act to renumber and amend 71.98 (5);
to amend 71.01 (6) (m) 1., 71.22 (4)
2(m) 1., 71.22 (4m) (m) 1., 71.34 (1g) (m) 1. and 71.42 (2) (m) 1.; and
to create
371.01 (6) (n), 71.01 (6) (o), 71.22 (4) (n), 71.22 (4) (o), 71.22 (4m) (n), 71.22 (4m)
4(o), 71.34 (1g) (n), 71.34 (1g) (o), 71.42 (2) (n), 71.42 (2) (o) and 71.98 (5) (b) of
5the statutes;
relating to: adopting changes to the federal Internal Revenue
6Code for state tax purposes.
Analysis by the Legislative Reference Bureau
This bill adopts, for state income and franchise tax purposes, certain changes
made to the Internal Revenue Code by the following federal acts:
1. The American Rescue Plan Act of 2021.
2. The Infrastructure Investment and Jobs Act.
3. The Consolidated Appropriations Act of 2022.
4. The Inflation Reduction Act of 2022.
5. The Consolidated Appropriations Act of 2023.
The bill also updates the reference to the federal Internal Revenue Code
regarding the exclusion for gain from certain small business stock so that the
exclusion allowed under state law is always in compliance with the exclusion under
federal law.
Because this bill relates to an exemption from state or local taxes, it may be
referred to the Joint Survey Committee on Tax Exemptions for a report to be printed
as an appendix to the bill.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB406,1
1Section
1. 71.01 (6) (m) 1. of the statutes is amended to read:
AB406,2,62
71.01
(6) (m) 1. For taxable years beginning after December 31, 2020,
and
3before January 1, 2022, for individuals and fiduciaries, except fiduciaries of nuclear
4decommissioning trust or reserve funds, “Internal Revenue Code” means the federal
5Internal Revenue Code as amended to December 31, 2020, except as provided in
6subds. 2. and 3. and s. 71.98 and subject to subd. 4.
AB406,2
7Section
2. 71.01 (6) (n) of the statutes is created to read:
AB406,2,128
71.01
(6) (n) 1. For taxable years beginning after December 31, 2021, and before
9January 1, 2023, for individuals and fiduciaries, except fiduciaries of nuclear
10decommissioning trust or reserve funds, “Internal Revenue Code” means the federal
11Internal Revenue Code as amended to December 31, 2021, except as provided in
12subds. 2. and 3. and s. 71.98 and subject to subd. 4.
AB406,3,1613
2. For purposes of this paragraph, “Internal Revenue Code” does not include
14the following provisions of federal public laws for taxable years beginning after
15December 31, 2021: sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422
16of P.L.
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59;
17section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of
18P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
19110-172; section 301 of P.L.
110-245; section 15351 of P.L.
110-246; section 302 of
20division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of
21division C of P.L.
110-343; sections 1232, 1251, 1501, and 1502 of division B of P.L.
1111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; section 2122 of P.L.
2111-240; sections 754 and 760 of P.L.
111-312; section 1106 of P.L.
112-95; sections
3104, 318, 322, 323, 326, 327, and 411 of P.L.
112-240; P.L.
114-7; section 1101 of P.L.
4114-74; section 305 of division P of P.L.
114-113; sections 123, 125 to 128, 143, 144,
5151 to 153, 165 to 167, 169 to 171, 189, 191, 307, 326, and 411 of division Q of P.L.
6114-113; sections 11011, 11012, 13201 (a) to (e) and (g), 13206, 13221, 13301, 13304
7(a), (b), and (d), 13531, 13601, 13801, 14101, 14102, 14103, 14201, 14202, 14211,
814212, 14213, 14214, 14215, 14221, 14222, 14301, 14302, 14304, and 14401 of P.L.
9115-97; sections 40304, 40305, 40306, and 40412 of P.L.
115-123; section 101 (c) of
10division T of P.L.
115-141; sections 101 (d) and (e), 102, 201 to 207, 301, 302, and 401
11(a) (47) and (195), (b) (13), (17), (22) and (30), and (d) (1) (D) (v), (vi), and (xiii) and
12(xvii) (II) of division U of P.L.
115-141; sections 104, 114, 115, 116, 130, and 145 of
13division Q of P.L.
116-94; sections 2304 and 2306 of P.L.
116-136; sections 111, 114,
14115, 116, 118 (a) and (d), 133, 137, 138, and 210 of division EE of P.L.
116-260; P.L.
15117-6; P.L.
117-44; P.L.
117-52; section 307 of division P of P.L.
117-103; P.L.
16117-167; P.L.
117-263; and P.L.
117-286.
AB406,3,1817
3. For purposes of this paragraph, “Internal Revenue Code” does not include
18amendments to the federal Internal Revenue Code enacted after December 31, 2021.
AB406,3,2319
4. For purposes of this paragraph, the provisions of federal public laws that
20directly or indirectly affect the Internal Revenue Code, as defined in this paragraph,
21apply for Wisconsin purposes at the same time as for federal purposes, except that
22changes made by section 9671 of P.L.
117-2; and sections 80501 and 80504 of division
23H of P.L.
117-58 apply for taxable years beginning after December 31, 2021.
AB406,3
24Section
3. 71.01 (6) (o) of the statutes is created to read:
AB406,4,5
171.01
(6) (o) 1. For taxable years beginning after December 31, 2022, for
2individuals and fiduciaries, except fiduciaries of nuclear decommissioning trust or
3reserve funds, “Internal Revenue Code” means the federal Internal Revenue Code
4as amended to December 31, 2022, except as provided in subds. 2. and 3. and s. 71.98
5and subject to subd. 4.
AB406,5,56
2. For purposes of this paragraph, “Internal Revenue Code” does not include
7the following provisions of federal public laws for taxable years beginning after
8December 31, 2021: sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422
9of P.L.
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59;
10section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of
11P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
12110-172; section 301 of P.L.
110-245; section 15351 of P.L.
110-246; section 302 of
13division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of
14division C of P.L.
110-343; sections 1232, 1251, 1501, and 1502 of division B of P.L.
15111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; sections 2011 and 2122
16of P.L.
111-240; sections 754 and 760 of P.L.
111-312; section 1106 of P.L.
112-95;
17sections 104, 318, 322, 323, 326, 327, and 411 of P.L.
112-240; P.L.
114-7; section 1101
18of P.L.
114-74; section 305 of division P of P.L.
114-113; sections 123, 125 to 128, 143,
19144, 151 to 153, 165 to 167, 169 to 171, 189, 191, 307, 326, and 411 of division Q of
20P.L.
114-113; sections 11011, 11012, 13201 (a) to (e) and (g), 13206, 13221, 13301,
2113304 (a), (b), and (d), 13531, 13601, 13801, 14101, 14102, 14103, 14201, 14202,
2214211, 14212, 14213, 14214, 14215, 14221, 14222, 14301, 14302, 14304, and 14401
23of P.L.
115-97; sections 40304, 40305, 40306, and 40412 of P.L.
115-123; section 101
24(c) of division T of P.L.
115-141; sections 101 (d) and (e), 102, 201 to 207, 301, 302,
25and 401 (a) (47) and (195), (b) (13), (17), (22) and (30), and (d) (1) (D) (v), (vi), and (xiii)
1and (xvii) (II) of division U of P.L.
115-141; sections 104, 114, 115, 116, 130, and 145
2of division Q of P.L.
116-94; sections 2304 and 2306 of P.L.
116-136; sections 111, 114,
3115, 116, 118 (a) and (d), 133, 137, 138, and 210 of division EE of P.L.
116-260; P.L.
4117-6; P.L.
117-44; P.L.
117-52; section 307 of division P of P.L.
117-103; P.L.
5117-167; P.L.
117-263; P.L.
117-286; and section 4151 of P.L.
117-328.
AB406,5,76
3. For purposes of this paragraph, “Internal Revenue Code” does not include
7amendments to the federal Internal Revenue Code enacted after December 31, 2022.
AB406,5,148
4. For purposes of this paragraph, the provisions of federal public laws that
9directly or indirectly affect the Internal Revenue Code, as defined in this paragraph,
10apply for Wisconsin purposes at the same time as for federal purposes, except that
11changes made by sections 9623 and 9624 of P.L.
117-2; sections 80401, 80402, and
1280601 of division H of P.L.
117-58; sections 13203, 13303, and 13801 of P.L.
117-169;
13and sections 102, 111, 114, 124, 126, and 605 of division T of P.L.
117-328 apply for
14taxable years beginning after December 31, 2022.
AB406,4
15Section
4. 71.22 (4) (m) 1. of the statutes is amended to read:
AB406,5,2016
71.22
(4) (m) 1. For taxable years beginning after December 31, 2020,
and
17before January 1, 2022, “Internal Revenue Code" means the federal Internal
18Revenue Code as amended to December 31, 2020, except as provided in subds. 2. and
193. and subject to subd. 4., and except as provided in sub. (4m) and ss. 71.26 (2) (b) and
20(3), 71.34 (1g), 71.42 (2), and 71.98.
AB406,5
21Section
5. 71.22 (4) (n) of the statutes is created to read:
AB406,6,222
71.22
(4) (n) 1. For taxable years beginning after December 31, 2021, and before
23January 1, 2023, “Internal Revenue Code" means the federal Internal Revenue Code
24as amended to December 31, 2021, except as provided in subds. 2. and 3. and subject
1to subd. 4., and except as provided in sub. (4m) and ss. 71.26 (2) (b) and (3), 71.34 (1g),
271.42 (2), and 71.98.
AB406,7,23
2. For purposes of this paragraph, “Internal Revenue Code” does not include
4the following provisions of federal public laws for taxable years beginning after
5December 31, 2021: sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422
6of P.L.
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59;
7section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of
8P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
9110-172; section 301 of P.L.
110-245; section 15351 of P.L.
110-246; section 302 of
10division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of
11division C of P.L.
110-343; sections 1232, 1251, 1501, and 1502 of division B of P.L.
12111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; sections 2011 and 2122
13of P.L.
111-240; sections 754 and 760 of P.L.
111-312; section 1106 of P.L.
112-95;
14sections 104, 318, 322, 323, 326, 327, and 411 of P.L.
112-240; P.L.
114-7; section 1101
15of P.L.
114-74; section 305 of division P of P.L.
114-113; sections 123, 125 to 128, 143,
16144, 151 to 153, 165 to 167, 169 to 171, 189, 191, 307, 326, and 411 of division Q of
17P.L.
114-113; sections 11011, 11012, 13201 (a) to (e) and (g), 13206, 13221, 13301,
1813304 (a), (b), and (d), 13531, 13601, 13801, 14101, 14102, 14103, 14201, 14202,
1914211, 14212, 14213, 14214, 14215, 14221, 14222, 14301, 14302, 14304, and 14401
20of P.L.
115-97; sections 40304, 40305, 40306, and 40412 of P.L.
115-123; section 101
21(c) of division T of P.L.
115-141; sections 101 (d) and (e), 102, 201 to 207, 301, 302,
22and 401 (a) (47) and (195), (b) (13), (17), (22) and (30), and (d) (1) (D) (v), (vi), and (xiii)
23and (xvii) (II) of division U of P.L.
115-141; sections 104, 114, 115, 116, 130, and 145
24of division Q of P.L.
116-94; sections 2304 and 2306 of P.L.
116-136; sections 111, 114,
25115, 116, 118 (a) and (d), 133, 137, 138, and 210 of division EE of P.L.
116-260; P.L.
1117-6; P.L.
117-44; P.L.
117-52; section 307 of division P of P.L.
117-103; P.L.
2117-167; P.L.
117-263; and P.L.
117-286.
AB406,7,43
3. For purposes of this paragraph, “Internal Revenue Code” does not include
4amendments to the federal Internal Revenue Code enacted after December 31, 2021.
AB406,7,95
4. For purposes of this paragraph, the provisions of federal public laws that
6directly or indirectly affect the Internal Revenue Code, as defined in this paragraph,
7apply for Wisconsin purposes at the same time as for federal purposes, except that
8changes made by section 9671 of P.L.
117-2; and sections 80501 and 80504 of division
9H of P.L.
117-58 apply for taxable years beginning after December 31, 2021.
AB406,6
10Section
6. 71.22 (4) (o) of the statutes is created to read:
AB406,7,1411
71.22
(4) (o) 1. For taxable years beginning after December 31, 2022, “Internal
12Revenue Code" means the federal Internal Revenue Code as amended to December
1331, 2022, except as provided in subds. 2. and 3. and subject to subd. 4., and except
14as provided in sub. (4m) and ss. 71.26 (2) (b) and (3), 71.34 (1g), 71.42 (2), and 71.98.
AB406,8,1415
2. For purposes of this paragraph, “Internal Revenue Code” does not include
16the following provisions of federal public laws for taxable years beginning after
17December 31, 2021: sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422
18of P.L.
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59;
19section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of
20P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
21110-172; section 301 of P.L.
110-245; section 15351 of P.L.
110-246; section 302 of
22division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of
23division C of P.L.
110-343; sections 1232, 1251, 1501, and 1502 of division B of P.L.
24111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; sections 2011 and 2122
25of P.L.
111-240; sections 754 and 760 of P.L.
111-312; section 1106 of P.L.
112-95;
1sections 104, 318, 322, 323, 326, 327, and 411 of P.L.
112-240; P.L.
114-7; section 1101
2of P.L.
114-74; section 305 of division P of P.L.
114-113; sections 123, 125 to 128, 143,
3144, 151 to 153, 165 to 167, 169 to 171, 189, 191, 307, 326, and 411 of division Q of
4P.L.
114-113; sections 11011, 11012, 13201 (a) to (e) and (g), 13206, 13221, 13301,
513304 (a), (b), and (d), 13531, 13601, 13801, 14101, 14102, 14103, 14201, 14202,
614211, 14212, 14213, 14214, 14215, 14221, 14222, 14301, 14302, 14304, and 14401
7of P.L.
115-97; sections 40304, 40305, 40306, and 40412 of P.L.
115-123; section 101
8(c) of division T of P.L.
115-141; sections 101 (d) and (e), 102, 201 to 207, 301, 302,
9and 401 (a) (47) and (195), (b) (13), (17), (22) and (30), and (d) (1) (D) (v), (vi), and (xiii)
10and (xvii) (II) of division U of P.L.
115-141; sections 104, 114, 115, 116, 130, and 145
11of division Q of P.L.
116-94; sections 2304 and 2306 of P.L.
116-136; sections 111, 114,
12115, 116, 118 (a) and (d), 133, 137, 138, and 210 of division EE of P.L.
116-260; P.L.
13117-6; P.L.
117-44; P.L.
117-52; section 307 of division P of P.L.
117-103; P.L.
14117-167; P.L.
117-263; P.L.
117-286; and section 4151 of P.L.
117-328.
AB406,8,1615
3. For purposes of this paragraph, “Internal Revenue Code” does not include
16amendments to the federal Internal Revenue Code enacted after December 31, 2022.
AB406,8,2317
4. For purposes of this paragraph, the provisions of federal public laws that
18directly or indirectly affect the Internal Revenue Code, as defined in this paragraph,
19apply for Wisconsin purposes at the same time as for federal purposes, except that
20changes made by sections 9623 and 9624 of P.L.
117-2; sections 80401, 80402, and
2180601 of division H of P.L.
117-58; sections 13203, 13303, and 13801 of P.L.
117-169;
22and sections 102, 111, 114, 124, 126, and 605 of division T of P.L.
117-328 apply for
23taxable years beginning after December 31, 2022.
AB406,7
24Section
7. 71.22 (4m) (m) 1. of the statutes is amended to read:
AB406,9,5
171.22
(4m) (m) 1. For taxable years beginning after December 31, 2020,
and
2before January 1, 2022, “Internal Revenue Code," for corporations that are subject
3to a tax on unrelated business income under s. 71.26 (1) (a), means the federal
4Internal Revenue Code as amended to December 31, 2020, except as provided in
5subds. 2. and 3. and s. 71.98 and subject to subd. 4.
AB406,8
6Section
8. 71.22 (4m) (n) of the statutes is created to read:
AB406,9,117
71.22
(4m) (n) 1. For taxable years beginning after December 31, 2021, and
8before January 1, 2023, “Internal Revenue Code," for corporations that are subject
9to a tax on unrelated business income under s. 71.26 (1) (a), means the federal
10Internal Revenue Code as amended to December 31, 2021, except as provided in
11subds. 2. and 3. and s. 71.98 and subject to subd. 4.
AB406,9,2512
2. For purposes of this paragraph, “Internal Revenue Code” does not include
13the following provisions of federal public laws for taxable years beginning after
14December 31, 2021: sections 1, 3, 4, and 5 of P.L.
106-519; sections 101, 102, and 422
15of P.L.
108-357; sections 1310 and 1351 of P.L.
109-58; section 11146 of P.L.
109-59;
16section 403 (q) of P.L.
109-135; section 513 of P.L.
109-222; sections 104 and 307 of
17P.L.
109-432; sections 8233 and 8235 of P.L.
110-28; section 11 (e) and (g) of P.L.
18110-172; section 301 of P.L.
110-245; section 15351 of P.L.
110-246; section 302 of
19division A, section 401 of division B, and sections 312, 322, 502 (c), 707, and 801 of
20division C of P.L.
110-343; sections 1232, 1251, 1501, and 1502 of division B of P.L.
21111-5; sections 211, 212, 213, 214, and 216 of P.L.
111-226; sections 2011 and 2122
22of P.L.
111-240; sections 754 and 760 of P.L.
111-312; section 1106 of P.L.
112-95;
23sections 104, 318, 322, 323, 326, 327, and 411 of P.L.
112-240; P.L.
114-7; section 1101
24of P.L.
114-74; section 305 of division P of P.L.
114-113; sections 123, 125 to 128, 143,
25144, 151 to 153, 165 to 167, 169 to 171, 189, 191, 307, 326, and 411 of division Q of
1P.L.
114-113; sections 11011, 11012, 13201 (a) to (e) and (g), 13206, 13221, 13301,
213304 (a), (b), and (d), 13531, 13601, 13801, 14101, 14102, 14103, 14201, 14202,
314211, 14212, 14213, 14214, 14215, 14221, 14222, 14301, 14302, 14304, and 14401
4of P.L.
115-97; sections 40304, 40305, 40306, and 40412 of P.L.
115-123; section 101
5(c) of division T of P.L.
115-141; sections 101 (d) and (e), 102, 201 to 207, 301, 302,
6and 401 (a) (47) and (195), (b) (13), (17), (22) and (30), and (d) (1) (D) (v), (vi), and (xiii)
7and (xvii) (II) of division U of P.L.
115-141; sections 104, 114, 115, 116, 130, and 145
8of division Q of P.L.
116-94; sections 2304 and 2306 of P.L.
116-136; sections 111, 114,
9115, 116, 118 (a) and (d), 133, 137, 138, and 210 of division EE of P.L.
116-260; P.L.
10117-6; P.L.
117-44; P.L.
117-52; section 307 of division P of P.L.
117-103; P.L.
11117-167; P.L.
117-263; and P.L.
117-286.
AB406,10,1312
3. For purposes of this paragraph, “Internal Revenue Code” does not include
13amendments to the federal Internal Revenue Code enacted after December 31, 2021.
AB406,10,1814
4. For purposes of this paragraph, the provisions of federal public laws that
15directly or indirectly affect the Internal Revenue Code, as defined in this paragraph,
16apply for Wisconsin purposes at the same time as for federal purposes, except that
17changes made by section 9671 of P.L.
117-2; and sections 80501 and 80504 of division
18H of P.L.
117-58 apply for taxable years beginning after December 31, 2021.
AB406,9
19Section
9. 71.22 (4m) (o) of the statutes is created to read:
