LRBs0279/1
JK:ahe
2019 - 2020 LEGISLATURE
ASSEMBLY SUBSTITUTE AMENDMENT 1,
TO ASSEMBLY BILL 873
February 17, 2020 - Offered by
Joint Committee on Finance.
AB873-ASA1,1,7
1An Act to amend 71.05 (6) (a) 15., 71.10 (4) (i), 71.21 (4) (a), 71.26 (2) (a) 4., 71.30
2(3) (f), 71.34 (1k) (g), 71.45 (2) (a) 10., 71.49 (1) (f), 71.58 (intro.), 71.59 (1) (a),
371.59 (1) (b) (intro.), 71.59 (2) (intro.), 71.60 (1) (intro.) and 71.60 (2);
to repeal
4and recreate 71.05 (6) (a) 15., 71.10 (4) (i), 71.21 (4) (a), 71.26 (2) (a) 4., 71.30
5(3) (f), 71.34 (1k) (g), 71.45 (2) (a) 10. and 71.49 (1) (f); and
to create 71.595 and
671.61 (7) of the statutes;
relating to: an income tax credit for the property taxes
7paid on agricultural buildings and improvements.
Analysis by the Legislative Reference Bureau
This bill creates an income and franchise tax credit equal to approximately 66
percent of the taxes levied on buildings and other improvements, not including
residential property, that are located in this state and used exclusively for farming.
The credit is limited to $7,500 for an individual, entity, or married couple filing
jointly. In addition, in order to claim the credit, the claimant must have at least
$35,000 in annual gross income from farming. The person will receive a refund if the
amount of the credit exceeds the person's tax liability. Under the bill, the credit is
part of the farmland preservation credit program under current law.
The bill also allows a taxpayer to claim the credit online in 2020 based on the
the 2019 assessed value of the taxpayer's buildings and other improvements, not
including residential property, that are located in this state and used exclusively for
farming.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB873-ASA1,1
1Section 1
. 71.05 (6) (a) 15. of the statutes is amended to read:
AB873-ASA1,2,82
71.05
(6) (a) 15. Except as provided under s. 71.07 (3p) (c) 5., the amount of the
3credits computed under
s. ss. 71.07 (2dm), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r),
4(3rm), (3rn), (3s), (3t), (3w), (3wm), (3y), (4k), (4n), (5e), (5f), (5h), (5i), (5j), (5k), (5r),
5(5rm), (6n), (8r), and (10)
and 71.595 and not passed through by a partnership,
6limited liability company, or tax-option corporation that has added that amount to
7the partnership's, company's, or tax-option corporation's income under s. 71.21 (4)
8or 71.34 (1k) (g).
AB873-ASA1,2,1611
71.05
(6) (a) 15. Except as provided under s. 71.07 (3p) (c) 5., the amount of the
12credits computed under ss. 71.07 (2dm), (2dx), (2dy), (3g), (3h), (3n), (3q), (3s), (3t),
13(3w), (3wm), (3y), (4k), (4n), (5e), (5i), (5j), (5k), (5r), (5rm), (6n), and (10) and 71.595
14and not passed through by a partnership, limited liability company, or tax-option
15corporation that has added that amount to the partnership's, company's, or
16tax-option corporation's income under s. 71.21 (4) or 71.34 (1k) (g).
AB873-ASA1,3
17Section 3
. 71.10 (4) (i) of the statutes is amended to read:
AB873-ASA1,3,1218
71.10
(4) (i) The total of claim of right credit under s. 71.07 (1), farmland
19preservation credit
or farm buildings credit under ss. 71.57 to 71.61, farmland
20preservation credit, 2010 and beyond under s. 71.613, homestead credit under subch.
1VIII, farmland tax relief credit under s. 71.07 (3m), dairy manufacturing facility
2investment credit under s. 71.07 (3p), jobs tax credit under s. 71.07 (3q), meat
3processing facility investment credit under s. 71.07 (3r), woody biomass harvesting
4and processing credit under s. 71.07 (3rm), food processing plant and food warehouse
5investment credit under s. 71.07 (3rn), business development credit under s. 71.07
6(3y), research credit under s. 71.07 (4k) (e) 2. a., film production services credit under
7s. 71.07 (5f), film production company investment credit under s. 71.07 (5h), veterans
8and surviving spouses property tax credit under s. 71.07 (6e), enterprise zone jobs
9credit under s. 71.07 (3w), electronics and information technology manufacturing
10zone credit under s. 71.07 (3wm), beginning farmer and farm asset owner tax credit
11under s. 71.07 (8r), earned income tax credit under s. 71.07 (9e), estimated tax
12payments under s. 71.09, and taxes withheld under subch. X.
AB873-ASA1,4
13Section 4
. 71.10 (4) (i) of the statutes, as affected by
2019 Wisconsin Act 54 and
142019 Wisconsin Act .... (this act), is repealed and recreated to read:
AB873-ASA1,3,2415
71.10
(4) (i) The total of claim of right credit under s. 71.07 (1), farmland
16preservation credit or farm buildings credit under ss. 71.57 to 71.61, farmland
17preservation credit, 2010 and beyond under s. 71.613, homestead credit under subch.
18VIII, farmland tax relief credit under s. 71.07 (3m), jobs tax credit under s. 71.07 (3q),
19business development credit under s. 71.07 (3y), research credit under s. 71.07 (4k)
20(e) 2. a., veterans and surviving spouses property tax credit under s. 71.07 (6e),
21enterprise zone jobs credit under s. 71.07 (3w), electronics and information
22technology manufacturing zone credit under s. 71.07 (3wm), earned income tax
23credit under s. 71.07 (9e), estimated tax payments under s. 71.09, and taxes withheld
24under subch. X.
AB873-ASA1,5
25Section 5
. 71.21 (4) (a) of the statutes is amended to read:
AB873-ASA1,4,5
171.21
(4) (a) The amount of the credits computed by a partnership under
s. ss. 271.07 (2dm), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3s), (3t), (3w),
3(3wm), (3y), (4k), (4n), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), (8r), and
4(10)
and 71.595 and passed through to partners shall be added to the partnership's
5income.
AB873-ASA1,6
6Section 6
. 71.21 (4) (a) of the statutes, as affected by
2019 Wisconsin Act 54 7and 2019 Wisconsin Act .... (this act), is repealed and recreated to read:
AB873-ASA1,4,118
71.21
(4) (a) The amount of the credits computed by a partnership under ss.
971.07 (2dm), (2dx), (2dy), (3g), (3h), (3n), (3q), (3s), (3t), (3w), (3wm), (3y), (4k), (4n),
10(5e), (5g), (5i), (5j), (5k), (5r), (5rm), (6n), and (10) and 71.595 and passed through to
11partners shall be added to the partnership's income.
AB873-ASA1,7
12Section 7
. 71.26 (2) (a) 4. of the statutes is amended to read:
AB873-ASA1,4,1813
71.26
(2) (a) 4. Plus the amount of the credit computed under
s. ss. 71.28 (1dm),
14(1dx), (1dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn), (3t), (3w), (3wm), (3y), (5e),
15(5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), (8r), (9s), and (10)
and 71.595 and not
16passed through by a partnership, limited liability company, or tax-option
17corporation that has added that amount to the partnership's, limited liability
18company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1k) (g).
AB873-ASA1,8
19Section 8
. 71.26 (2) (a) 4. of the statutes, as affected by
2019 Wisconsin Act 54 20and 2019 Wisconsin Act .... (this act), is repealed and recreated to read:
AB873-ASA1,5,221
71.26
(2) (a) 4. Plus the amount of the credit computed under ss. 71.28 (1dm),
22(1dx), (1dy), (3g), (3h), (3n), (3q), (3t), (3w), (3wm), (3y), (5e), (5g), (5i), (5j), (5k), (5r),
23(5rm), (6n), (9s), and (10) and 71.595 and not passed through by a partnership,
24limited liability company, or tax-option corporation that has added that amount to
1the partnership's, limited liability company's, or tax-option corporation's income
2under s. 71.21 (4) or 71.34 (1k) (g).
AB873-ASA1,9
3Section 9
. 71.30 (3) (f) of the statutes is amended to read:
AB873-ASA1,5,144
71.30
(3) (f) The total of farmland preservation credit
and farm buildings credit 5under subch. IX, farmland tax relief credit under s. 71.28 (2m), dairy manufacturing
6facility investment credit under s. 71.28 (3p), jobs credit under s. 71.28 (3q), meat
7processing facility investment credit under s. 71.28 (3r), woody biomass harvesting
8and processing credit under s. 71.28 (3rm), food processing plant and food warehouse
9investment credit under s. 71.28 (3rn), enterprise zone jobs credit under s. 71.28
10(3w), electronics and information technology manufacturing zone credit under s.
1171.28 (3wm), business development credit under s. 71.28 (3y), research credit under
12s. 71.28 (4) (k) 1., film production services credit under s. 71.28 (5f), film production
13company investment credit under s. 71.28 (5h), beginning farmer and farm asset
14owner tax credit under s. 71.28 (8r), and estimated tax payments under s. 71.29.
AB873-ASA1,10
15Section 10
. 71.30 (3) (f) of the statutes, as affected by
2019 Wisconsin Act 54 16and 2019 Wisconsin Act .... (this act), is repealed and recreated to read:
AB873-ASA1,5,2217
71.30
(3) (f) The total of farmland preservation credit and farm buildings credit
18under subch. IX, farmland tax relief credit under s. 71.28 (2m), jobs credit under s.
1971.28 (3q), enterprise zone jobs credit under s. 71.28 (3w), electronics and
20information technology manufacturing zone credit under s. 71.28 (3wm), business
21development credit under s. 71.28 (3y), research credit under s. 71.28 (4) (k) 1., and
22estimated tax payments under s. 71.29.
AB873-ASA1,11
23Section 11
. 71.34 (1k) (g) of the statutes is amended to read:
AB873-ASA1,6,224
71.34
(1k) (g) An addition shall be made for credits computed by a tax-option
25corporation under
s. ss. 71.28 (1dm), (1dx), (1dy), (3), (3g), (3h), (3n), (3p), (3q), (3r),
1(3rm), (3rn), (3t), (3w), (3wm), (3y), (4), (5), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5r),
2(5rm), (6n), (8r), and (10)
and 71.595 and passed through to shareholders.
AB873-ASA1,12
3Section 12
. 71.34 (1k) (g) of the statutes, as affected by
2019 Wisconsin Act 54 4and 2019 Wisconsin Act .... (this act), is repealed and recreated to read:
AB873-ASA1,6,85
71.34
(1k) (g) An addition shall be made for credits computed by a tax-option
6corporation under ss. 71.28 (1dm), (1dx), (1dy), (3), (3g), (3h), (3n), (3q), (3t), (3w),
7(3wm), (3y), (4), (5), (5e), (5g), (5i), (5j), (5k), (5r), (5rm), (6n), and (10) and 71.595 and
8passed through to shareholders.
AB873-ASA1,13
9Section 13
. 71.45 (2) (a) 10. of the statutes is amended to read:
AB873-ASA1,6,1610
71.45
(2) (a) 10. By adding to federal taxable income the amount of credit
11computed under
s. ss. 71.47 (1dm) to (1dy), (3g), (3h), (3n), (3p), (3q), (3r), (3rm), (3rn),
12(3w), (3y), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), (8r), (9s), and (10)
and
1371.595 and not passed through by a partnership, limited liability company, or
14tax-option corporation that has added that amount to the partnership's, limited
15liability company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1k)
16(g) and the amount of credit computed under s. 71.47 (1), (3), (3t), (4), (4m), and (5).
AB873-ASA1,6,2519
71.45
(2) (a) 10. By adding to federal taxable income the amount of credit
20computed under ss. 71.47 (1dm) to (1dy), (3g), (3h), (3n), (3q), (3w), (3y), (5e), (5g), (5i),
21(5j), (5k), (5r), (5rm), (6n), (9s), and (10) and 71.595 and not passed through by a
22partnership, limited liability company, or tax-option corporation that has added that
23amount to the partnership's, limited liability company's, or tax-option corporation's
24income under s. 71.21 (4) or 71.34 (1k) (g) and the amount of credit computed under
25s. 71.47 (1), (3), (3t), (4), (4m), and (5).
AB873-ASA1,15
1Section
15. 71.49 (1) (f) of the statutes is amended to read:
AB873-ASA1,7,112
71.49
(1) (f) The total of farmland preservation credit
and farm buildings credit 3under subch. IX, farmland tax relief credit under s. 71.47 (2m), dairy manufacturing
4facility investment credit under s. 71.47 (3p), jobs credit under s. 71.47 (3q), meat
5processing facility investment credit under s. 71.47 (3r), woody biomass harvesting
6and processing credit under s. 71.47 (3rm), food processing plant and food warehouse
7investment credit under s. 71.47 (3rn), enterprise zone jobs credit under s. 71.47
8(3w), business development credit under s. 71.47 (3y), research credit under s. 71.47
9(4) (k) 1., film production services credit under s. 71.47 (5f), film production company
10investment credit under s. 71.47 (5h), beginning farmer and farm asset owner tax
11credit under s. 71.47 (8r), and estimated tax payments under s. 71.48.
AB873-ASA1,16
12Section 16
. 71.49 (1) (f) of the statutes, as affected by
2019 Wisconsin Act 54 13and 2019 Wisconsin Act .... (this act), is repealed and recreated to read:
AB873-ASA1,7,1814
71.49
(1) (f) The total of farmland preservation credit and farm buildings credit
15under subch. IX, farmland tax relief credit under s. 71.47 (2m), jobs credit under s.
1671.47 (3q), enterprise zone jobs credit under s. 71.47 (3w), business development
17credit under s. 71.47 (3y), research credit under s. 71.47 (4) (k) 1., and estimated tax
18payments under s. 71.48.
AB873-ASA1,17
19Section 17
. 71.58 (intro.) of the statutes is amended to read:
AB873-ASA1,7,21
2071.58 Definitions. (intro.)
In Except as provided in s. 71.595, in ss. 71.57 to
2171.61:
AB873-ASA1,18
22Section 18
. 71.59 (1) (a) of the statutes is amended to read:
AB873-ASA1,8,623
71.59
(1) (a) Subject to the limitations provided in ss. 71.57 to 71.61 and s. 71.80
24(3) and (3m),
and except as provided in s. 71.595, a claimant may claim as a credit
25against Wisconsin income or franchise taxes otherwise due, the amount derived
1under s. 71.60. If the allowable amount of claim exceeds the income or franchise
2taxes otherwise due on or measured by the claimant's income or if there are no
3Wisconsin income or franchise taxes due on or measured by the claimant's income,
4the amount of the claim not used as an offset against income or franchise taxes shall
5be certified to the department of administration for payment to the claimant by
6check, share draft or other draft drawn on the general fund.
AB873-ASA1,19
7Section
19. 71.59 (1) (b) (intro.) of the statutes is amended to read:
AB873-ASA1,8,108
71.59
(1) (b) (intro.) Every claimant under ss. 71.57 to 71.61
, not including a
9claimant under s. 71.595, shall supply, at the request of the department, in support
10of the claim, all of the following:
AB873-ASA1,20
11Section
20. 71.59 (2) (intro.) of the statutes is amended to read:
AB873-ASA1,8,1312
71.59
(2) Ineligible claims. (intro.)
No Except for a credit under s. 71.595, no 13credit shall be allowed under ss. 71.57 to 71.61:
AB873-ASA1,21
14Section 21
. 71.595 of the statutes is created to read:
AB873-ASA1,8,15
1571.595 Farm buildings credit. (1) Definitions. In this section:
AB873-ASA1,8,1616
(a) “Claimant” means a person who files a claim under this section.
AB873-ASA1,8,1917
(b) “Residential property” means property that is assessed as residential
18property under s. 70.32 (2) (a) 1. or a residence that is assessed as other under s. 70.32
19(2) (a) 7.
AB873-ASA1,8,2120
(c) “Used exclusively” means used to the exclusion of all other uses except for
21use not exceeding 5 percent of total use.
AB873-ASA1,9,3
22(2) Filing claims. Subject to the limitations provided in this section, for taxable
23years beginning after December 31, 2019, and before January 1, 2023, a claimant
24may claim as a credit against the taxes imposed under s. 71.02, 71.23, or 71.43 an
25amount equal to the assessed value that is associated with the most recent property
1tax bill of the claimant's buildings and improvements assessed as other under s.
270.32 (2) (a) 7., not including residential property, that are used exclusively for
3farming, multiplied by 0.01187.
AB873-ASA1,9,11
4(3) Limitations. (a) Partnerships, limited liability companies, and tax-option
5corporations may not claim the credit under this section, but the eligibility for, and
6the amount of, the credit are based on the determination described under sub. (2).
7A partnership, limited liability company, or tax-option corporation shall compute
8the amount of credit that each of its partners, members, or shareholders may claim
9and shall provide that information to each of them. Partners, members of limited
10liability companies, and shareholders of tax-option corporations may claim the
11credit in proportion to their ownership interests.
AB873-ASA1,9,1412
(b) No credit may be allowed under this section if the claimant or the claimant's
13spouse files a claim under s. 71.07 (6e) or (9) or subch. VIII that relates to the same
14taxable year for which a claim is made under this section.
AB873-ASA1,9,1615
(c) The maximum amount of the credit that a claimant may claim under this
16section in a taxable year is $7,500 for an individual or a married couple filing jointly.
AB873-ASA1,9,2317
(d) No claimant may claim a credit under this section unless the claimant is a
18farmer and files a schedule F for the taxable year for which the claimant claims the
19credit or is an entity actively engaged in farming under
7 CFR 1400.201 for that
20taxable year. No claimant may claim a credit under this section unless the claimant's
21annual gross income from farming for the year in which the claim relates is not less
22than $35,000. For purposes of this paragraph, “gross income” has the meaning given
23in s. 71.03 (1).
AB873-ASA1,9,25
24(4) Administration. (a) Section 71.28 (4) (g) and (h), as it applies to the credit
25under s. 71.28 (4), applies to the credit under this section.
AB873-ASA1,10,4
1(b) If the allowable amount of the claim under this section exceeds the taxes
2otherwise due on the claimant's income under s. 71.02, 71.23, or 71.43, the amount
3of the claim that is not used to offset those taxes shall be certified by the department
4of revenue to the department of administration for payment as a refund.
AB873-ASA1,22
5Section
22. 71.60 (1) (intro.) of the statutes is amended to read:
AB873-ASA1,10,86
71.60
(1) (intro.) Except as provided in sub. (2)
and s. 71.595, the amount of any
7claim filed in calendar years based upon property taxes accrued in the preceding
8calendar year shall be determined as follows:
AB873-ASA1,23
9Section
23. 71.60 (2) of the statutes is amended to read:
AB873-ASA1,10,1410
71.60
(2) If the farmland is subject to a certified ordinance under subch. V of
11ch. 91, 2007 stats., or an agreement under subch. II of ch. 91, 2007 stats., in effect
12at the close of the year for which the credit is claimed, the amount of the claim
, not
13including a claim under s. 71.595, is 10 percent of the property taxes accrued or the
14amount determined under sub. (1), whichever is greater.
AB873-ASA1,24
15Section
24. 71.61 (7) of the statutes is created to read:
AB873-ASA1,10,1716
71.61
(7) Nonapplicability. This section does not apply to claims under s.
1771.595.
AB873-ASA1,11,319
(1)
Farm buildings credit. A person who is eligible to claim the farm buildings
20credit under s. 71.595, may claim the credit by filing a claim online, as prescribed by
21the department of revenue, rather than filing a return in order to claim and receive
22the credit. This subsection does not relieve the claimant's obligation to otherwise file
23a return for that taxable year. The claimant shall calculate the credit based on the
24assessed value as of January 1, 2019, of the claimant's buildings and improvements
25assessed as other under s. 70.32 (2) (a) 7., not including residential property, that are
1used exclusively for farming. The department shall process claims submitted under
2this subsection as expeditiously as possible and certify the claims for payment as
3provided under s. 71.595 (4) (b).