AB1038: Bill Text

1. Exempts from otherwise applicable penalties certain taxable year 2020 distributions from a retirement account qualified under the Internal Revenue Code, and exempts from income taxation these distributions subject to a number of conditions.

2. Creates additional deductions, for taxable year 2020, for certain individual charitable contributions, and suspends the limitations on certain individual and corporate charitable deductions. The suspension of limitations applies to contributions made in calendar year 2020 only, although certain amounts donated in 2020 may be carried forward to future years.

3. Clarifies that an individual's health insurance plan is still treated as a high deductible plan even if it fails to provide a deductible for telehealth and other remote care services.

4. Conforms state law to federal law regarding the treatment of paycheck protection loans to businesses and employees under the small business administration's loan guarantee program for the period of time from February 15, 2020, through June 30, 2020. A portion of the loans may be forgiven on a tax-free basis under certain conditions.

5. Provides an exclusion from income for certain student loan principal and interest payments made by an employer on behalf of an employee, subject to the same current law cap of $5,250 in payments for qualified educational expenses made on behalf of an employee by an employer. This provision applies to payments made from March 28, 2020, through December 31, 2020.

6. Corrects a drafting error in the federal Tax Cuts and Jobs Act of 2017 to provide a 15-year recovery period for qualified improvement property.

Authority to waive interest and penalties for general fund and transportation fund taxes

This bill authorizes the secretary of revenue to waive, for any person who fails to remit general fund taxes or transportation fund taxes and fees by their due date, the interest and penalties that accrue during the period covered by the COVID-19 public health emergency if the due date falls within that period and the secretary determines that the person's failure is due to the effects of the COVID-19 pandemic.

Interest on late property tax payments

Under current law, a late installment payment of property taxes is subject to interest and penalties, with the interest accruing from February 1 of the year in which the taxes are due. Under this bill, for property taxes payable in 2020, after making a general or case-by-case finding of hardship, a municipality may provide that an installment payment due after April 1, 2020, that is received after its due date will not accrue interest or penalties if the total amount due is received on or before October 1, 2020. Interest and penalties will accrue from October 1, 2020, for any property taxes payable in 2020 that are delinquent after October 1, 2020.

Claims for recovery of unlawful taxes and excessive assessments

Current law allows a person to file a claim to recover the unlawful imposition of property taxes or a claim for the excessive assessment of property taxes. However, no person may file a claim for recovery of unlawful taxes or excessive assessment unless the person has paid his or her property taxes on time. The bill provides that this restriction does not apply to taxes due and payable in 2020 if paid by October 1, 2020, or by any installment date for which taxes are due after October 1, 2020.

Because this bill creates a new crime or revises a penalty for an existing crime, the Joint Review Committee on Criminal Penalties may be requested to prepare a report.

This proposal may contain a health insurance mandate requiring a social and financial impact report under s. 601.423, stats.

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 and local 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:

AB1038,1 Section 1 . 13.101 (4) of the statutes is amended to read:

AB1038,19,16 13.101 (4) The committee may transfer between appropriations and programs if the committee finds that unnecessary duplication of functions can be eliminated, more efficient and effective methods for performing programs will result or legislative intent will be more effectively carried out because of such transfer, if legislative intent will not be changed as the result of such transfer and the purposes for which the transfer is requested have been authorized or directed by the legislature. The authority to transfer between appropriations includes the authority to transfer between 2 fiscal years of the same biennium, between 2 appropriations of the same agency and between an appropriation of one agency and an appropriation of a different agency. No transfer between appropriations or programs may be made to offset deficiencies arising from the lack of adequate expenditure controls by a department, board, institution, commission or agency. The Except as provided in sub. (4d), the authority to transfer between appropriations shall not include the authority to transfer from sum sufficient appropriations as defined under s. 20.001 (3) (d) to other types of appropriations.

AB1038,2 Section 2 . 13.101 (4d) of the statutes is created to read:

AB1038,20,5 13.101 (4d) During the public health emergency declared on March 12, 2020, by executive order 72, and for a period of 90 days after termination of the emergency, the committee may transfer under sub. (4) an amount not to exceed $75,000,000 from sum sufficient appropriations, as defined under s. 20.001 (3) (d), to be used for expenditures related to the emergency.

AB1038,3 Section 3 . 20.866 (2) (xm) of the statutes is amended to read:

AB1038,20,18 20.866 (2) (xm) Building commission; refunding tax-supported and self-amortizing general obligation debt. From the capital improvement fund, a sum sufficient to refund the whole or any part of any unpaid indebtedness used to finance tax-supported or self-amortizing facilities. In addition to the amount that may be contracted under par. (xe), the state may contract public debt in an amount not to exceed $6,785,000,000 $7,510,000,000 for this purpose. Such indebtedness shall be construed to include any premium and interest payable with respect thereto. Debt incurred by this paragraph shall be repaid under the appropriations providing for the retirement of public debt incurred for tax-supported and self-amortizing facilities in proportional amounts to the purposes for which the debt was refinanced. No moneys may be expended under this paragraph unless the true interest costs to the state can be reduced by the expenditure.

AB1038,4 Section 4 . 40.22 (1) of the statutes is amended to read:

AB1038,20,24 40.22 (1) Except as otherwise provided in sub. (2) and s. 40.26 (6), each employee currently in the service of, and receiving earnings from, a state agency or other participating employer shall be included within the provisions of the Wisconsin retirement system as a participating employee of that state agency or participating employer.

AB1038,5 Section 5 . 40.22 (2m) (intro.) of the statutes is amended to read:

AB1038,21,7 40.22 (2m) (intro.) An Except as otherwise provided in s. 40.26 (6), an employee who was a participating employee before July 1, 2011, who is not expected to work at least one-third of what is considered full-time employment by the department, as determined by rule, and who is not otherwise excluded under sub. (2) from becoming a participating employee shall become a participating employee if he or she is subsequently employed by the state agency or other participating employer for either of the following periods:

AB1038,6 Section 6 . 40.22 (2r) (intro.) of the statutes is amended to read:

AB1038,21,15 40.22 (2r) (intro.) An Except as otherwise provided in s. 40.26 (6), an employee who was not a participating employee before July 1, 2011, who is not expected to work at least two-thirds of what is considered full-time employment by the department, as determined by rule, and who is not otherwise excluded under sub. (2) from becoming a participating employee shall become a participating employee if he or she is subsequently employed by the state agency or other participating employer for either of the following periods:

AB1038,7 Section 7 . 40.22 (3) (intro.) of the statutes is amended to read:

AB1038,21,19 40.22 (3) (intro.) A Except as otherwise provided in s. 40.26 (6), a person who qualifies as a participating employee shall be included within, and shall be subject to, the Wisconsin retirement system effective on one of the following dates:

AB1038,8 Section 8 . 40.26 (1m) (a) of the statutes is amended to read:

AB1038,22,2 40.26 (1m) (a) If Except as otherwise provided in sub. (6), if a participant receiving a retirement annuity, or a disability annuitant who has attained his or her normal retirement date, is employed in a position in covered employment in which he or she is expected to work at least two-thirds of what is considered full-time employment by the department, as determined under s. 40.22 (2r), the participant's annuity shall be suspended and no annuity payment shall be payable until after the participant terminates covered employment.

AB1038,9 Section 9 . 40.26 (1m) (b) of the statutes is amended to read:

AB1038,22,11 40.26 (1m) (b) If Except as otherwise provided in sub. (6), if a participant receiving a retirement annuity, or a disability annuitant who has attained his or her normal retirement date, enters into a contract to provide employee services with a participating employer and he or she is expected to work at least two-thirds of what is considered full-time employment by the department, as determined under s. 40.22 (2r), the participant's annuity shall be suspended and no annuity payment shall be payable until after the participant no longer provides employee services under the contract.

AB1038,10 Section 10 . 40.26 (5) (intro.) of the statutes is amended to read:

AB1038,22,17 40.26 (5) (intro.) If Except as otherwise provided in sub. (5m), if a participant applies for an annuity or lump sum payment during the period in which less than 75 days have elapsed between the termination of employment with a participating employer and becoming a participating employee with any participating employer, all of the following shall apply:

AB1038,11 Section 11 . 40.26 (5m) of the statutes is created to read:

AB1038,22,23 40.26 (5m) During the public health emergency declared on March 12, 2020, by executive order 72, sub. (5) does not apply if at least 15 days have elapsed between the termination of employment with a participating employer and becoming a participating employee if the position for which the participant is hired is a critical position, as determined by the secretary of health services under s. 323.19 (3).

AB1038,12 Section 12 . 40.26 (6) of the statutes is created to read:

AB1038,23,4 40.26 (6) A participant who is hired during the public health emergency declared on March 12, 2020, by executive order 72, may elect to not suspend his or her retirement annuity or disability annuity under sub. (1m) for the duration of the state of emergency if all of the following conditions are met:

AB1038,23,8 (a) At the time the participant terminates his or her employment with a participating employer, the participant does not have an agreement with any participating employer to return to employment or enter into a contract to provide employee services for the employer.

AB1038,23,10 (b) The position for which the participant has been hired is a critical position, as determined under s. 323.19 (3).

AB1038,13 Section 13 . 40.51 (8) of the statutes is amended to read:

AB1038,23,16 40.51 (8) Every health care coverage plan offered by the state under sub. (6) shall comply with ss. 631.89, 631.90, 631.93 (2), 631.95, 632.72 (2), 632.729, 632.746 (1) to (8) and (10), 632.747, 632.748, 632.798, 632.83, 632.835, 632.85, 632.853, 632.855, 632.867, 632.87 (3) to (6), 632.885, 632.89, 632.895 (5m) and (8) to (17), and 632.896.

AB1038,14 Section 14 . 40.51 (8m) of the statutes is amended to read:

AB1038,23,21 40.51 (8m) Every health care coverage plan offered by the group insurance board under sub. (7) shall comply with ss. 631.95, 632.729, 632.746 (1) to (8) and (10), 632.747, 632.748, 632.798, 632.83, 632.835, 632.85, 632.853, 632.855, 632.867, 632.885, 632.89, and 632.895 (11) to (17).

AB1038,15 Section 15 . 49.688 (1) (c) of the statutes is renumbered 49.688 (1) (c) (intro.) and amended to read:

AB1038,23,24 49.688 (1) (c) (intro.) “Prescription drug" means a any of the following:

AB1038,24,3 1. A prescription drug, as defined in s. 450.01 (20), that is included in the drugs specified under s. 49.46 (2) (b) 6. h. and that is manufactured by a drug manufacturer that enters into a rebate agreement in force under sub. (6).

AB1038,16 Section 16 . 49.688 (1) (c) 2. of the statutes is created to read:

AB1038,24,8 49.688 (1) (c) 2. A vaccination recommended for administration to adults by the federal centers for disease control and prevention's advisory committee on immunization practices and approved for administration to adults by the department.

AB1038,17 Section 17 . 49.688 (10m) of the statutes is created to read:

AB1038,25,3 49.688 (10m) (a) Notwithstanding subs. (6) and (7) (a), from the appropriation accounts under s. 20.435 (4) (bv), (j), and (pg), except as provided under sub. (7) (b), the department shall, under a schedule that is identical to that used by the department for payment of claims under the Medical Assistance program, provide to health care providers who administer vaccinations, including pharmacies and pharmacists, payments for vaccinations, as described under sub. (1) (c) 2., that are administered by health care providers to persons eligible under sub. (2) who have paid the deductible specified under sub. (3) (b) 1. or 2., or who, under sub. (3) (b) 1., are not required to pay a deductible. The reimbursement to a health care provider for each vaccination under this subsection shall be at the rate of payment made for the identical vaccination under s. 49.46 (2) (b), plus a dispensing fee that is equal to the dispensing fee permitted to be charged for vaccinations for which coverage is provided under s. 49.46 (2) (b). The department shall devise and distribute a claim form for use by health care providers under this subsection and may limit payment under this subsection to those vaccinations for which payment claims are submitted by health care providers directly to the department. The department may apply to the program under this subsection the same utilization and cost control procedures that apply under rules promulgated by the department to medical assistance under subch. IV of ch. 49.

AB1038,25,6 (b) The department may provide payment for a vaccination under this subsection only after deducting the amount of any payment for the vaccination available from other sources.

AB1038,18 Section 18 . 60.11 (2) (b) of the statutes is renumbered 60.11 (2) (b) 1.

AB1038,19 Section 19 . 60.11 (2) (b) 2. of the statutes is created to read:

AB1038,25,13 60.11 (2) (b) 2. The town board or, if the town board is unable to promptly meet, the town chair may postpone the annual town meeting to a date that is not during the period beginning on the first day of the public health emergency declared on March 12, 2020, by executive order 72, and ending 60 days after the termination of that order.

AB1038,20 Section 20 . 66.0137 (4) of the statutes is amended to read:

AB1038,25,21 66.0137 (4) Self-insured health plans. If a city, including a 1st class city, or a village provides health care benefits under its home rule power, or if a town provides health care benefits, to its officers and employees on a self-insured basis, the self-insured plan shall comply with ss. 49.493 (3) (d), 631.89, 631.90, 631.93 (2), 632.729, 632.746 (10) (a) 2. and (b) 2., 632.747 (3), 632.798, 632.85, 632.853, 632.855, 632.867, 632.87 (4) to (6), 632.885, 632.89, 632.895 (9) to (17), 632.896, and 767.513 (4).

AB1038,21 Section 21 . 70.47 (3) (aL) of the statutes is renumbered 70.47 (3) (aL) 1. and amended to read:

AB1038,26,2 70.47 (3) (aL) 1. If Except as provided in subd. 2., if the assessment roll is not completed at the time of the first meeting, the board shall adjourn for the time necessary to complete the roll, and shall post a written notice on the outer door of the place of meeting stating the time to which the meeting is adjourned.

AB1038,22 Section 22 . 70.47 (3) (aL) 2. of the statutes is created to read:

AB1038,26,7 70.47 (3) (aL) 2. Regardless of whether the 2020 assessment roll is completed at the time of the 45-day period beginning on the 4th Monday of April, the board may publish a class 1 notice under ch. 985 that the board has adjourned and will proceed under sub. (2).

AB1038,23 Section 23 . 71.01 (6) (L) 3. of the statutes is amended to read:

AB1038,26,13 71.01 (6) (L) 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 1106, 2202, 2203, 2204, 2205, 2206, 2307, 3608, 3609, 3701, and 3702 of division A of P.L. 116-136.

AB1038,24 Section 24 . 71.22 (4) (L) 3. of the statutes is amended to read:

AB1038,26,19 71.22 (4) (L) 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 1106, 2202, 2203, 2204, 2205, 2206, 2307, 3608, 3609, 3701, and 3702 of division A of P.L. 116-136.

AB1038,25 Section 25 . 71.22 (4m) (L) 3. of the statutes is amended to read:

AB1038,26,25 71.22 (4m) (L) 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 1106, 2202, 2203, 2204, 2205, 2206, 2307, 3608, 3609, 3701, and 3702 of division A of P.L. 116-136.

AB1038,26 Section 26. 71.26 (2) (b) 12. d. of the statutes is amended to read:

AB1038,27,6 71.26 (2) (b) 12. d. For purposes of subd. 12. a., “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 1106, 2202, 2203, 2204, 2205, 2206, 2307, 3608, 3609, 3701, and 3702 of division A of P.L. 116-136.

AB1038,27 Section 27 . 71.34 (1g) (L) 3. of the statutes is amended to read:

AB1038,27,12 71.34 (1g) (L) 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 1106, 2202, 2203, 2204, 2205, 2206, 2307, 3608, 3609, 3701, and 3702 of division A of P.L. 116-136.

AB1038,28 Section 28 . 71.42 (2) (L) 3. of the statutes is amended to read:

AB1038,27,18 71.42 (2) (L) 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 1106, 2202, 2203, 2204, 2205, 2206, 2307, 3608, 3609, 3701, and 3702 of division A of P.L. 116-136.

AB1038,29 Section 29 . 71.98 (3) of the statutes is amended to read:

AB1038,28,3 71.98 (3) Depreciation, depletion, and amortization. For taxable years beginning after December 31, 2013, and for purposes of computing depreciation and amortization, the Internal Revenue Code means the federal Internal Revenue Code in effect for federal purposes on January 1, 2014, except that sections 13201 (f), 13203, 13204, and 13205 of P.L. 115-97 and section 2307 of division A of P.L. 116-136 apply at the same time as for federal purposes. For taxable years beginning after December 31, 2013, and for purposes of computing depletion, the Internal Revenue Code means the federal Internal Revenue Code in effect for federal purposes for the year in which the property is placed in service.

AB1038,30 Section 30 . 74.35 (5) (c) of the statutes is amended to read:

AB1038,28,9 74.35 (5) (c) No claim may be filed or maintained under this section unless the tax for which the claim is filed, or any authorized installment payment of the tax, is timely paid under s. 74.11, 74.12 or 74.87. This paragraph does not apply to taxes due and payable in 2020 if paid by October 1, 2020, or by any installment date for which taxes are due after October 1, 2020.

AB1038,31 Section 31 . 74.37 (4) (b) of the statutes is amended to read:

AB1038,28,15 74.37 (4) (b) No claim or action for an excessive assessment may be brought or maintained under this section unless the tax for which the claim is filed, or any authorized installment of the tax, is timely paid under s. 74.11 or 74.12. This paragraph does not apply to taxes due and payable in 2020 if paid by October 1, 2020, or by any installment date for which taxes are due after October 1, 2020.

AB1038,32 Section 32 . 100.307 of the statutes is created to read:

AB1038,28,18 100.307 Returns during emergency; prohibition. (1) Definitions. In this section:

AB1038,28,19 (a) “Food product” has the meaning given in s. 93.01 (6).

AB1038,28,20 (b) “Personal care product” has the meaning given in s. 299.50 (1) (b).

AB1038,29,2 (2) Certain returns prohibited during emergency. Except as provided in sub. (3), no person who sells food products, personal care products, cleaning products, or paper products at retail may accept a return of a food product, personal care product, cleaning product, or paper product during the public health emergency declared on March 12, 2020, by executive order 72, or during the 30 days immediately after the public health emergency ends.