Chapter Tax 1

Tax 1.01(4)(b)4. 4. Racine

Tax 1.01(4)(b)5. 5. Walworth

Tax 1.01(4)(b)6. 6. Washington

Tax 1.01(4)(b)7. 7. Waukesha

Tax 1.01 Note Note: Section Tax 1.01 interprets s. 73.05, Stats.

Tax 1.01 History History: 1-2-56; am. Register, September, 1964, No. 105, eff. 10-1-64; am. Register, February, 1975, No. 230, eff. 3-1-75; am. Register, September, 1983, No. 333, eff. 10-1-83.

Tax 1.06 Tax 1.06 Application of federal income tax regulations. To the extent that any provision of the internal revenue code has application in the determination of Wisconsin taxable income, Wisconsin net income, or Wisconsin income or franchise tax of any natural person, fiduciary or corporation, including tax-option (S) corporations, any United States treasury regulation interpreting the provision shall be deemed a tax rule of the Wisconsin Administrative Code.

Tax 1.06 Note Note: Federalization of the computation of Wisconsin gross income for individuals and fiduciaries was provided by Chapter 163, Laws of 1965, effective for taxable year 1965 and thereafter. Federalization of the computation of Wisconsin net income of a corporation was provided by 1987 Wis. Act 27, effective for taxable year 1987 and thereafter.

Tax 1.06 History History: Cr. Register, March, 1966, No. 123, eff. 4-1-66; am. Register, July, 1987, No. 379, eff. 8-1-87; am Register, June, 1990, No. 414, eff. 7-1-90; CR 22-044: am. Register June 2023 No. 810, eff. 7-1-23.

Tax 1.10 Tax 1.10 Depository bank requirements for estimated tax vouchers, sales and use tax returns, and withholding, motor fuel, general aviation fuel and alternate fuels tax deposit reports.

Tax 1.10(1) (1) Daily processing of documents. Screening and processing of deposit reports, returns, and vouchers shall be done daily on the date received in accordance with specific procedures provided by the department.

Tax 1.10(2) (2) Documents received with proper payment. The depository bank shall inscribe the date received, amount of payment and a consecutively assigned validation number upon each deposit report, return, or voucher. That same information shall be inscribed on the payment. The deposits received and validated for each day shall be combined into a single deposit to the account of the state treasurer. The processed documents shall be kept in sequence within batches for each business day. The batches for each business day shall be sent daily by special courier to the department’s revenue accounting section in Madison. A validation tape and batch card shall accompany each batch, and each day’s transmittal shall include a separate recapitulation sheet for each tax program. A copy of the combined daily deposit slip shall also be included in each day’s transmittal.

Tax 1.10(3) (3) Exceptions. Non-processible documents or remittances, or both, as described in writing to the depository bank by the department’s revenue accounting section, shall be exceptions to the treatment provided in sub. (1) and shall not be validated. Instead, they shall be sent to the department’s revenue accounting section with the envelopes in which they were received.

Tax 1.10 Note Note: Section Tax 1.10 interprets s. 71.65 (3) (a), Stats.

Tax 1.10 History History: Cr. Register, March, 1975, No. 231, eff. 4-1-75; am. (1) (a) and (b) 4. and (2), Register, September, 1983, No. 333, eff. 10-1-83; renum. (1) and (2) to be (2) and (3) and am. (2) (a), cr. (1), Register, July, 1987, No. 379, eff. 8-1-87; am. (1), (2) (a) and (3), r. (2) (b), Register, June, 1990, No. 414, eff. 7-1-90; CR 21-085: am. (title) Register August 2022 No. 800, eff. 9-1-22.

Tax 1.11 Tax 1.11 Requirements for examination of returns.

Tax 1.11(1) (1) Public officer defined. In this section, “public officer” means any person appointed or elected according to law, who has continuous duties, has taken an oath of office and who is responsible for the exercise of some portion of the sovereign power of this state, another state or the United States, in which the public has a concern. One, but not the sole, indicium of responsibility for exercising the sovereign power is the authority to make final policy with regard to those duties of a public officer requiring access to tax files under this section.

Tax 1.11(2) (2) General. The provisions of ss. 70.375 (2) (b), 71.78, 72.06, 77.61 (5), 77.76 (3), 77.79, 78.80 (3) and (4), 139.11 (4), 139.38 (6), and 139.82 (6), Stats., apply to the examination of mining net proceeds, income, franchise, fiduciary, partnership, estate, sales and use, county sales and use, withholding, motor fuel, general aviation fuel, alternate fuels, fermented malt beverage, distilled spirits and wine, cigarette and tobacco product tax returns and tax credit claims. No person may examine or receive information from a tax return or tax credit claim unless specifically authorized to do so by the appropriate statute.

Tax 1.11(3) (3) Persons who may examine returns.

Tax 1.11(3)(a) (a) Public officers of the federal government or other state governments. No information may be divulged to a public officer of the federal government or another state government or the authorized agents of the officer under the provisions specified in sub. (2) unless the information requested is necessary in the administration of the tax laws of the government; the government accords similar rights of examination or information to the Wisconsin department of revenue; the government has entered into an agreement with the department for the disclosure or exchange of information; and the public officer first complies with all of the following:

Tax 1.11(3)(a)1. 1. Specifies in writing the purpose for each requested examination, the statutory or other authority showing the duties of the office and the relation of the purpose to the duties of the office.

Tax 1.11(3)(a)2. 2. Specifies in writing the name, address and title of the agent authorized to examine tax returns.

Tax 1.11(3)(a)3. 3. Provides evidence that he or she is a public officer.

Tax 1.11(3)(b) (b) Members of the joint, senate or assembly committee on legislative organization.

Tax 1.11(3)(b)1. 1. No information may be divulged to members of the joint committee on legislative organization, senate committee on organization or assembly committee on organization, or to any agent of these committees under the provisions specified in sub. (2) unless all of the following requirements are first complied with:

Tax 1.11(3)(b)1.a. a. Specification in writing of the purpose for each requested examination and the relation of the purpose to the official duties of the committee requesting the examination of tax returns.

Tax 1.11(3)(b)1.b. b. Specification in writing of the name, address and title of the committee member or agent authorized to examine tax returns.

Tax 1.11(3)(b)1.c. c. Certification by the chairperson of the committee that the committee, by a majority vote of a quorum of its members, has approved the requested examination of tax returns by the committee member or agent.

Tax 1.11(3)(b)2. 2. Sales and use tax returns may not be examined by the joint committee on legislative organization.

Tax 1.11(3)(c) (c) Attorney general or department of justice employees. No information may be divulged to the attorney general or department of justice employees under the provisions specified in sub. (2) unless all of the following requirements are first complied with:

Tax 1.11(3)(c)1. 1. The attorney general shall specify in writing the purpose for each requested examination, the statutory authority or other authority showing the duties of the office and the relation of the purpose to the duties of the office.

Tax 1.11(3)(c)2. 2. Each requested examination by a department of justice employee shall include the data in par. (c) 1. and an authorization identifying the employee by name, address and title. The authorization shall be signed and approved by the attorney general on whose behalf the department of justice employee is acting.

Tax 1.11(3)(d) (d) District attorneys. No information may be divulged to district attorneys under the provisions specified in sub. (2) unless the following requirements are first complied with:

Tax 1.11(3)(d)1. 1. The tax information to be examined by the district attorney is for use in preparation for a judicial proceeding or an investigation which may result in a judicial proceeding involving any of the taxes or tax credits referred to in sub. (2) and one of the following applies:

Tax 1.11(3)(d)1.a. a. The taxpayer is or may be a party to the proceeding.

Tax 1.11(3)(d)1.b. b. The treatment of an item reflected in the tax information is or may be related to the resolution of an issue in the proceeding or investigation.

Tax 1.11(3)(d)1.c. c. The tax information relates or may relate to a transactional relationship between the taxpayer and a person who is or may be a party to the proceeding which affects or may affect the resolution of an issue in the proceeding or investigation.

Tax 1.11(3)(d)2. 2. If the department allows examination of information under subd. 1. then all of the following apply:

Tax 1.11(3)(d)2.a. a. The department may make disclosure on its own motion if the department has referred the case to a district attorney.

Tax 1.11(3)(d)2.b. b. The department may allow the examination of information requested and the information may be examined and used solely for the proceeding or investigation for which it is requested if a district attorney requests examination of a tax or tax credit information relating to a person, the district attorney specifies in writing the purpose for each requested examination, identifies the requestor, and the person to whom the information relates, the statutory or other authority showing the duties of the office, and the relation of the purpose to the duties of the office.

Tax 1.11(3)(d)3. 3. 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.

Tax 1.11(3)(d)4. 4. 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 all of the following, the department may allow an examination of information under subd. 3.:

Tax 1.11(3)(d)4.a. a. There is reasonable cause to believe, based on information believed to be reliable, that a specific criminal act has been committed;

Tax 1.11(3)(d)4.b. b. 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

Tax 1.11(3)(d)4.c. c. 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.

Tax 1.11(3)(d)5. 5. The department may deny access and shall certify the reason therefor to the court if the department determines the examination of information under subd. 4. would identify a confidential informant or seriously impair a civil or criminal tax investigation.

Tax 1.11(3)(e) (e) Employees of this state. No information may be divulged to employees of this state under the provisions specified in sub. (2) unless all of the following requirements are first complied with:

Tax 1.11(3)(e)1. 1. The public officer of the department, division, bureau, board or commission of this state specifies in writing the purpose for each requested examination, the statutory or other authority showing the duties of the office and the relation of the purpose to the duties of the office, and the name, address and title of the employee of this state authorized to examine returns.

Tax 1.11(3)(e)2. 2. The department of revenue deems the examination necessary for the employee to perform his or her duties under contracts or agreements between the department of revenue and the department, division, bureau, board or commission of this state relating to the administration of tax laws or child support enforcement under s. 49.22, Stats.

Tax 1.11(3)(f) (f) Taxpayers and spouses or former spouses of taxpayers.

Tax 1.11(3)(f)1. 1. No information may be divulged to a taxpayer under the provisions specified in sub. (2) unless the taxpayer, an officer of the taxpayer corporation or the authorized representative of the taxpayer provides appropriate identification.

Tax 1.11(3)(f)2. 2. No income tax information may be divulged to a taxpayer’s spouse or former spouse under the provisions specified in sub. (2) except in the following cases:

Tax 1.11(3)(f)2.a. a. In the case of a joint income tax return, the spouse or former spouse signed the joint return.

Tax 1.11(3)(f)2.b. b. In the case of a separate income tax return, for the 1986 tax year and thereafter, the spouse or former spouse shows that the spouse or former spouse may be liable, or the spouse’s or former spouse’s property is subject to collection, for a delinquency relating to the tax return requested to be examined.

Tax 1.11(3)(g) (g) Persons designated by court order. No information may be divulged to a person designated by a court order under the provisions specified in sub. (2) unless all of the following requirements are first complied with:

Tax 1.11(3)(g)1. 1. The person serves a copy of the court order signed by a judge of a court of record on the custodian of files to produce a return or claim in open court in a court action pending before the judge.

Tax 1.11(3)(g)2. 2. The order recites that the information contained in the tax return requested to be examined is relevant to the pending action for which the order is issued.

Tax 1.11(4) (4) Special situations.

Tax 1.11(4)(a) (a) Board of arbitration. A member of the board of arbitration established under s. 71.10 (7), Stats., or a consultant under joint contract with the states of Minnesota and Wisconsin may examine income tax returns for purposes of determining the reciprocity loss to which either state is entitled.

Tax 1.11(4)(c) (c) Legislative fiscal bureau. Employees of the legislative fiscal bureau, to the extent the department deems the examination necessary to perform their duties under contracts or agreements between the department of revenue and the legislative fiscal bureau relating to the review and analysis of tax policy and state revenue collections, may examine tax returns under the provisions specified in sub. (2).

Tax 1.11(4)(cm) (cm) Legislative audit bureau. 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, Stats., may examine tax returns under the provisions specified in sub. (2).

Tax 1.11(4)(d) (d) Lottery division. The administrator of the lottery may request examination of tax returns for the purpose of withholding delinquent Wisconsin taxes, child support, and other debts owing this state.

Tax 1.11(4)(e) (e) Wisconsin economic development corporation. The chief executive officer of the Wisconsin economic development corporation and employees of the corporation may examine tax returns, except state and county sales and use tax returns, under the provisions specified in sub. (2), to the extent necessary to administer the development zone program under subch. II of ch. 238, Stats.

Tax 1.11(4)(f) (f) Refund setoffs. The department may supply the address of a debtor to an agency certifying a debt of the debtor under the refund setoff provisions of s. 71.93, Stats.

Tax 1.11(4)(g) (g) Successor, guarantor or surety. Any person against whom the department asserts liability under ch. 77, Stats., may examine the related sales and use tax returns.

Tax 1.11(4)(gm) (gm) Material interest in property subject to 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), Stats., may not examine tax returns of the persons subject to the tax warrant, but may obtain the outstanding liability secured by the tax warrant.

Tax 1.11(4)(h) (h) Agreements. The department may, when satisfied that the restrictions imposed under sub. (2) will be adequately safeguarded and a beneficial tax purpose is demonstrated, enter into agreements with governmental officials whereby information is disclosed or exchanged. In these instances, the requirements of this section may be modified in the discretion of the department.

Tax 1.11(5) (5) Form of request.

Tax 1.11(5)(a) (a) With each requested examination under subs. (3) and (4), there shall also be submitted in writing or by other means as approved by the department all of the following:

Tax 1.11(5)(a)1. 1. The name and address of each taxpayer whose return is requested.

Tax 1.11(5)(a)2. 2. The type of tax return or tax credit claim, such as mining net proceeds, income, franchise, homestead credit, or sales and use tax.

Tax 1.11(5)(a)3. 3. The taxable period.

Tax 1.11(5)(a)4. 4. The taxpayer’s social security number, if available, in the case of returns relating to individuals.

Tax 1.11(5)(a)5. 5. In the case of a request by a public officer, a statement indicating that the authorized agent understands the provisions specified in sub. (2) and that any persons who use or permit the use of any information directly or indirectly so obtained beyond the duties imposed upon them by law or by the duties of their office shall be deemed in violation of the provisions specified in sub. (2).

Tax 1.11(5)(b) (b) The information required to be submitted to the department under sub. (5) (a) shall be submitted on forms provided by the department.

Tax 1.11 Note Note: Section Tax 1.11 interprets ss. 70.375 (2) (b), 71.78, 72.06, 77.61 (5), 77.76 (3), 77.79, 78.80 (3) and (4), 139.11 (4), 139.38 (6) and 139.82 (6), Stats.

Tax 1.11 History History: Cr. Register, August, 1975, No. 236, eff. 9-1-75; am. (4) and cr. (5), Register, January, 1976, No. 241, eff. 2-1-76; emerg. cr. (9), eff. 12-31-78; am. (1) (intro.) and (a) and (2), r. (1) (b), renum. (1) (c) to be (1) (b) and am., renum. (3) to (5) to be (6) to (8) and am. (7) and (8), cr. (3) to (5), Register, January, 1979, No. 277, eff. 2-1-79; cr. (9), Register, March, 1979, No. 279, eff. 4-1-79; am. (1) (intro.) and (b), (4) (a), r. (9), Register, July, 1981, No. 307, eff. 8-1-81; am. (1) (b), (2) (c), (3) (c), (4) (a) and (c) and (5) (b), Register, June, 1983, No. 330, eff. 7-1-83; am. (5) (intro.) and (d), Register, September, 1983, No. 333, eff. 10-1-83; r. and recr. Register, January, 1991, No. 421, eff. 2-1-91; correction in (3) (e) made under s. 13.93 (2m) (b) 7., Stats., Register, September, 1999, No. 525; CR 12-011: r. and recr. (4) (e) Register July 2012 No. 679, eff. 8-1-12; CR 13-012: am. (4) (d) Register August 2013 No. 692, eff. 9-1-13; CR 17-019: am. (2), cr. (4) (cm), (gm), am. (5) (a) 2. Register June 2018 No. 750 eff. 7-1-18; CR 21-085: am. (2), renum. (3) (d) 2. to (3) (d) 2. b. and am., cr. (3) (d) 2. (intro.), a., 3. to 5., r. (3) (f) 2. c., am. (3) (g) 1., r. (4) (b), am. (4) (c), (5) (b) Register August 2022 No. 800, eff. 9-1-22.

Tax 1.12 Tax 1.12 Electronic funds transfer.

Tax 1.12(1) (1) Scope. This section applies to any person who is required to or elects to pay or deposit taxes, fees, or other amounts by electronic funds transfer, or “EFT.”

Tax 1.12(2) (2) Purpose. The purpose of this section is to specify which taxes, fees, and other amounts are required to be paid or deposited using the EFT payment method, to provide that certain persons not required to use the EFT payment method may elect to do so and to explain the procedures for using EFT.

Tax 1.12(3) (3) Definitions. In this section:

Tax 1.12(3)(a) (a) “ACH” means automated clearing house, a central clearing facility operated by a federal reserve bank or a private sector organization on behalf of depository financial institutions in which depository financial institutions transmit or receive ACH entries.

Tax 1.12(3)(b) (b) “ACH credit” means the EFT payment option in which the payer initiates the transfer of funds by authorizing the payer’s financial institution to transfer the payment amount to the department’s depository bank.

Tax 1.12(3)(c) (c) “ACH debit” means the EFT payment option in which the payer initiates the transfer of funds by authorizing the department’s depository bank to transfer the payment amount from the payer’s account.

Tax 1.12(3)(cg) (cg) “Combined group” has the meaning given in s. 71.255 (1) (a), Stats.

Tax 1.12(3)(cr) (cr) “Confirmation number” means a character code uniquely identifying the successful completion of an EFT transaction.

Tax 1.12(3)(d) (d) “Electronic funds transfer” or “EFT” means any transfer of funds initiated through a terminal, telephone, or computer authorizing a financial institution to debit or credit an account on the requested settlement date.

Tax 1.12 Note Note: The EFT payment method allows funds to be transferred electronically from the payer’s financial institution to the department’s depository bank eliminating the need to prepare and process a paper check.

Tax 1.12(3)(e) (e) “Entry” means an electronic item representing the transfer of funds in the ACH system.