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PROPOSED ORDER OF THE DEPARTMENT OF REVENUE REPEALING, AMENDING, AND CREATING RULES
The Wisconsin Department of Revenue proposes an order to: repeal Tax 1.13 (3) (a) and (b), 1.17, 2.32 (2) (a) 7. (Note), 2.395, 2.61 (7) (h) 1. and 2., 2.92 (3) (e) (Note 1), 2.98 (2) (b) (Note 1), (Note 2), and (Note 3), and 14.03 (4) (b) 23.;amend Tax 1.12 (9) (a) 1. (Note), 1.13 (1) (b) and (4) (a) and (b), 2.01, 2.03 (3) (b) 2. a. (Note), 2.04 (2) (d) (Note) and (dm) 1. (Note), (3), (4) (c) and (e), (5), (6) (a), (b), and (c) 1. (Note), (7), and (8) (b) 1. (Note) and (c) 2. (Note), 2.07 (2) (g) (Note), 2.08 (3) (b), (d) 1. (Note), and (e) 2. (Note), 2.105 (4) (b), 2.12 (3) (c), 2.30 (2) (Example), 2.32 (2) (a) 1., 2., 3., 4., 5., and 6., (b) 1., 2., 3., 4., 5., 6., 7., and 8., (c) 1., 2., 3., 4., 5., and 6., and (d) 1., 2., 3., 4., 5., and 6., 2.39 (6) (f) and (h), 2.49 (2) (hm) and (4) (x) 1. b. and c., 2.61 (4) (b) 1. and 4., (6) (a) 3., and (7) (h), 2.62 (2) (d) 1., 2.64 (2) (b) 7., (c), and (e) 3., 2.67 (2) (b) 2. (Note), 2.87 (1) (a), 2.88 (3) (a) and (5) (Note 4), 2.89 (4) (b), (c), and (d), 2.935 (1) (a), 2.95 (5) (Example), 2.955 (2) (a) and (b), (4) (intro), (b) 2. and 3., (c), and (d), and (5) (Example), and 2.96 (1) (a); and create Tax 1.13 (4) (c), 2.08 (3) (ci), 2.88 (3) (d), 2.955 (2m), 14.01 (2) (am), and 14.03 (4) (c) 10.; relating to income and franchise tax provisions.
The scope statement for this rule, SS 103-18, was approved by the Governor on August 27, 2018, published in Register No. 753A1 on September 4, 2018, and approved by the Secretary of Revenue on September 20, 2018.
Analysis by the Department of Revenue
Statutes interpreted: Tax 1.12 ss. 71.01 (8r), 71.255 (7) (b), 71.42 (3m), 71.63 (1m) and (5m), 71.65 (3) (a), 73.029, 77.58 (1m), 77.61 (14, 77.96 (5m), 78.12 (5), 78.55 (5m), 139.01 (5m), 139.30 (8m), and 139.75 (5m), Stats.
Tax 1.17 – s. 146.98, Stats.
Tax 2.01 – s. 71.02, Stats.
Tax 2.03 – ss. 71.24 (1), (1m), and (3), 71.255 (1) (b) and (7), 71.365 (4) and (5), 71.44 (1) (a) and (c) and (1m), and 71.80 (18), Stats.
Tax 2.07 – ss. 71.07 (9e) and 73.03 (48), Stats.
Tax 2.08 – ss. 71.01 (5g), 71.03 (2), 71.20 (1), 71.55 (3), 71.738 (2m), and 71.80 (18), Stats.
Tax 2.105 – ss. 71.255 (1) and (7), 71.75 (2), 71.76, 71.77 (2) and (7), and 77.96 (4), Stats.
Tax 2.12 – ss. 71.255 (1), (4), and (7), 71.30 (4), 71.738 (2m), 71.74, 71.75, 71.76, 71.77, 71.80 (18), and 77.96 (4), Stats.
Tax 2.30 – ss. 71.05 (12) (a), (b), and (c), (15), (16), (17), and (18) and 71.04 (1) (a), Stats.
Tax 2.32subch. VII of ch. 77, Stats.
Tax 2.39 – ss. 71.04 (4), (4m), (5), (6), (7), (10), and (11), 71.25 (5), (6), (6m), (7), (8), (9), (11), and (15), and 71.255 (5), Stats.
Tax 2.395 – s. 71.25 (14), Stats.
Tax 2.49 – ss. 71.04 (4) (e), (8) (c), and (11) and 71.25 (6) (e), (10) (c), and (12)
Tax 2.61 – s. 71.255, Stats.
Tax 2.62 – s. 71.255 (1) (n), Stats.
Tax 2.64 – s. 71.255 (5) (b), Stats.
Tax 2.67 – ss. 71.24 (1), (1m), and (7), 71.255 (1) (b), (7) (b), (8), and (9), 71.44 (1), (1m), and (3), 71.77, 71.82, and 71.83, Stats.
Tax 2.87 – ss. 71.255 (7) (b) and 71.82 (2) (b), Stats.
Tax 2.89 – ss. 71.09 (9), 71.255 (7), and 71.29 (5), Stats.
Tax 2.92 – ss. 71.66 and 71.83 (1) (a) 5. and (b) 4. and (2) (a) 5., Stats.
Tax 2.935 – s. 71.82 (2) (d), Stats.
Tax 2.95 – ss. 71.01 (6) and 71.04 (1) (a), Stats.
Tax 2.955 s. 71.07 (7), Stats.
Tax 2.96 – ss. 71.24 (7), 71.255 (7), and 71.44 (3), Stats.
Tax 2.98 – ss. 71.01 (6), 71.22 (4), and 71.255 (7) (b), Stats.
Tax 14.01 – s. 71.52 (1d), Stats.
Tax 14.03 – s. 71.52 (5) and (6), Stats.
Statutory authority: ss. 71.05 (7) (g) 2., 71.25 (9) (g) 2., 71.80 (1) (c), and 227.11 (2) (a), Stats.
Explanation of agency authority: Under ss. 71.05 (7) (g) 2., and 71.25 (9) (g) 2., Stats., the department may promulgate rules relating to situs of income; allocation and apportionment.
Under s. 71.80 (1) (c), Stats., the department may make such regulations as it shall deem necessary in order to carry out chapter 71 of the Wisconsin Statutes, relating to income and franchise taxes.
Section 227.11 (2) (a), Stats., provides “[e]ach agency may promulgate rules interpreting the provisions of any statute enforced or administered by the agency, if the agency considers it necessary to effectuate the purpose of the statute...”
Related statute or rule: There are no other applicable statutes or rules.
  Plain language analysis: Due to various Wisconsin acts and other technical corrections, updates to Chapters Tax 1, 2, and 14 are needed relating to the following:
- Update email and website addresses.
- Update procedures relating to a revised power of attorney form and to add Streamlined Sales Tax Form F0023 as an alternate form available.
- Reflect the repeal of sec. 146.98, Stats., as a result of 2017 Wis. Act 59 related to the ambulatory surgical center assessment.
- Remove reference to an obsolete form.
- Update due dates of forms for rents and royalties and electronic filing requirements as changed -in secs. 71.70 and 71.80, Stats., as a result of 2017 Wis. Act 59.
- Update the address for where to file forms and remove a reference to "Tax Return Guidelines."
- Change the extension period to 30 days per sec. 71.73, Stats., as a result of 2017 Wis. Act 59.
- Update when an information return should be filed with Wisconsin.
- Update an obsolete reference to the health insurance credit for purposes of claiming the earned income credit.
- Include Form PW-1 in the list of returns that are required to be filed electronically. This form is filed by trusts, partnerships, and tax-option (S) corporations that are required to withhold tax on Wisconsin income that must be reported by nonresidents.  Section 71.738(2m), Wis. Stats., provides the authority for the department to prescribe the method for filing returns with the department.  The requirement to electronically file started in 2018, as described in Wisconsin Tax Bulletin 200.
- Reference statutory limitations, as stated in sec. 71.80 (25), Stats., related to net business and net operating losses as reflected in 2017 Wis. Act 59.
- Update date references to the Internal Revenue Code (IRC).
- Remove line references to forms.
- Include exception for broadcaster's gross receipts and updating sourcing of sales of services as provided in secs. 71.04 (7) and 71.25 (9), Stats., as a result of 2017 Wis. Act 59, and to correct a reference.
- Repeal s. Tax 2.395 as the alternative method of apportionment was only available prior to January 1, 2000.
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