g. Chapter Tax 11 – Sales and Use Tax Section Tax 11.32: Remove reference to Form S-218 as this form is discontinued because it was duplicative of Form S-213. Section Tax 11.63: Update rule to reflect that radio or television stations may be required to collect Wisconsin sales tax if they are a marketplace provider, as provided in 2019 Wisconsin Act 10. Section Tax 11.66: Remove reference to internet access services as such services are no longer taxable after June 30, 2020, as a result of 2017 Wisconsin Act 59. Section Tax 11.67: Remove note relating to ruling requests for whether a specific transaction is a sale of a prototype or a research and development service with the prototype transferred incidental to the research and development service as they are no longer received. Any taxpayer can submit a request for ruling as described in the department's Publication 111, How to Get a Private Letter Ruling. Section Tax 11.68: Remove references to stadium tax as baseball stadium taxes ended March 31, 2020, as provided in 2019 Wisconsin Act 28, and repeal s. Tax 11.68 (4) (fm) as the exemption for sports and entertainment arena facilities no longer applies after July 31, 2019, which is one year after the Secretary of Administration issued certification. h. Chapter Tax 14 – Homestead Credit Section Tax 14.03: Update rule to reflect repeal of sec. 46.27, Stats., in 2019 Wisconsin Act 9. Rule will be updated to reference sec. 46.27, 2017 Stats. Summary of, and comparison with, existing or proposed federal regulation: There is no existing or proposed federal regulation that is intended to address the activities to be regulated by the rule.
Comparison with rules in adjacent states: Rules in adjacent states would not impact the changes in this proposed rule order.
Summary of factual data and analytical methodologies: No data analysis was used in the preparation of this proposed rule order.
Analysis and supporting documents used to determine effect on small business:
Applicants for fuel tax licenses (sec. Tax 4.54):
—Increase the dollar threshold for when the department must describe the reasons for requiring security before obtaining a fuel tax license. The current rule provides that the department must describe the reasons for requiring security if the security is over $100. Current rule also provides that the security amount is equal to the average quarterly fuel tax liability, increased to the next $100. Most fuel tax license applicants have over $1,000 quarterly tax liability. It is anticipated that raising the threshold to $1,000 will not alleviate the department from describing the reasons for requiring security for most applicants.
—Eliminate certificates of deposit as a form of security. Certificates of Deposit (CD's) are not an acceptable form of security because an investor may redeem a CD by presenting the account number and their driver's license to the financial institution. The department could be left holding an original CD that has no value. In addition, the department has not accepted such form of security for license applicants since September 30, 2019.
Anticipated costs incurred by private sector: This proposed rule does not have a fiscal effect on the private sector.
Effect on small business: This rule order primarily makes changes to reflect current law and administration. However, the changes to sec. Tax 4.54 may affect applicants for a fuel tax license. See the description in the analysis above.
Agency contact person: Please contact Jen Olson at (608) 266-8253 or jennifer.olson@wisconsin.gov, if you have any questions regarding this proposed rule. Place where comments are to be submitted and deadline for submission: Comments may be submitted to the contact person shown below no later than the date on which the public hearing on this proposed rule is conducted. Information as to the place, date, and time of the public hearing will be published in the Wisconsin Administrative Register.
Jen Olson
Department of Revenue
Mail Stop 6-40
2135 Rimrock Road
P.O. Box 8933
Madison, WI 53708-8933
SECTION 1. Tax 1.06 is amended to read:
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 or Wisconsin minimum tax or alternative minimum 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.
SECTION 2. Tax 1.13 (1) (b) is amended to read:
Tax 1.13 (1) (b) The power of attorney requirement applies to income, franchise, alternative minimum, withholding, sales and use, county sales and use, estate, motor fuel, general aviation fuel, special fuel, fermented malt beverage, intoxicating liquor, cigarette and tobacco products tax matters of individuals, partnerships and corporations, including (S) corporations, and homestead and farmland preservation credit matters, and unclaimed property matters.
SECTION 3. Tax 2.02 (11) (a) (Note) is created to read:
SECTION 4. Tax 2.085 (1) is repealed and recreated to read:
Tax 2.085 (1) If a claimant is filing a deceased taxpayer's income tax return and is due a refund, the claimant shall file Form 804, "Claim for Decedent's Wisconsin Income Tax Refund," with the income tax return. If the claimant did not file Form 804 with the income tax return, a refund check is issued in the deceased taxpayer's name. If the claimant is unable to cash the refund check, the claimant shall file Form 804.
SECTION 5. Tax 2.085 (3) is amended to read:
Tax 2.085 (3) Forms required to be filed under sub. (1) shall be mailed to Wisconsin Department of Revenue, Tax Operations Bureau — Mail Stop 3−164, P.O. Box 8903, Madison, WI 53708−8903.
SECTION 6. Tax 2.67 (2) (c) 4. is amended to read:
Tax 2.67 (2) (c) 4. If the combined group is using apportionment, one Form A−1, Apportionment Data for Single Factor Formulas, or Form A−2, Apportionment Data for Multiple Factor Formulas one of the following forms, per member as applicable.:
a. Schedule A-01, Wisconsin Single Sales Factor Apportionment Data for Nonspecialized Industries.
b. Schedule A-02, Wisconsin Apportionment Percentage for Interstate Financial Institutions.
c. Schedule A-03, Wisconsin Apportionment Percentage for Interstate Motor Carriers.
d. Schedule A-04, Wisconsin Apportionment Percentage for Interstate Telecommunications Companies.
e. Schedule A-05, Wisconsin Premium Factor for Insurance Companies.
f. Schedule A-06, Wisconsin Receipts Factor for Interstate Brokers-Dealers, Investment Advisors, Investment Companies, and Underwriters.
g. Schedule A-07, Wisconsin Apportionment Percentage for Interstate Air Carriers.
h. Schedule A-08, Wisconsin Apportionment Percentage for Broadcasters.
i. Schedule A-09, Wisconsin Apportionment Percentage for Interstate Railroads.
j. Schedule A-10, Wisconsin Apportionment Percentage for Interstate Pipeline Companies.
k. Schedule A-11, Wisconsin Apportionment Percentage for Interstate Air Freight Forwarders Affiliated with a Direct Air Carrier.
SECTION 7. Tax 2.92 (1) is repealed and recreated to read:
Tax 2.92 (1) An employee is required to provide a completed Form WT-4, "Employee's Withholding Exemption Certificate/New Hire Reporting," to their employer.
SECTION 8. Tax 2.92 (2) is amended to read:
Tax 2.92 (2) An employee who had incurred no Wisconsin income tax liability for the preceding taxable year and anticipates no liability for a current taxable year shall be exempt from withholding if the employee provides his or her employer with a completed form Form WT−4, “Employee’s Wisconsin Withholding Exemption Certificate Certificate/New Hire Reporting” which shows a claim for total exemption. For this purpose, a tax liability is “incurred” if the employee had for the preceding year, or anticipates for the current year, a net Wisconsin income tax due, i.e., gross tax less personal exemptions on a Wisconsin return. If an employee is married, the Wisconsin marital property laws for tax computation shall be considered in determining if the employee may claim this exemption.
SECTION 9. Tax 2.99 is repealed.
SECTION 10. Tax 4.001 (2) (c) 1. (Note) is amended to read:
SECTION 11. Tax 4.53 (3) (Note 1) is repealed.
SECTION 12. Tax 4.54 (2) (c) is amended to read:
Tax 4.54 (2) (c) In instances in which the department determines security in excess of $100 $1,000 is required, notification of this requirement shall include a written statement clearly describing the reasons for the requirement and a description or calculation showing how the amount of the security requirement was determined.
SECTION 13. Tax 4.54 (3) (intro.) and (a) are consolidated, renumbered Tax 4.54 (3) and amended to read:
Tax 4.54 (3) TYPES OF SECURITY. Acceptable types of security include, but are not limited to: (a) Noninterest−bearing: 1. Cash cash, certified check, or money order. 2., or Surety surety bonds issued by authorized underwriters.
SECTION 14. Tax 4.54 (3) (b) is repealed.
SECTION 15. Tax 7.001 (2) (c) 1. (Note) is amended to read:
SECTION 16. Tax 8.001 (2) (c) 1. (Note) is amended to read:
SECTION 17. Tax 8.03 (2) (Note) is amended to read:
Tax 8.03 (2) Note: Wine collector registrations may be addressed to Wisconsin Department of Revenue, Excise Tax Section Unit — Mail Stop 6−107 5-107, PO Box 8900, Madison, Wisconsin 53708−8900.
SECTION 18. Tax 9.001 (2) (c) 1. (Note) is amended to read:
SECTION 19. Tax 9.70 (Title) and (1) are amended to read:
Tax 9.70 Cigarette, and tobacco, and vapor products tax bad debt deductions. (1) Purpose. This section clarifies when and how a person who pays cigarette taxes or a distributor who pays tobacco and vapor taxes may claim a deduction under ss. 139.362 and 139.801, Stats., for cigarette, and tobacco, and vapor products tax attributable to bad debt. SECTION 20. Tax 9.70 (2) (e) is created to read:
Tax 9.70 (2) (e) "Vapor product" has the meaning given in s. 139.75 (14), Stats. SECTION 21. Tax 9.70 (3) (a), (c), (d), (e), and (f) are amended to read:
Tax 9.70 (3) (a) Deduction from measure of tax. Using form Form CT−117, titled “Cigarette Distributor Bad Debt Deduction for Uncollectible Wisconsin Cigarette Tax,” or form Form TT−117, titled “Tobacco and Vapor Products Distributor Bad Debt Deduction for Uncollectible Wisconsin Tobacco Products Tax,” a person who pays cigarette taxes or a distributor who pays tobacco and vapor products taxes may claim a deduction on the monthly tax report for the cigarette, and tobacco, and vapor products tax attributable to bad debt that is written off as uncollectible in their books and records and that is eligible to be deducted as bad debt under s. 166 of the internal revenue code Internal Revenue Code.
(c) Recovery of bad debt. If a person who pays cigarette taxes or a distributor who pays tobacco and vapor products taxes subsequently collects in whole or in part any bad debt for which a deduction is claimed under par. (a), they shall include the amount collected in the monthly tax report filed for the month in which the amount is collected and shall pay the tax with the report.
(d) Payments and credits. Payments and credits applied to a debt before it is written off as uncollectible shall be apportioned to the amount of such debt attributable to cigarette or tobacco and vapor products tax on the basis of the ratio of the cigarette or tobacco and vapor products tax to be paid per the invoice to the total amount to be paid per the invoice. The amount so apportioned shall reduce the amount of debt attributable to cigarette or tobacco and vapor products tax to arrive at the deduction under par. (a).
(e) Tax rate change. If the deduction under par. (a) is claimed for a month when the cigarette or tobacco products or vapor products tax rate is different from the tax rate in effect when the cigarettes, or tobacco or vapor products were sold, the tax rate in effect when the cigarettes, or tobacco or vapor products were sold shall be used to determine the amount of the deduction.
(f) Illegal sales. No deduction under par. (a) shall be allowed for cigarette, and tobacco, and vapor products tax attributable to bad debt incurred on sales of cigarettes, or tobacco, or vapor products sold in violation of state or federal law.
SECTION 22. Tax 11.001 (1) is amended to read:
Tax 11.001 (1) Applicability. Chapter Tax 11 is applicable to the state sales and use taxes imposed under subch. III of ch. 77, Stats., and is also applicable to the county and stadium sales and use taxes taxes authorized under subch. V of ch. 77, Stats. SECTION 23. Tax 11.001 (2) (d) is repealed.
