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SB794,8,85 71.77 (7) (c) When an election is made under s. 71.745 (9), with respect to
6assessments of a tax or an assessment to recover all or part of any tax credit under
7this chapter in any calendar year or corresponding fiscal year, if notice of assessment
8is given to pass-through members within one year from the date of the election.
SB794,9 9Section 9. 71.775 (1) (intro.) and (a) of the statutes are consolidated,
10renumbered 71.775 (1) and amended to read:
SB794,8,1411 71.775 (1) Definitions. In this section: (a) “Nonresident" “nonresident”
12includes an individual who is not domiciled in this state; a partnership, limited
13liability company, or corporation whose commercial domicile is outside the state; and
14an estate or a trust that is a nonresident under s. 71.14 (1) to (3m).
SB794,10 15Section 10. 71.775 (1) (b) of the statutes is repealed.
SB794,11 16Section 11. 71.78 (1) of the statutes is amended to read:
SB794,9,1017 71.78 (1) Divulging information. Except as provided in subs. (4), (4m) and,
18(10), and (11), no person may divulge or circulate or offer to obtain, divulge, or
19circulate any information derived from an income, franchise, withholding, fiduciary,
20partnership, or limited liability company tax return or tax credit claim, including
21information which may be furnished by the department as provided in this section.
22This subsection does not prohibit publication by any newspaper of information
23lawfully derived from such returns or claims for purposes of argument or prohibit
24any public speaker from referring to such information in any address. This
25subsection does not prohibit the department from publishing statistics classified so

1as not to disclose the identity of particular returns, or claims or reports and the items
2thereof. This subsection does not prohibit employees or agents of the department of
3revenue from offering or submitting any return, including joint returns of a spouse
4or former spouse, separate returns of a spouse, individual returns of a spouse or
5former spouse, and combined individual income tax returns, or from offering or
6submitting any claim, schedule, exhibit, writing, or audit report or a copy of, and any
7information derived from, any of those documents as evidence into the record of any
8contested matter involving the department in proceedings or litigation on state tax
9matters if, in the department's judgment, that evidence has reasonable probative
10value.
SB794,12 11Section 12. 71.78 (11) of the statutes is created to read:
SB794,9,1512 71.78 (11) Pass-through entity audits. If the department audits a
13pass-through entity for income or franchise taxes of its pass-through members,
14including when an election is made under s. 71.21 (6) (a) or 71.365 (4m) (a) to pay tax
15at the entity level, the department may disclose the following:
SB794,9,2016 (a) To a pass-through member that the pass-through entity is under audit or
17was audited, if the disclosure is necessary to explain any amounts assessed or
18refunded to the pass-through member or to obtain information necessary to
19determine the proper amount of adjustment to make at the pass-through entity
20level.
SB794,9,2421 (b) To a pass-through entity, the identities of one or more pass-through
22members who have failed to report pass-through items originating with the entity
23on their Wisconsin returns, if the disclosure is necessary to explain any amounts
24assessed or refunded to the pass-through member or to obtain information about a

1pass-through member's return in order to determine the proper amount of
2adjustment to make at the pass-through entity level.
SB794,13 3Section 13. 71.80 (26) of the statutes is created to read:
SB794,10,184 71.80 (26) Pass-through entity representative. (a) Each pass-through entity
5shall designate, in the manner prescribed by the department, a pass-through
6member or other person with substantial presence in the United States as the
7representative of the pass-through entity. In the case in which such designation is
8not in effect, the pass-through entity shall appoint a representative within 60 days
9following a written request by the department. If the pass-through entity fails to
10appoint a representative following a written request by the department, the
11department may designate a representative and notify the pass-through entity, or
12the beneficiaries in the case of a closed estate or trust, in writing of the designation.
13The pass-through entity may at any time provide a written statement to the
14department designating a new representative and the department shall accept the
15designation if the statement is signed by an authorized agent of the pass-through
16entity. The representative designated by a pass-through entity under this
17paragraph may be different than the pass-through entity's federal representative or
18authorized agent.
SB794,10,2019 (b) The representative designated under par. (a) shall have the power and duty
20to do all of the following:
SB794,10,2221 1. Act as the sole authority on behalf of the pass-through entity and its
22pass-through members with respect to a determination under s. 71.745.
SB794,10,2423 2. Provide the department sufficient information to identify each pass-through
24member and the capital, profits, and loss interest of each pass-through member.
SB794,11,2
13. Enter into extension agreements on behalf of the pass-through entity under
2s. 71.77 (5).
SB794,11,33 4. Receive notices of pass-through entity adjustments under this chapter.
SB794,11,74 5. Notify all pass-through members of their share of corrections and
5adjustments made to pass-through items within 60 days after a determination
6under s. 71.745 becomes final or after receipt of notice of approval under s. 71.76 (2)
7(b).
SB794,11,98 6. File appeals of notices of pass-through entity adjustments under this
9chapter.
SB794,11,1110 7. Enter into settlement agreements and bind pass-through members to
11adjustments relating to pass-through items.
SB794,11,1312 (c) The representative designated under par. (a) may delegate the powers and
13duties under par. (b) to an authorized agent of the pass-through entity.
SB794,14 14Section 14. 71.83 (1) (a) 12. of the statutes is created to read:
SB794,11,2115 71.83 (1) (a) 12. `Incomplete or incorrect pass-through entity return' If any
16pass-through entity, as defined in s. 71.738 (3d), required to file a return under this
17chapter files an incomplete or incorrect return, the department, upon a showing by
18the department under s. 73.16 (4), may assess the pass-through entity an amount
19equal to 25 percent of the amount of the tax assessed under s. 71.745. The amount
20shall be assessed, levied, and collected in the same manner as additional normal
21income or franchise taxes.
SB794,15 22Section 15. 71.88 of the statutes is amended to read:
SB794,12,9 2371.88 Time for filing an appeal. (1) Appeal to the department of revenue.
24(a) Contested assessments and claims for refund. Except for refunds set off under
25s. 71.93 in respect to which appeal is to the agency to which the debt is owed, except

1for refunds set off under s. 71.935 in respect to which an appeal is held under
2procedures that the department of revenue establishes and except for refunds set off
3under s. 49.855 in respect to which a hearing is held before the circuit court, and
4except as provided in s. 71.745 (6),
any person feeling aggrieved by a notice of
5additional assessment, refund, or notice of denial of refund may, within 60 days after
6receipt of the notice, petition the department of revenue for redetermination. A
7petition or an appeal by one spouse is a petition or an appeal by both spouses. The
8department shall make a redetermination on the petition within 6 months after it
9is filed.
SB794,12,1610 (b) Contested adjustments to credits. Any Except as provided in s. 71.745 (6),
11any
person feeling aggrieved by the determination made by the department to adjust
12a credit claimed under s. 71.07, 71.28 or 71.47 or subch. VIII or IX may, within 60 days
13after receipt, petition the department for redetermination. The department shall
14make a redetermination on the petition within 6 months after it is filed and notify
15the claimant under s. 71.74 (11). If no timely petition for redetermination is filed
16with the department, its determination shall be final and conclusive.
SB794,12,25 17(2) Appeal to the Wisconsin tax appeals commission. (a) Appeal of the
18department's redetermination of assessments and claims for refund.
A person feeling
19aggrieved by the department's redetermination, including a pass-through entity
20that has been issued a redetermination under s. 71.745 (6) (b),
may appeal to the tax
21appeals commission by filing a petition with the clerk of the commission as provided
22by law and the rules of practice promulgated by the commission. If a petition is not
23filed with the commission within the time provided in s. 73.01 or, except as provided
24in s. 71.75 (5), if no petition for redetermination is made within the time provided the
25assessment, refund, or denial of refund shall be final and conclusive.
SB794,13,11
1(b) Appeal of department's redetermination of credits. Any person aggrieved by
2the department of revenue's redetermination, including a pass-through entity that
3has been issued a redetermination under s. 71.745 (6) (b),
of a credit under s. 71.07
4(3m), (6), or (9e), 71.28 (1) or (2m) or 71.47 (1) or (2m) or subch. VIII or IX, except when
5the denial is based upon late filing of claim for credit or is based upon a
6redetermination under s. 71.55 (8) of rent constituting property taxes accrued as at
7arm's length, may appeal the redetermination to the tax appeals commission by
8filing a petition with the commission within 60 days after the redetermination, as
9provided under s. 73.01 (5) with respect to income or franchise tax cases, and review
10of the commission's decision may be had under s. 73.015. For appeals brought under
11this paragraph, the filing fee required under s. 73.01 (5) (a) does not apply.
SB794,16 12Section 16. 73.16 (4) of the statutes is amended to read:
SB794,13,1813 73.16 (4) Negligence determinations. The department shall not impose a
14penalty on a taxpayer under ss. 71.09 (11) (d), 71.83 (1) (a) 1. to 4. and 12. and (3) (a),
1576.05 (2), 76.14, 76.28 (6) (b), 76.39 (3), 76.645 (2), 77.60 (2) (intro.), (3), and (4), 78.68
16(3) and (4), and 139.25 (3) and (4), unless the department shows that the taxpayer's
17action or inaction was due to the taxpayer's willful neglect and not to reasonable
18cause.
SB794,13,1919 (End)
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