AB50: Bill Text

AB50,1320 Section 1320. 71.17 (6) of the statutes is amended to read:

AB50,696,23 71.17 (6) Funeral trusts. If a qualified funeral trust makes the election under section 685 of the Internal Revenue Code for federal income tax purposes, that election applies for purposes of this chapter and each trust shall compute its own tax and shall apply the rates under s. 71.06 (1), (1m), (1n), (1p), or (1q), or (1r).

AB50,1321 Section 1321. 71.21 (4) (a) of the statutes is amended to read:

AB50,697,5 71.21 (4) (a) The amount of the credits computed by a partnership under s. 71.07 (2dm), (2dx), (2dy), (3g), (3h), (3n), (3q), (3s), (3t), (3w), (3wm), (3y), (4k), (4n), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), (8m), and (10) and passed through to partners shall be added to the partnership’s income.

AB50,1322 Section 1322. 71.21 (6) (d) 3. of the statutes is amended to read:

AB50,697,8 71.21 (6) (d) 3. Except as provided in s. 71.07 (7) (b) 3. and (9m) (f) 2. a., the tax credits under this chapter may not be claimed by the partnership.

AB50,1323 Section 1323. 71.26 (1) (b) of the statutes is amended to read:

AB50,697,14 71.26 (1) (b) Political units. Income received by the United States, the state and all counties, cities, villages, towns, school districts, technical college districts, joint local water authorities created under s. 66.0823, transit authorities created under s. 66.1039, long-term care districts under s. 46.2895 or other political units of this state.

AB50,1324 Section 1324. 71.26 (2) (a) 4. of the statutes is amended to read:

AB50,697,21 71.26 (2) (a) 4. Plus the amount of the credit computed under s. 71.28 (1dm), (1dx), (1dy), (3g), (3h), (3n), (3q), (3t), (3w), (3wm), (3y), (5f), (5g), (5h), (5i), (5j), (5k), (5r), (5rm), (6n), (8m), and (10) and not passed through by a partnership, limited liability company, or tax-option corporation that has added that amount to the partnership’s, limited liability company’s, or tax-option corporation’s income under s. 71.21 (4) or 71.34 (1k) (g).

AB50,1325 Section 1325. 71.26 (3) (j) of the statutes is amended to read:

AB50,698,8 71.26 (3) (j) Sections 243, 244, 245, 245A, 246 and 246A are excluded and replaced by the rule that corporations may deduct from income dividends received from a corporation with respect to its common stock if the corporation receiving the dividends owns, directly or indirectly, during the entire taxable year at least 70 percent of the total combined voting stock of the payor corporation. In this paragraph, “dividends received” means gross dividends minus taxes on those dividends paid to a foreign nation and claimed as a deduction under this chapter. The same dividends may not be deducted more than once and may not be used in the determination of a net business loss under ss. 71.26 (4) and 71.45 (4).

AB50,1326 Section 1326. 71.26 (4) (a) of the statutes is amended to read:

AB50,699,5 71.26 (4) (a) Except as provided in par. (b) and s. 71.80 (25), a corporation, except a tax-option corporation or an insurer to which s. 71.45 (4) applies, may offset against its Wisconsin net business income any Wisconsin net business loss incurred in any of the 20 immediately preceding taxable years, if the corporation was subject to taxation under this chapter in the taxable year in which the loss was incurred, to the extent not offset by other items of Wisconsin income in the loss year and by Wisconsin net business income of any year between the loss year and the taxable year for which an offset is claimed. For purposes of this subsection, Wisconsin net business income or loss shall consist of all the income attributable to the operation of a trade or business in this state, less the business expenses allowed as deductions in computing net income, except that the dividends received deduction under sub. (3) (j) may not be used in the determination of a net business loss. The Wisconsin net business income or loss of corporations engaged in business within and without the state shall be determined under s. 71.25 (6) and (10) to (12). Nonapportionable losses having a Wisconsin situs under s. 71.25 (5) (b) shall be included in Wisconsin net business loss; and nonapportionable income having a Wisconsin situs under s. 71.25 (5) (b), whether taxable or exempt, shall be included in other items of Wisconsin income and Wisconsin net business income for purposes of this subsection.

AB50,1327 Section 1327. 71.28 (3w) (a) 2m. of the statutes is created to read:

AB50,699,8 71.28 (3w) (a) 2m. “Contract” means the contract between the claimant and the Wisconsin Economic Development Corporation under s. 238.399.

AB50,1328 Section 1328. 71.28 (3w) (a) 6. of the statutes is renumbered 71.28 (3w) (a) 6. a. and amended to read:

AB50,699,14 71.28 (3w) (a) 6. a. “Zone payroll” means the amount of state payroll that is attributable to wages paid to full-time employees based in an enterprise zone. “Zone Except as provided in subd. 6. b., “zone payroll” does not include the amount of wages paid to any full-time employees that exceeds $100,000.

AB50,1329 Section 1329. 71.28 (3w) (a) 6. b. of the statutes is created to read:

AB50,699,18 71.28 (3w) (a) 6. b. For a claimant whose contract is executed after December 31, 2025, “zone payroll” does not include the amount of wages paid to any full-time employees that exceeds $151,300.

AB50,1330 Section 1330. 71.28 (3w) (b) (intro.) of the statutes is amended to read:

AB50,700,2 71.28 (3w) (b) Filing claims under pre-2026 contracts; payroll. (intro.) Subject to the limitations provided in this subsection and s. 238.399 or s. 560.799, 2009 stats., a claimant whose contract is executed prior to January 1, 2026, may claim as a credit against the tax imposed under s. 71.23 an amount calculated as follows:

AB50,1331 Section 1331. 71.28 (3w) (bd) of the statutes is created to read:

AB50,700,7 71.28 (3w) (bd) Filing claims under post-2025 contracts; payroll. Subject to the limitations provided in this subsection and s. 238.399, a claimant whose contract is executed after December 31, 2025, may claim as a credit against the tax imposed under s. 71.23 an amount calculated as follows:

AB50,700,8 1. Determine the amount that is the lesser of:

AB50,700,15 a. The number of full-time employees whose annual wages are greater than $34,220 in a tier I county or municipality or greater than $45,390 in a tier II county or municipality and who the claimant employed in the enterprise zone in the taxable year, minus the number of full-time employees whose annual wages were greater than $34,220 in a tier I county or municipality or greater than $45,390 in a tier II county or municipality and who the claimant employed in the area that comprises the enterprise zone in the base year.

AB50,700,21 b. The number of full-time employees whose annual wages are greater than $34,220 in a tier I county or municipality or greater than $45,390 in a tier II county or municipality and who the claimant employed in the state in the taxable year, minus the number of full-time employees whose annual wages were greater than $34,220 in a tier I county or municipality or greater than $45,390 in a tier II county or municipality and who the claimant employed in the state in the base year.

AB50,701,6 2. Determine the claimant’s average zone payroll by dividing the total wages for full-time employees whose annual wages are greater than $34,220 in a tier I county or municipality or greater than $45,390 in a tier II county or municipality and who the claimant employed in the enterprise zone in the taxable year by the number of full-time employees whose annual wages are greater than $34,220 in a tier I county or municipality or greater than $45,390 in a tier II county or municipality and who the claimant employed in the enterprise zone in the taxable year.

AB50,701,9 3. For employees in a tier I county or municipality, subtract $34,220 from the amount determined under subd. 2. and for employees in a tier II county or municipality, subtract $45,390 from the amount determined under subd. 2.

AB50,701,11 4. Multiply the amount determined under subd. 3. by the amount determined under subd. 1.

AB50,701,13 5. Multiply the amount determined under subd. 4. by the percentage determined under s. 238.399, not to exceed 7 percent.

AB50,1332 Section 1332. 71.28 (3w) (bm) 1. of the statutes is amended to read:

AB50,702,2 71.28 (3w) (bm) 1. In addition to the credits under par. pars. (b) and (bd) and subds. 2., 3., and 4., and subject to the limitations provided in this subsection and s. 238.399 or s. 560.799, 2009 stats., a claimant may claim as a credit against the tax imposed under s. 71.23 an amount equal to a percentage, as determined under s. 238.399 or s. 560.799, 2009 stats., not to exceed 100 percent, of the amount the claimant paid in the taxable year to upgrade or improve the job-related skills of any of the claimant’s full-time employees, to train any of the claimant’s full-time employees on the use of job-related new technologies, or to provide job-related training to any full-time employee whose employment with the claimant represents the employee’s first full-time job. This subdivision does not apply to employees who do not work in an enterprise zone.

AB50,1333 Section 1333. 71.28 (3w) (bm) 2. of the statutes is renumbered 71.28 (3w) (bm) 2. (intro.) and amended to read:

AB50,702,8 71.28 (3w) (bm) 2. (intro.) In addition to the credits under par. pars. (b) and (bd) and subds. 1., 3., and 4., and subject to the limitations provided in this subsection and s. 238.399 or s. 560.799, 2009 stats., a claimant may claim as a credit against the tax imposed under s. 71.23 one of the following amounts:

AB50,702,20 a. For a claimant whose contract is executed prior to January 1, 2026, an amount equal to the percentage, as determined under s. 238.399 or s. 560.799, 2009 stats., not to exceed 7 percent, of the claimant’s zone payroll paid in the taxable year to all of the claimant’s full-time employees whose annual wages are greater than the amount determined by multiplying 2,080 by 150 percent of the federal minimum wage in a tier I county or municipality, not including the wages paid to the employees determined under par. (b) 1., or greater than $30,000 in a tier II county or municipality, not including the wages paid to the employees determined under par. (b) 1., and who the claimant employed in the enterprise zone in the taxable year, if the total number of such employees is equal to or greater than the total number of such employees in the base year. A claimant may claim a credit under this subdivision for no more than 5 consecutive taxable years.

AB50,1334 Section 1334. 71.28 (3w) (bm) 2. b. of the statutes is created to read:

AB50,703,8 71.28 (3w) (bm) 2. b. For a claimant whose contract is executed after December 31, 2025, an amount equal to the percentage, as determined under s. 238.399, not to exceed 7 percent, of the claimant’s zone payroll paid in the taxable year to all of the claimant’s full-time employees whose annual wages are greater than $34,220 in a tier I county or municipality, not including the wages paid to the employees determined under par. (bd) 1., or greater than $45,390 in a tier II county or municipality, not including the wages paid to the employees determined under par. (bd) 1., and who the claimant employed in the enterprise zone in the taxable year, if the total number of such employees is equal to or greater than the total number of such employees in the base year.

AB50,1335 Section 1335. 71.28 (3w) (bm) 3. of the statutes is amended to read:

AB50,703,15 71.28 (3w) (bm) 3. In addition to the credits under par. pars. (b) and (bd) and subds. 1., 2., and 4., and subject to the limitations provided in this subsection and s. 238.399 or s. 560.799, 2009 stats., for taxable years beginning after December 31, 2008, a claimant may claim as a credit against the tax imposed under s. 71.23 up to 10 percent of the claimant’s significant capital expenditures, as determined under s. 238.399 (5m) or s. 560.799 (5m), 2009 stats.

AB50,1336 Section 1336. 71.28 (3w) (bm) 4. of the statutes is amended to read:

AB50,704,2 71.28 (3w) (bm) 4. In addition to the credits under par. pars. (b) and (bd) and subds. 1., 2., and 3., and subject to the limitations provided in this subsection and s. 238.399 or s. 560.799, 2009 stats., for taxable years beginning after December 31, 2009, a claimant may claim as a credit against the tax imposed under s. 71.23, up to 1 percent of the amount that the claimant paid in the taxable year to purchase tangible personal property, items, property, or goods under s. 77.52 (1) (b), (c), or (d), or services from Wisconsin vendors, as determined under s. 238.399 (5) (e) or s. 560.799 (5) (e), 2009 stats., except that the claimant may not claim the credit under this subdivision and subd. 3. for the same expenditures.

AB50,1337 Section 1337. 71.28 (3w) (cm) of the statutes is created to read:

AB50,704,14 71.28 (3w) (cm) Inflation adjustments. For taxable years beginning after December 31, 2026, the dollar amounts in pars. (a) 6. b., (bd) 1. a. and b., 2., and 3., and (bm) 2. b. shall be increased each year by a percentage equal to the percentage change between the U.S. consumer price index for all urban consumers, U.S. city average, for the month of August of the previous year and the U.S. consumer price index for all urban consumers, U.S. city average, for the month of August of the year before the previous year, as determined by the federal department of labor. Each amount that is revised under this paragraph shall be rounded to the nearest multiple of $10 if the revised amount is not a multiple of $10 or, if the revised amount is a multiple of $5, such an amount shall be increased to the next higher multiple of $10.

AB50,1338 Section 1338. 71.28 (3y) (b) 6. of the statutes is amended to read:

AB50,704,22 71.28 (3y) (b) 6. For taxable years beginning after December 31, 2023, and before January 1, 2025, the amount of the investment in workforce housing, as defined in s. 234.66 (1) (i), for employees, not to exceed 15 percent of such investment, and, for taxable years beginning after December 31, 2023, the amount of the investment made in establishing an employee child care program for employees, not to exceed 15 percent of such investment, as determined by the Wisconsin Economic Development Corporation.

AB50,1339 Section 1339. 71.28 (3y) (b) 7. of the statutes is created to read:

AB50,705,4 71.28 (3y) (b) 7. For taxable years beginning after December 31, 2024, the amount of the investment in workforce housing, as defined in s. 234.66 (1) (i), for employees, including contributions made by the person to a 3rd party responsible for building or rehabilitating workforce housing, including contributions made to a local revolving loan fund program, not to exceed 15 percent of such investment.

AB50,1340 Section 1340. 71.28 (4) (ad) 4. a. of the statutes is amended to read:

AB50,705,16 71.28 (4) (ad) 4. a. Except as provided in subds. 5. and, 6., and 7. for taxable years beginning after December 31, 2014, a corporation may claim a credit against the tax imposed under s. 71.23, as allocated under par. (d), an amount equal to 5.75 percent of the amount by which the corporation’s qualified research expenses for the taxable year exceed 50 percent of the average qualified research expenses for the 3 taxable years immediately preceding the taxable year for which the claimant claims the credit. If the corporation had no qualified research expenses in any of the 3 taxable years immediately preceding the taxable year for which the claimant claims the credit, the claimant may claim an amount equal to 2.875 percent of the corporation’s qualified research expenses for the taxable year for which the claimant claims the credit.

AB50,1341 Section 1341. 71.28 (4) (ad) 7. of the statutes is created to read:

AB50,706,7 71.28 (4) (ad) 7. a. For taxable years beginning after December 31, 2024, an individual, a partner of a partnership, a shareholder of a tax-option corporation, or a member of a limited liability company may claim a credit against the tax imposed under s. 71.23, as allocated under par. (d), an amount equal to 11.5 percent of the amount by which the individual’s, partnership’s, tax-option corporation’s, or limited liability company’s qualified research expenses for the taxable year exceed 50 percent of the average qualified research expenses for the 3 taxable years immediately preceding the taxable year for which the claimant claims the credit. If the individual, partnership, tax-option corporation, or limited liability company had no qualified research expenses in any of the 3 taxable years immediately preceding the taxable year for which the claimant claims the credit, the claimant may claim an amount equal to 5.75 percent of the individual’s, partnership’s, tax-option corporation’s, or limited liability company’s qualified research expenses for the taxable year for which the claimant claims the credit.

AB50,706,15 b. For purposes of subd. 7. a., “qualified research expenses” means qualified research expenses as defined in section 41 of the Internal Revenue Code, except that “qualified research expenses” includes only expenses incurred by the individual, partnership, tax-option corporation, or limited liability company for research related to nuclear power, incurred for research conducted in this state, for the taxable year and does not include compensation used in computing the credit under sub. (1dx). Section 41 (f) (1), (2), (5), and (6) and (h) of the Internal Revenue Code does not apply to the credit under this subdivision.

AB50,1342 Section 1342. 71.28 (4) (k) (intro.) of the statutes is amended to read:

AB50,706,20 71.28 (4) (k) Refunds. (intro.) Notwithstanding par. (f), for taxable years beginning after December 31, 2017, if the allowable amount of the claim under par. (ad) 4., 5., or 6., or 7. exceeds the tax otherwise due under s. 71.23, all of the following apply:

AB50,1343 Section 1343. 71.28 (4) (k) 1. c. of the statutes is amended to read:

AB50,707,3 71.28 (4) (k) 1. c. For taxable years beginning after December 31, 2023, the amount of the claim not used to offset the tax due, not to exceed 25 percent of the allowable amount of the claim under par. (ad) 4., 5., or 6., or 7., shall be certified by the department of revenue to the department of administration for payment by check, share draft, or other draft drawn from the appropriation account under s. 20.835 (2) (d).

AB50,1344 Section 1344. 71.28 (5f) of the statutes is created to read:

AB50,707,6 71.28 (5f) Film production services credit. (a) Definitions. In this subsection:

AB50,707,13 1. “Accredited production” means a film, video, broadcast advertisement, or television production, as approved by the department of tourism, for which the aggregate salary and wages included in the cost of the production for the period ending 12 months after the month in which the principal filming or taping of the production begins exceeds $100,000 for a production that is 30 minutes or longer or $50,000 for a production that is less than 30 minutes. “Accredited production” does not include any of the following, regardless of the production costs:

AB50,707,15 a. News, current events, or public programming or a program that includes weather or market reports.

AB50,707,16 b. A talk show.

AB50,707,17 c. A production with respect to a questionnaire or contest.

AB50,707,18 d. A sports event or sports activity.

AB50,707,19 e. A gala presentation or awards show.

AB50,707,20 f. A finished production that solicits funds.

AB50,707,23 g. A production for which the production company is required under 18 USC 2257 to maintain records with respect to a performer portrayed in a single media or multimedia program.

AB50,708,2 h. A production produced primarily for industrial, corporate, or institutional purposes.

AB50,708,8 2. “Claimant” means a film production company, as defined in sub. (5h) (a) 2., that operates an accredited production in this state, if the company owns the copyright in the accredited production or has contracted directly with the copyright owner or a person acting on the owner’s behalf and if the company has a viable plan, as determined by the department of tourism, for the commercial distribution of the finished production.

AB50,708,13 3. “Commercial domicile” means the location from which a trade or business is principally managed and directed, based on any factors the department of tourism determines are appropriate, including the location where the greatest number of employees of the trade or business work, the trade or business has its office or base of operations, or from which the employees are directed or controlled.

AB50,709,6 4. “Production expenditures” means any expenditure that is incurred in this state and directly used to produce an accredited production, including expenditures for writing, budgeting, casting, location scouts, set construction and operation, wardrobes, makeup, clothing accessories, photography, sound recording, sound synchronization, sound mixing, lighting, editing, film processing, film transferring, special effects, visual effects, renting or leasing facilities or equipment, renting or leasing motor vehicles, food, lodging, and any other similar pre-production, production, and post-production expenditure as determined by the department of tourism. “Production expenditures” includes expenditures for music that is performed, composed, or recorded by a musician who is a resident of this state or published or distributed by an entity that has its commercial domicile in this state; air travel that is purchased from a travel agency or company that has its commercial domicile in this state; and insurance that is purchased from an insurance agency or company that has its commercial domicile in this state. “Production expenditures” does not include salary or wages or expenditures for the marketing and distribution of an accredited production.

AB50,709,9 (b) Filing claims. Subject to the limitations provided in this subsection, for taxable years beginning after December 31, 2025, a claimant may claim as a credit against the tax imposed under s. 71.23 any of the following amounts:

AB50,709,13 1. An amount equal to 25 percent of the salary or wages paid by the claimant to the claimant’s employees in the taxable year for services rendered in this state to produce an accredited production and paid to employees who were residents of this state at the time that they were paid.

AB50,709,15 2. An amount equal to 25 percent of the production expenditures paid by the claimant in the taxable year to produce an accredited production.

AB50,709,20 3. An amount equal to the taxes imposed under ss. 77.52 and 77.53 that the claimant paid in the taxable year on the purchase of tangible personal property and taxable services that are used directly in producing an accredited production in this state, including all stages from the final script stage to the distribution of the finished production.

AB50,710,2 (c) Limitations. 1. No amount of the salary or wages paid under par. (b) 1. may be the basis for a credit under this subsection unless the salary or wages are paid for services rendered after December 31, 2025, and directly incurred to produce the accredited production.

AB50,710,8 2. The total amount of the credits that may be claimed by a claimant under par. (b) 1. shall not exceed an amount equal to the first $250,000 of salary or wages paid to each of the claimant’s employees, as described in par. (b) 1., in the taxable year, not including the salary or wages paid to the claimant’s 2 highest-paid employees, as described in par. (b) 1., in the taxable year, if the claimant’s budgeted production expenditures are $1,000,000 or more.

AB50,710,12 3. No credit may be allowed under this subsection unless the claimant files an application with the department of tourism, at the time and in the manner prescribed by the office, and the office approves the application. The claimant shall submit a copy of the approved application with the claimant’s return.

AB50,710,20 4. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and the amount of, the credit are based on their payment of amounts under par. (b). A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their ownership interest.

AB50,710,23 (d) Administration. 1. Subsection (4) (e), (g), and (h), as it applies to the credit under sub. (4), applies to the credits under this subsection. Subsection (4) (f), as it applies to the credit under sub. (4), applies to the credits under par. (b) 1. and 3.

AB50,711,5 2. If the allowable amount of the claim under par. (b) 2. exceeds the tax otherwise due under s. 71.23 or no tax is due under s. 71.23, the amount of the claim not used to offset the tax due shall be certified by the department of revenue to the department of administration for payment by check, share draft, or other draft drawn from the appropriation account under s. 20.835 (2) (bm).

AB50,711,14 3. Any person, including a nonprofit entity described in section 501 (c) (3) of the Internal Revenue Code, may sell or otherwise transfer a credit under this subsection, in whole or in part, to another person who is subject to the taxes imposed under s. 71.02, 71.23, or 71.43, if the person notifies the department of the transfer, and submits with the notification a copy of the transfer documents, and the department certifies ownership of the credit. The transferee may first use the credit to offset tax of the transferor in the taxable year in which the transfer occurs and may use the credit only to offset tax in taxable years in which the credit is otherwise allowed to be claimed and carried forward by the original claimant.

AB50,1345 Section 1345. 71.28 (5h) of the statutes is created to read:

AB50,711,17 71.28 (5h) Film production company investment credit. (a) Definitions. In this subsection:

AB50,711,19 1. “Claimant” means a person who files a claim under this subsection and who does business in this state as a film production company.

AB50,711,22 2. “Film production company” means an entity that creates films, videos, broadcast advertisement, or television productions, not including the productions described under sub. (5f) (a) 1. a. to h.

AB50,712,2 3. “Physical work” does not include preliminary activities such as planning, designing, securing financing, researching, developing specifications, or stabilizing property to prevent deterioration.

AB50,712,7 4. “Previously owned property” means real property that the claimant or a related person owned during the 2 years prior to doing business in this state as a film production company and for which the claimant may not deduct a loss from the sale of the property to, or an exchange of the property with, the related person under section 267 of the Internal Revenue Code.

AB50,712,9 5. “Used exclusively” means used to the exclusion of all other uses except for other use not exceeding 5 percent of total use.