71.07(8b)(a)3.3. “Claimant” means a person who has an ownership interest in a qualified development and who files a claim under this subsection. 71.07(8b)(a)4.4. “Compliance period” means the 15-year period beginning with the first taxable year of the credit period. 71.07(8b)(a)5.5. “Credit period” means the period of 6 taxable years beginning with the taxable year in which a qualified development is placed in service. For purposes of this subdivision, if a qualified development consists of more than one building, the qualified development is placed in service in the taxable year in which the last building of the qualified development is placed in service. 71.07(8b)(a)6.6. “Qualified basis” means the qualified basis determined under section 42 (c) (1) of the Internal Revenue Code. 71.07(8b)(a)7.7. “Qualified development” means a qualified low-income housing project under section 42 (g) of the Internal Revenue Code that is financed with tax-exempt bonds, pursuant to section 42 (i) (2) of the Internal Revenue Code, and located in this state. 71.07(8b)(b)(b) Filing claims. Subject to the limitations provided in this subsection and in s. 234.45, for taxable years beginning after December 31, 2017, a claimant may claim as a credit against the taxes imposed under s. 71.02 or 71.08, up to the amount of the tax, the amount allocated to the claimant by the authority under s. 234.45 for each taxable year within the credit period. 71.07(8b)(c)1.1. No person may claim the credit under par. (b) unless the claimant includes with the claimant’s return a copy of the allocation certificate issued to the qualified development. 71.07(8b)(c)2.2. A partnership, limited liability company, or tax-option corporation may not claim the credit under this subsection. The partners of a partnership, members of a limited liability company, or shareholders in a tax-option corporation may claim the credit under this subsection based on eligible costs incurred by the partnership, limited liability company, or tax-option corporation. The partnership, limited liability company, or tax-option corporation shall calculate the amount of the credit that may be claimed by each partner, member, or shareholder and shall provide that information to the partner, member, or shareholder. For shareholders of a tax-option corporation, the credit may be allocated in proportion to the ownership interest of each shareholder. Credits computed by a partnership or limited liability company may be claimed in proportion to the ownership interests of the partners or members or allocated to partners or members as provided in a written agreement among the partners or members that is entered into no later than the last day of the taxable year of the partnership or limited liability company, for which the credit is claimed. Any partner or member who claims the credit as allocated by a written agreement shall provide a copy of the agreement with the tax return on which the credit is claimed. A person claiming the credit as provided under this subdivision is solely responsible for any tax liability arising from a dispute with the department of revenue related to claiming the credit. 71.07(8b)(d)1.1. As of the last day of any taxable year during the compliance period, if the amount of the qualified basis of a qualified development with respect to a claimant is less than the amount of the qualified basis as of the last day of the immediately preceding taxable year, the amount of the claimant’s tax liability under this subchapter shall be increased by the recapture amount determined by using the method under section 42 (j) of the Internal Revenue Code. 71.07(8b)(d)2.2. In the event that the recapture of any credit is required in any taxable year, the taxpayer shall include the recaptured proportion of the credit on the return submitted for the taxable year in which the recapture event is identified. 71.07(9)(a)1.1. “Claimant” means a natural person who files a claim or on whose behalf a claim is filed under this subsection but does not include an estate, fiduciary or trust. 71.07(9)(a)2.2. “Principal dwelling” means any dwelling, whether owned or rented, and the land surrounding it that is reasonably necessary for use of the dwelling as a primary dwelling of the claimant and may include a part of a multidwelling or multipurpose building and a part of the land upon which it is built that is used as the claimant’s primary dwelling. 71.07(9)(a)3.3. “Property taxes” means real property taxes, exclusive of special assessments, delinquent interest and charges for service, paid by a claimant on the claimant’s principal dwelling during the taxable year for which credit under this subsection is claimed, less any property taxes paid which are properly includable as a trade or business expense under section 162 of the Internal Revenue Code. If the principal dwelling on which the taxes were paid is owned by 2 or more persons or entities as joint tenants or tenants in common or is owned by spouses as marital property, “property taxes” is that part of property taxes paid that reflects the ownership percentage of the claimant. If the principal dwelling is sold during the taxable year the “property taxes” for the seller and buyer shall be the amount of the tax prorated to each in the closing agreement pertaining to the sale or, if not so provided for in the closing agreement, the tax shall be prorated between the seller and buyer in proportion to months of their respective ownership. “Property taxes” includes monthly municipal permit fees in respect to a principal dwelling collected under s. 66.0435 (3) (c). 71.07(9)(a)4.4. “Rent constituting property taxes” means 25 percent of rent if heat is not included, or 20 percent of rent if heat is included, paid during the taxable year for which credit is claimed under this subsection, at arm’s length, for the use of a principal dwelling and contiguous land, excluding any payment for domestic, food, medical or other services which are unrelated to use of the dwelling as housing, less any rent paid that is properly includable as a trade or business expense under the internal revenue code. “Rent” includes space rental paid to a landlord for parking a mobile home or manufactured home. Rent shall be apportioned among the occupants of a principal dwelling according to their respective contribution to the total amount of rent paid. “Rent” does not include rent paid for the use of housing which was exempt from property taxation, except housing for which payments in lieu of taxes were made under s. 66.1201 (22). 71.07(9)(b)1.1. Subject to the limitations under this subsection and except as provided in subds. 2., 4. and 5., a claimant may claim as a credit against, but not to exceed the amount of, taxes under s. 71.02, 10 percent of the first $2,000 of property taxes or rent constituting property taxes, or 10 percent of the first $1,000 of property taxes or rent constituting property taxes of a married person filing separately. 71.07(9)(b)2.2. Subject to the limitations under this subsection, a claimant may claim as a credit against, but not to exceed the amount of, taxes under s. 71.02, the amounts specified in the proposal under 1997 Wisconsin Act 237, section 9256 (2c). 71.07(9)(b)4.4. For taxable years beginning after December 31, 1998, and before January 1, 2000, subject to the limitations under this subsection a claimant may claim as a credit against, but not to exceed the amount of, taxes under s. 71.02, 8.4 percent of the first $0 of property taxes or rent constituting property taxes, or 8.4 percent of the first $0 of property taxes or rent constituting property taxes of a married person filing separately. 71.07(9)(b)5.5. For taxable years beginning after December 31, 1999, subject to the limitations under this subsection a claimant may claim as a credit against, but not to exceed the amount of, taxes under s. 71.02, 12 percent of the first $2,500 of property taxes or rent constituting property taxes, or 12 percent of the first $1,250 of property taxes or rent constituting property taxes of a married person filing separately. 71.07(9)(c)(c) For an unmarried person or a married person filing a separate return who is a part-year resident of this state, the credit under this subsection is limited to that fraction of the amount determined under this subsection that Wisconsin adjusted gross income is of federal adjusted gross income. No credit is allowed under this subsection for unmarried persons or married persons filing separate returns who are nonresidents of this state. If one spouse is not domiciled in this state during the entire taxable year, the credit on a joint return is determined by multiplying the school property tax credit that would be available to them if both spouses were domiciled in this state during the entire taxable year by a fraction the numerator of which is their joint Wisconsin adjusted gross income and the denominator of which is their joint federal adjusted gross income. No credit is allowed under this subsection on a joint return if both spouses are nonresidents of this state. 71.07(9)(d)(d) No credit may be allowed under this subsection unless it is claimed within the period specified in s. 71.75 (2). 71.07(9)(e)(e) In any case in which a principal dwelling is rented by a person from another person under circumstances deemed by the department of revenue to be not at arm’s length, the department may determine rent at arm’s length, and, for purposes of this subsection, such determination shall be final. 71.07(9)(f)(f) The department of revenue, on its forms and instructions, shall refer to the credit under this subsection as the school property tax credit. 71.07(9e)(aj)(aj) For taxable years beginning after December 31, 2010, an individual may credit against the tax imposed under s. 71.02 an amount equal to one of the following percentages of the federal basic earned income credit for which the person is eligible for the taxable year under section 32 of the Internal Revenue Code: 71.07(9e)(aj)1.1. If the person has one qualifying child who has the same principal place of abode as the person, 4 percent. 71.07(9e)(aj)2.2. If the person has 2 qualifying children who have the same principal place of abode as the person, 11 percent. 71.07(9e)(aj)3.3. If the person has 3 or more qualifying children who have the same principal place of abode as the person, 34 percent. 71.07(9e)(b)(b) No credit may be allowed under this subsection to married persons, except married persons living apart who are treated as single under section 7703 (b) of the internal revenue code, if the husband and wife report their income on separate income tax returns for the taxable year. 71.07(9e)(c)(c) Part-year residents and nonresidents of this state are not eligible for the credit under this subsection. 71.07(9e)(d)(d) The department of revenue may enforce the credit under this subsection and may take any action, conduct any proceeding and proceed as it is authorized in respect to taxes under this chapter. The income tax provisions in this chapter relating to assessments, refunds, appeals, collection, interest and penalties apply to the credit under this subsection. 71.07(9e)(e)(e) No credit may be allowed under this subsection unless it is claimed within the time period under s. 71.75 (2). 71.07(9e)(f)(f) Except as provided in s. 71.80 (3) and (3m), if the allowable amount of the claim under this subsection exceeds the taxes otherwise due under this chapter or no taxes are due under this chapter, the amount of the claim not used to offset taxes 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 under s. 20.835 (2) (f) or (kf). 71.07(9g)(9g) Additional child and dependent care tax credit. 71.07(9g)(a)1.1. “Claimant” means an individual who is eligible for and claims the federal child and dependent care tax credit for the taxable year to which the claim under this subsection relates. 71.07(9g)(a)2.2. “Federal child and dependent care tax credit” means the tax credit under section 21 of the Internal Revenue Code. 71.07(9g)(b)1.1. For taxable years beginning after December 31, 2021, and before January 1, 2024, and subject to the limitations provided in this subsection, a claimant may claim as a credit against the tax imposed under s. 71.02, up to the amount of those taxes, an amount equal to 50 percent of the federal child and dependent care tax credit claimed by the claimant on his or her federal income tax return for the taxable year to which the claim under this subsection relates. 71.07(9g)(b)2.2. For taxable years beginning after December 31, 2023, and subject to the limitations provided in this subsection, a claimant may claim as a credit against the tax imposed under s. 71.02, up to the amount of those taxes, an amount equal to 100 percent of the federal child and dependent care tax credit that the claimant may claim on his or her federal income tax return for the taxable year to which the claim under this subsection relates using the expense limitation under par. (c) 5. rather than the expense limitation under 26 USC 21 (c). 71.07(9g)(c)1.1. No credit may be allowed under this subsection unless it is claimed within the period under s. 71.75 (2). 71.07(9g)(c)2.2. No credit may be allowed under this subsection for a taxable year covering a period of less than 12 months, except for a taxable year closed by reason of the death of the claimant. 71.07(9g)(c)3.3. The credit under this subsection cannot be claimed by a part-year resident or a nonresident of this state. 71.07(9g)(c)4.4. A claimant who claims the credit under this subsection is subject to the special rules in 26 USC 21 (e) (2) and (4). 71.07(9g)(c)5.5. Notwithstanding 26 USC 21 (c), for taxable years beginning after December 31, 2023, the maximum allowable expenses to determine the amount of the credit under par. (b) 2. is $10,000 for one qualifying individual, as defined in 26 USC 21 (b), and $20,000 for 2 or more qualifying individuals, as defined in 26 USC 21 (b). 71.07(9g)(d)(d) Administration. Subsection (9e) (d), to the extent that it applies to the credit under that subsection, applies to the credit under this subsection. 71.07(9m)(9m) Supplement to federal historic rehabilitation credit. 71.07(9m)(a)1m.1m. For taxable years beginning before January 1, 2014, any person may credit against taxes otherwise due under this chapter, up to the amount of those taxes, an amount equal to 5 percent, for taxable years beginning before January 1, 2013, or 10 percent, for taxable years beginning after December 31, 2012, and before January 1, 2014, of the costs of qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the Internal Revenue Code, for certified historic structures on property located in this state if the physical work of construction or destruction in preparation for construction begins after December 31, 1988, and the rehabilitated property is placed in service after June 30, 1989, and before January 1, 2014. 71.07(9m)(a)2m.2m. For taxable years beginning after December 31, 2013, any person may claim as a credit against taxes otherwise due under s. 71.02, up to the amount of those taxes, an amount equal to 20 percent of the costs of qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the Internal Revenue Code, for certified historic structures on property located in this state, if the cost of the person’s qualified rehabilitation expenditures is at least $50,000 and the rehabilitated property is placed in service after December 31, 2013. 71.07(9m)(a)3.3. For taxable years beginning after December 31, 2013, any person may claim as a credit against taxes otherwise due under s. 71.02, up to the amount of those taxes, an amount equal to 20 percent of the costs of qualified rehabilitation expenditures, as defined in section 47 (c) (2) of the Internal Revenue Code, for qualified rehabilitated buildings, as defined in section 47 (c) (1) of the Internal Revenue Code, on property located in this state, if the cost of the person’s qualified rehabilitation expenditures is at least $50,000 and the rehabilitated property is placed in service after December 31, 2013, and regardless of whether the rehabilitated property is used for multiple or revenue-producing purposes. No credit may be claimed under this subdivision for property listed as a contributing building in the state register of historic places or in the national register of historic places and no credit may be claimed under this subdivision for nonhistoric, nonresidential property converted into housing if the property has been previously used for housing. 71.07(9m)(c)(c) No person may claim the credit under par. (a) 2m. unless the claimant includes with the claimant’s return a copy of the claimant’s certification under s. 238.17. For certification purposes under s. 238.17, the claimant shall provide to the Wisconsin Economic Development Corporation all of the following: 71.07(9m)(c)1.1. Evidence that the rehabilitation was recommended by the state historic preservation officer for approval by the secretary of the interior under 36 CFR 67.6 before the physical work of construction, or destruction in preparation for construction, began and that the rehabilitation was approved by the state historic preservation officer. 71.07(9m)(c)2.2. Evidence that the taxpayer obtained written certification from the state historic preservation officer that: 71.07(9m)(c)2.a.a. The property is listed on the national register of historic places in Wisconsin or the state register of historic places, or is determined by the state historical society to be eligible for listing on the national register of historic places in Wisconsin or the state register of historic places, or is located in a historic district that is listed in the national register of historic places in Wisconsin or the state register of historic places and is certified by the state historic preservation officer as being of historic significance to the district, or is an outbuilding of an otherwise eligible property certified by the state historic preservation officer as contributing to the historic significance of the property. 71.07(9m)(c)2.b.b. The proposed preservation or rehabilitation plan complies with standards promulgated under s. 44.02 (24) and the completed preservation or rehabilitation substantially complies with the proposed plan. 71.07(9m)(c)2.c.c. The costs are not incurred to acquire any building or interest in a building or to enlarge an existing building. 71.07(9m)(c)2.d.d. The costs were not incurred before the state historical society approved the proposed preservation or rehabilitation plan. 71.07(9m)(cm)(cm) Any credit claimed under this subsection for Wisconsin purposes shall be claimed at the same time as for federal purposes. 71.07(9m)(cn)(cn) For taxable years beginning after December 31, 2014, the Wisconsin Economic Development Corporation shall certify a person to claim a credit under par. (a) 3. if all of the following apply: 71.07(9m)(cn)1.1. The corporation previously certified the person to claim a credit under par. (a) 3. for any taxable year beginning before January 1, 2015. 71.07(9m)(cn)2.2. The proposed project for which the person wishes to claim a credit under this paragraph for any taxable year beginning after December 31, 2014, is located in the city of Green Bay. 71.07(9m)(cn)3.3. The proposed project described under subd. 2. is located on the same parcel as the project for which the person received certification under subd. 1. or on a parcel that is contiguous to the project for which the person received certification under subd. 1. 71.07(9m)(cn)4.4. The corporation determines that the person is eligible to claim the credit under section 47 of the Internal Revenue Code for the qualified rehabilitation expenses incurred for the project for which the person received certification under subd. 1. 71.07(9m)(d)(d) The Wisconsin adjusted basis of the building shall be reduced by the amount of any credit awarded under this subsection. The Wisconsin adjusted basis of a partner’s interest in a partnership, of a member’s interest in a limited liability company or of stock in a tax-option corporation shall be adjusted to take into account adjustments made under this paragraph. 71.07(9m)(f)(f) A partnership, limited liability company, or tax-option corporation may not claim the credit under this subsection. The partners of a partnership, members of a limited liability company, or shareholders in a tax-option corporation may claim the credit under this subsection based on eligible costs incurred by the partnership, company, or tax-option corporation. The partnership, limited liability company, or tax-option corporation shall calculate the amount of the credit which may be claimed by each partner, member, or shareholder and shall provide that information to the partner, member, or shareholder. For shareholders of a tax-option corporation, the credit may be allocated in proportion to the ownership interest of each shareholder. Credits computed by a partnership or limited liability company may be claimed in proportion to the ownership interests of the partners or members or allocated to partners or members as provided in a written agreement among the partners or members that is entered into no later than the last day of the taxable year of the partnership or limited liability company, for which the credit is claimed. For a partnership or limited liability company that places property in service after June 29, 2008, and before January 1, 2009, the credit attributable to such property may be allocated, at the election of the partnership or limited liability company, to partners or members for a taxable year of the partnership or limited liability company that ends after June 29, 2008, and before January 1, 2010. Any partner or member who claims the credit as provided under this paragraph shall attach a copy of the agreement, if applicable, to the tax return on which the credit is claimed. A person claiming the credit as provided under this paragraph is solely responsible for any tax liability arising from a dispute with the department of revenue related to claiming the credit. 71.07(9m)(g)1.1. If a person who claims the credit under this subsection elects to claim the credit based on claiming amounts for expenditures as the expenditures are paid, rather than when the rehabilitation work is completed, the person shall file an election form with the department, in the manner prescribed by the department. 71.07(9m)(g)2.2. Notwithstanding s. 71.77, the department may adjust or disallow the credit claimed under this subsection within 4 years after the date that the state historical society notifies the department that the expenditures for which the credit was claimed do not comply with the standards for certification promulgated under s. 44.02 (24). If the department adjusts or disallows, in whole or in part, a credit transferred under par. (h), only the person who originally transferred the credit to another person is liable to repay the adjusted or disallowed amount. 71.07(9m)(h)(h) Any person, including a nonprofit entity described in section 501 (c) (3) of the Internal Revenue Code, may sell or otherwise transfer the credit under par. (a) 2m. or 3., 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 with each transfer. The transferor may file a claim for more than one taxable year on a form prescribed by the department to compute all years of the credit under par. (a) 2m. or 3., at the time of the transfer request. The transferee may first use the credit to offset tax in the taxable year of the transferor in which the transfer occurs and may use the credit only to offset tax in taxable years otherwise allowed to be claimed and carried forward by the original claimant. 71.07(9m)(i)(i) If a person who claims a credit under this subsection and a credit under section 47 of the Internal Revenue Code for the same qualified rehabilitation expenditures is required to repay any amount of the credit claimed under section 47 of the Internal Revenue Code, the person shall repay to the department a proportionate amount of the credit claimed under this subsection. 71.07(9r)(9r) State historic rehabilitation credit. 71.07(9r)(a)(a) For taxable years beginning on or after August 1, 1988, any natural person may credit against taxes otherwise due under s. 71.02 an amount equal to 25 percent of the costs of preservation or rehabilitation of historic property located in this state, including architectural fees and costs incurred in preparing nomination forms for listing in the national register of historic places in Wisconsin or the state register of historic places, if the nomination is made within 5 years prior to submission of a preservation or rehabilitation plan under par. (b) 3. b., and if the physical work of construction or destruction in preparation for construction begins after December 31, 1988, except that the credit may not exceed $10,000, or $5,000 for married persons filing separately, for any preservation or rehabilitation project. 71.07(9r)(b)(b) The department of revenue shall approve the credit under this subsection if all of the following conditions are met: 71.07(9r)(b)1.1. The costs are incurred and the claim is submitted by the owner of the historic property. 71.07(9r)(b)1m.1m. The costs included in the claim relate only to preservation or rehabilitation work done to any of the following: 71.07(9r)(b)1m.b.b. The interior of a window sash if work is done to the exterior of the window sash. 71.07(9r)(b)1m.e.e. Electrical or plumbing systems, but not electrical or plumbing fixtures. 71.07(9r)(b)2.2. The historic property, including outbuildings that contribute to the significance of the historic property, is an owner-occupied personal residence if the residence is not actively used in a trade or business, held for the production of income or held for sale or other disposition in the ordinary course of the claimant’s trade or business.
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Chs. 70-79, Taxation
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