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1. “Allocation certificate” means a statement issued by the authority certifying
18that a qualified housing development is eligible for a credit under this subsection and
19specifying the amount of the credit that the owners of the qualified housing
20development may claim for each taxable year of the credit period.
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2. “Area median gross income” has the meaning as used for purposes of
26 USC
2242.
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3. “Authority” means the Wisconsin Housing and Economic Development
24Authority.
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14. “Claimant” means a person who has an ownership interest in a qualified
2housing development and who files a claim under this subsection.
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5. “Compliance period” means the 10-year period beginning with the first
4taxable year of the credit period.
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6. “Credit period” means the 6-year period beginning with the taxable year in
6which a qualified housing development is placed in service. For purposes of this
7subdivision, if a qualified housing development consists of more than one building,
8the qualified housing development is placed in service in the taxable year in which
9the last building is placed in service.
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7. “Qualified basis” means the amount equal to the applicable fraction of the
11adjusted basis of the qualified housing development as of the close of the first taxable
12year of the credit period. The applicable fraction is the smaller of a fraction whose
13numerator is the number of qualified units in the qualified housing development and
14denominator is the total number of residential rental units in the qualified housing
15development or a fraction whose numerator is the total floor space of the qualified
16units in the qualified housing development and denominator is the total floor space
17of all the residential rental units in the qualified housing development. In
18calculating the applicable fraction, the number of qualified units and residential
19rental units and the amount of floor space shall be determined as of the close of the
20taxable year.
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8. “Qualified housing development” means a residential rental property
22development located in this state if at least 25 percent of the development's
23residential rental units are rent-restricted units and occupied by individuals whose
24tenant income is at least 61 percent but not more than 100 percent of area median
25gross income.
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19. “Qualified unit” means a rent-restricted unit that is occupied by individuals
2whose tenant income is at least 61 percent but not more than 100 percent of area
3median gross income.
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10. “Rent-restricted unit” means a residential rental unit if the gross rent with
5respect to the unit does not exceed 30 percent of area median gross income,
6determined as if the unit is occupied by one individual in a unit without a separate
7bedroom and 1.5 individuals for each separate bedroom in any other unit.
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11. “Tenant income” means the income determined under
26 USC 142 (d) (2)
9(B) of individuals occupying a residential rental unit.
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(b)
Filing claims. Subject to the limitations provided in this subsection and in
11s. 234.46, for taxable years beginning after December 31, 2020, a claimant may claim
12as a credit against the taxes imposed under s. 71.43, up to the amount of the tax, the
13amount allocated to the claimant by the authority under s. 234.46 for each taxable
14year within the credit period.
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(c)
Limitations. 1. No person may claim the credit under par. (b) unless the
16claimant includes with the claimant's return a copy of the allocation certificate
17issued for the qualified housing development.
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2. A partnership, limited liability company, or tax-option corporation may not
19claim the credit under this subsection. The partners of a partnership, members of
20a limited liability company, or shareholders in a tax-option corporation may claim
21the credit under this subsection based on eligible costs incurred by the partnership,
22limited liability company, or tax-option corporation. The partnership, limited
23liability company, or tax-option corporation shall calculate the amount of the credit
24that may be claimed by each partner, member, or shareholder and shall provide that
25information to each of them. Credits computed by a partnership or limited liability
1company may be claimed in proportion to the ownership interests of the partners or
2members or allocated to partners or members as provided in a written agreement
3among the partners or members that is entered into no later than the last day of the
4taxable year of the partnership or limited liability company for which the credit is
5claimed. Any partner or member who claims the credit as allocated by a written
6agreement shall provide a copy of the agreement with the tax return on which the
7credit is claimed. For shareholders of a tax-option corporation, the credit may be
8allocated in proportion to the ownership interest of each shareholder. A person
9claiming the credit as provided under this subdivision is solely responsible for any
10tax liability arising from a dispute with the department related to claiming the
11credit.
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3. No credit may be claimed under this subsection for the same costs for which
13a credit is claimed under sub. (6) or (8b) or s. 71.07 (8b), (9m), or (9r), 71.28 (6) or (8b),
14or 76.639.
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(d)
Recapture. 1. As of the last day of any taxable year during the compliance
16period, if the qualified basis of a qualified housing development with respect to a
17claimant is less than the qualified basis as of the last day of the previous taxable year,
18the amount of the claimant's tax liability under this subchapter shall be increased
19by an amount equal to the excess of the aggregate credit claimed under this
20subsection in prior taxable years over the aggregate credit that would be claimed in
21those years if the full credit amount allocated to the claimant for the credit period
22was claimed ratably over 10 years.
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2. Subdivision 1. does not apply if the reduction in qualified basis for the
24taxable year is by reason of a casualty loss if the loss is restored by reconstruction
25or replacement within a reasonable period; a minimal change in floor space; or a
1disposition of an interest in the qualified housing development if it is reasonably
2expected that the development will continue to be operated as a qualified housing
3development for the remainder of the compliance period.
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3. In the event that the recapture of a credit is required in a taxable year, the
5taxpayer shall include the recaptured amount on the return submitted for the
6taxable year in which the recapture event is identified.
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(e)
Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
8s. 71.28 (4), applies to the credit under this subsection.
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9Section 11
. 71.49 (1) (cu) of the statutes is created to read:
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71.49
(1) (cu) State workforce housing credit under s. 71.47 (8f).
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11Section
12. 76.639 (3) of the statutes is renumbered 76.639 (3) (a).
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12Section
13. 76.639 (3) (b) of the statutes is created to read:
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76.639
(3) (b) An insurer that is a partner or member of a partnership or limited
14liability company that directly or indirectly owns a qualified development may claim
15the credit under sub. (2) in proportion to the insurer's percentage of ownership
16interest in the partnership or limited liability company or in accordance with the
17allocation of credits to the insurer pursuant to a written agreement among the
18partners or members of the partnership or limited liability company that is entered
19into no later than the last day of the taxable year of the partnership or limited
20liability company.
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21Section 14
. 76.6395 of the statutes is created to read:
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2276.6395 State workforce housing credit. (1)
Definitions. In this section:
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(a) “Allocation certificate” means a statement issued by the authority certifying
24that a qualified housing development is eligible for a credit under this section and
1specifying the amount of the credit that the owners of the qualified housing
2development may claim for each taxable year of the credit period.
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(b) “Area median gross income” has the meaning as used for purposes of
26 USC
442.
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(c) “Authority” means the Wisconsin Housing and Economic Development
6Authority.