SB720,38 Section 38. 71.78 (1) of the statutes is amended to read:

SB720,25,4 71.78 (1) Divulging information. Except as provided in subs. (4), (4m) and, (10), and (11), no person may divulge or circulate or offer to obtain, divulge, or circulate any information derived from an income, franchise, withholding, fiduciary, partnership, or limited liability company tax return or tax credit claim, including information which may be furnished by the department as provided in this section. This subsection does not prohibit publication by any newspaper of information lawfully derived from such returns or claims for purposes of argument or prohibit any public speaker from referring to such information in any address. This subsection does not prohibit the department from publishing statistics classified so as not to disclose the identity of particular returns, or claims or reports and the items thereof. This subsection does not prohibit employees or agents of the department of revenue from offering or submitting any return, including joint returns of a spouse or former spouse, separate returns of a spouse, individual returns of a spouse or former spouse, and combined individual income tax returns, or from offering or submitting any claim, schedule, exhibit, writing, or audit report or a copy of, and any information derived from, any of those documents as evidence into the record of any contested matter involving the department in proceedings or litigation on state tax matters if, in the department's judgment, that evidence has reasonable probative value.

SB720,39 Section 39. 71.78 (11) of the statutes is created to read:

SB720,25,9 71.78 (11) Pass-through entity audits. If the department audits a pass-through entity for the income or franchise taxes of its pass-through members, including when an election is made under s. 71.21 (6) (a) or 71.365 (4m) (a) to pay tax at the entity level, the department may disclose the following:

SB720,25,14 (a) To a pass-through member that the pass-through entity is under audit or was audited, if the disclosure is necessary to explain any amounts assessed or refunded to the pass-through member or to obtain information necessary to determine the proper amount of adjustment to make at the pass-through entity level.

SB720,25,20 (b) To a pass-through entity, the identities of one or more members who have failed to report pass-through items originating with the entity on their Wisconsin returns, if the disclosure is necessary to explain any amounts assessed or refunded to the pass-through entity or to obtain information about a pass-through member's return in order to determine the proper amount of adjustment to make at the pass-through entity level.

SB720,40 Section 40. 71.80 (26) of the statutes is created to read:

SB720,26,8 71.80 (26) Tax matters member of a pass-through entity. (a) Each pass-through entity filing a return in this state under this chapter shall designate one pass-through member as the tax matters member on the pass-through entity's return filed in this state for each taxable year. If no tax matters member is designated on the return or no return is filed, the pass-through entity shall appoint a tax matters member no later than 30 days after a written request by the department. If no member is so appointed, the department may designate the tax matters member and notify the pass-through entity in writing of the designation. The pass-through entity may at any time provide a written statement designating a new tax matters member and the department shall accept it if it is signed by an authorized agent of the pass-through entity. The tax matters member for this state may be different from the entity's federal tax matters member.

SB720,26,11 (b) With regard to a department audit of a pass-through entity for income or franchise taxes, the tax matters member has the power and duty to do all of the following:

SB720,26,14 1. Act as the sole authority on behalf of the pass-through entity with respect to the year under review. The pass-through members are bound by actions of the tax matters member under this subdivision.

SB720,26,17 2. Provide the department sufficient information to identify each pass-through member, and the profits interest of each pass-through member, for each taxable year affected by the audit.

SB720,26,19 3. Represent the pass-through entity and keep all pass-through members informed.

SB720,26,21 4. Enter extension agreements on behalf of the pass-through entity under s. 71.77 (5).

SB720,26,22 5. Receive pass-through entity adjustment notices.

SB720,26,25 6. Notify all pass-through members of their share of corrections and adjustments made to the pass-through entity within 90 days after the final determination date of the notice.

SB720,27,1 7. File appeals of pass-through entity adjustment notices.

SB720,27,3 8. Enter a settlement agreement related to pass-through entity items from the entity that is binding on the pass-through members.

SB720,27,5 (c) The tax matters member may delegate the powers and duties under par. (b) to an authorized agent.

SB720,41 Section 41. 71.80 (27) of the statutes is created to read:

SB720,27,15 71.80 (27) Exception to pass-through entity level assessment. No later than 60 days after receipt of the department's audit determination, in a manner prescribed by the department, a pass-through entity with 5 or fewer members for all years under review may elect an audit assessment to be assessed separately to each pass-through member. This subsection does not apply to a pass-through entity if one or more of its members is a pass-through entity for any year under review or if the pass-through entity has made an election for the taxable year under s. 71.21 (6) (a) or 71.365 (4m) (a). The election under this subsection does not dismiss the duties of a tax matters member provided under sub. (26) (a) and (b) 2., 3., and 6.

SB720,42 Section 42. 71.83 (1) (a) 12. of the statutes is created to read:

SB720,27,23 71.83 (1) (a) 12. `Incomplete or incorrect pass-through entity return.' If any pass-through entity, as defined in s. 71.738 (3c), required under this chapter to file a return files an incomplete or incorrect return, the department, upon a showing by the department under s. 73.16 (4), shall assess the pass-through entity an amount equal to 25 percent of the amount of tax assessed under s. 71.745. The amount shall be assessed, levied, and collected in the same manner as additional income or franchise taxes.

SB720,43 Section 43. 71.87 of the statutes is amended to read:

SB720,28,6 71.87 Definition. In this subchapter, “person feeling aggrieved" and “person aggrieved" include includes a pass-through entity, as defined in s. 71.738 (3c), and the spouse of a person against whom an additional assessment was made or who was denied a claim for refund for a taxable year for which a separate return was filed and include either spouse for a taxable year for which a joint return was filed or, if no return was filed, a joint return could have been filed.

SB720,44 Section 44. 73.0305 of the statutes is amended to read:

SB720,28,14 73.0305 Revenue limits calculations. The department of revenue shall annually determine and certify to the state superintendent of public instruction, no later than the 4th Monday in June at the superintendent's request, the allowable rate of increase under subch. VII of ch. 121. The allowable rate of increase is the percentage change, if not negative, in the consumer price index for all urban consumers, U.S. city average, between the preceding March 31 and the 2nd preceding March 31, as computed by the federal department of labor.

SB720,45 Section 45. 73.09 (4) (c) of the statutes is amended to read:

SB720,28,22 73.09 (4) (c) Recertification is contingent upon submission of an application for renewal, at least 60 days before the expiration date of the current certificate, attesting to the completion of the requirements specified in par. (b). Persons applying for renewal on the basis of attendance at the meetings called by the department under s. 73.06 (1) and by meeting continuing education requirements shall submit a $20 recertification fee, in an amount determined by the department not to exceed $75, with their applications.

SB720,46 Section 46. 73.09 (5) of the statutes is amended to read: