Wisconsin Assembly Passes Budget Bill

The Wisconsin Assembly has passed the budget bill for 2017, which would make significant changes to:

  • personal income tax;
  • corporation franchise and income tax; and
  • sales and use tax.

Possible Income Tax Changes

If enacted, the bill would:

  • eliminate the alternative minimum tax;
  • repeal the Working Families Tax Credit;
  • modify references to the Internal Revenue Code (IRC) for tax years beginning after 2016 to include IRC provisions in effect as of December 31, 2016 (with exceptions);
  • generally limit the number of years that filers could retroactively recompute net operating losses to no more than four years following the unextended due date for the taxable year in which the loss occurred;
  • lower the threshold for mandatory electronic filing of wage statements or information returns;
  • change the filing deadlines for certain information returns and the reporting of nonwage payment;
  • modify apportionment provisions for broadcasters; and
  • make modifications to other credits, including the historic rehabilitation tax credit.

Possible Sales and Use Tax Changes

Sales and use tax changes in the passed budget bill include:

  • repealing the tax on internet access charges;
  • expanding the exemption for lump sum contracts to apply to all construction contracts and to subcontractors;
  • a new exemption for certain prepared food sold by retailers;
  • an exemption for certain videos, electronic games, and prizes sold to certain persons in the business of providing amusements;
  • an exemption for equipment used primarily for transmitting or receiving commercial television or radio program material; and
  • increasing the threshold for the occasional sales exemption (currently established by rule) from $1,000 to $2,000 per year.

The text of the bill (including adopted amendments) is available at http://docs.legis.wisconsin.gov/2017/proposals/reg/asm/bill/ab64 .

A.B. 64, as passed by the Wisconsin Assembly on September 13, 2017; Summaries , Wisconsin Legislative Fiscal Bureau, September 2017

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