Section 2.957. Relocated business credit or deduction.

 

(1)   Purpose. The purpose of this section is to prescribe the method by which the percentage of the workforce payroll of a business and the dollar amount of wages paid to such workforce moved to this state during a taxable year shall be determined for purposes of ss. 71.05 (6) (b) 47. , 71.28 (9s) , and 71.47 (9s) , Stats.; provide examples of actions that may indicate a business has relocated to this state from another state or country; and limit the deduction provided for in s. 71.05 (6) (b) 47. am. , b. , and c. , Stats.

(2)   Definitions. In this section:

(a) "Business" means any organization or enterprise operated for profit, including a sole proprietorship, partnership, firm, business trust, joint venture, syndicate, corporation, limited liability company, or association.

(b) "Doing business in this state" has the meaning given in s. 71.22 (1r) , Stats.

(c) "Employee" has the meaning given in section 3121 (d) of the Internal Revenue Code.

(d) "Taxable year" has the meaning given in ss. 71.01 (12) , 71.22 (10) , and 71.42 (5) , Stats.

(e) "Wages" has the meaning given in section 3121 (a) of the Internal Revenue Code.

(3)   Relocation to this state. For purposes of ss. 71.05 (6) (b) 47. , 71.28 (9s) , and 71.47 (9s) , Stats., actions that may indicate a business has relocated to this state from another state or country include the following:

(a) Registering with the department, as provided in s. 73.03 (50) , Stats.

(b) Registering to do business in Wisconsin with the department of financial institutions.

(4)   Doing business in this state. For purposes of ss. 71.05 (6) (b) 47. , 71.28 (9s) , and 71.47 (9s) , Stats., doing business in this state for any portion of a taxable year means doing business in this state for the entire taxable year, as provided in s. 71.22 (1r) , Stats.

(5)   Workforce payroll. For purposes of ss. 71.05 (6) (b) 47. a. , 71.28 (9s) (a) 2. , and 71.47 (9s) (a) 2. , Stats., the determination as to whether 51% or more of the workforce payroll of a business has moved to this state during a taxable year shall be made using a fraction, the numerator of which is the total amount of wages paid by the business during the taxable year to employees of the business who are residents of this state, and the denominator of which is the total amount of wages paid by the business during the taxable year to all employees of the business.

Example: During the taxable year in which Business A begins doing business in Wisconsin, Business A pays $6,000,000 of wages to employees of Business A who are residents of Wisconsin and $10,000,000 of total wages to all employees of Business A. Sixty (60) percent of the workforce payroll of Business A moved to Wisconsin during the taxable year (6,000,000/10,000,000).

(6)   Workforce wages. For purposes of ss. 71.05 (6) (b) 47. a. , 71.28 (9s) (a) 2. , and 71.47 (9s) (a) 2. , Stats., the determination as to whether at least $200,000 of wages paid to the workforce of a business has moved to this state during a taxable year shall be made using the total amount of wages paid by the business during the taxable year to employees of the business who are residents of this state.

Example: During the taxable year in which Business B begins doing business in Wisconsin, Business B pays $250,000 of wages to employees of Business B who are residents of Wisconsin. Wages of $250,000 paid to the workforce of Business B moved to Wisconsin during the taxable year.

(7)   Limitations on credit and deduction.

(a) No modification may be made under s. 71.05 (6) (b) 47. am. , b. , or c. , Stats., if the amount otherwise eligible for the modification is less than zero.

(b) The credit or deduction under this section may not be claimed by a business that relocates to Wisconsin in a taxable year beginning after December 31, 2013.

Example: Partner B determines the amount otherwise eligible for the modification under s. 71.05 (6) (b) 47. b. , Stats., is a loss of $5,000. Partner B may not make a modification under s. 71.05 (6) (b) 47. b. , Stats.

EmR1104 : emerg. cr. eff. 4-7-11; CR 11-023 : cr. Register November 2011 No. 671 , eff. 12-1-11; CR 14-005 : am. (7) (title), renum. (7) to (7) (a), cr. (7) (b) Register August 2014 No. 704 , eff. 9-1-14.