Wisconsin Tax Bulletin - revenue.wi.gov

1 If you would like to receive notification when a new Wisconsin Tax Bulletin is available, subscribe to the sales and use tax or tax professional electronic mailing list. In This Issue New Tax 2 Index .. 2 Income/Franchise Tax Updates and Reminders .. 19 Use the Correct Year Voucher When Filing Form 1-ES .. 19 Territories and Puerto Rico Water's Edge Test and Throwback 19 Wisconsin Form 6 - Reconciliation With Federal Consolidated Return .. 19 Unreimbursed Business Expenses .. 20 Sales/Use Tax Updates and Reminders .. 21 Village of Sister Bay Adopts Premier Resort Area Tax Effective July 1, 2018 .. 21 Construction Contract Exemption .. 21 Reporting Short-Term Lodging .. 23 Homeowners Association Dues May Be Taxable Admissions.

2 24 Purchasers of a Business Beware - Don't Get Stuck With "Successor Liability" .. 25 Other Updates and Reminders .. 25 My Tax Account - NAICS Code Update .. 25 Tax Release .. 26 Sales and Use Tax .. 26 Bundled Transactions .. 26 Private Letter Rulings .. 41 Sales and Use Tax .. 41 Non-Transplantable Human Tissue .. 41 Sales and Use Tax Exempt on Materials Purchased by Construction Contractors Who Incorporate Such Materials into Sanitary Sewer System Located in Wisconsin .. 44 Report on Litigation .. 46 Sales and Use Tax .. 46 Industrial Waste Treatment Facility Exemption Fuel and Electricity Consumed by Air Makeup Unit .. 46 Wisconsin Tax BulletinApril 2018 Number 201 2 Back to Table of Contents Wisconsin Tax Bulletin 201 april 2018 Since the last issue of the Wisconsin Tax Bulletin , the Wisconsin Legislature has enacted a number of changes to the Wisconsin tax laws.

3 Following is an index and brief descriptions of the major individual and fiduciary income tax, corporation franchise and income tax, sales and use tax, excise tax, and other provisions. The description for each provision indicates the sections of the statutes affected and the effective date of the new provision. Index New Tax Laws Effective Date Page A. Individual and/or Fiduciary Income Taxes 1. Internal Revenue Code References Updated for 2017 for Individuals, Estates, and Trusts Taxable years beginning before January 1, 2018 4 2. Internal Revenue Code References Updated for 2018 for Individuals, Estates, and Trusts Taxable years beginning on or after January 1, 2018 4 3. Internal Revenue Code References to Alternative Minimum Tax Updated april 5, 2018 4 4.

4 Internal Revenue Code References for Dependents Updated april 5, 2018 5 5. Depreciation, Depletion, and Amortization Clarification Taxable years beginning on or after January 1, 2014 5 6. Eligible Expenses for College Savings Account april 5, 2018 5 7. Limitation on Private School Tuition Subtraction for Amounts Paid from College Savings Account Taxable years beginning on or after January 1, 2018 5 8. Airline Carrier Bankruptcy Rollover Payments april 5, 2018 6 9. Earned Income Tax Credit Pilot and Permanent Program april 12, 2018 6 B. Corporation Franchise and Income Taxes 1. Internal Revenue Code References Updated for 2017 for Corporations, Nonprofit Organizations, Regulated Entities, Tax-Option (S) Corporations, and Insurance Companies Taxable years beginning before January 1, 2018 7 2.

5 Internal Revenue Code References Updated for 2018 for Corporations, Nonprofit Organizations, Regulated Entities, Tax-Option (S) Corporations, and Insurance Companies Taxable years beginning on or after January 1, 2018 7 3. Depreciation, Depletion, and Amortization Clarification Taxable years beginning on or after January 1, 2014 7 4. Dividend Received Deduction Revised april 5, 2018 8 5. Low-Income Housing Credit Created Taxable years beginning on or after January 1, 2018 8 3 Back to Table of Contents Wisconsin Tax Bulletin 201 april 2018 6. Supplement to Federal Historic Rehabilitation Tax Credit Revised Various 9 7. Employee College Savings Account Contribution Credit Created January 1, 2018 10 8. Standard for Proving Transaction Has Economic Substance Taxable years beginning on or after January 1, 2018 11 9.

6 Statutory Corrections april 18, 2018 12 C. Sales and Use Tax 1. Qualified Child Sales and Use Tax Rebate for 2018 april 19, 2018 12 2. Sales Tax Holiday in August 2018 april 19, 2018 13 3. Exemption for State Veterans Organizations July 1, 2018 14 4. Exemption for Certain Title Holding Entities September 1, 2017 14 5. Expand List of Qualifying Exempt Entities for Building Materials Exemption First applies retroactively to contracts entered into on September 1, 2017 15 6. Exemption for Services Performed During Disaster Period By Electric Cooperatives or Telecommunications Utilities January 1, 2017 16 7. Eliminate Benefit for Sellers That Over-Collect Tax from Consumers First applies to a seller that receives an adjustment or a refund on april 18, 2018 17 D.

7 Withholding Tax 1. Truncated Payee Social Security Number april 18, 2018 17 E. Alcohol and Tobacco Regulations 1. Applications for Alcohol Beverage Licenses and Permits and for Cigarette and Tobacco Products Retailer Licenses July 1, 2018 17 F. Other 1. Unclaimed Property Audits First applies to contracts or agreements entered into, renewed, or modified after april 4, 2018 18 2. Relying on Past Audits Revised Audit determinations issued on or after april 5, 2018 18 3. Electronic Delivery of Notifications april 18, 2018 18 4 Back to Table of Contents Wisconsin Tax Bulletin 201 april 2018 and/or Fiduciary Income Revenue Code References Updated for 2017 for Individuals, Estates, andTrusts(2017 Wis. Act 231, amend sec.)

8 (6)(k)1. and 3., effective for taxable years beginning beforeJanuary 1, 2018)Certain changes to the Internal Revenue Code made by Public Law 115-97, Tax Cuts and Jobs Act of2017, apply for Wisconsin purposes for taxable years beginning before January 1, 2018: Section 11024 relating to increase contributions to ABLE accounts Section 11025 relating to rollovers to ABLE programs from 529 programs Section 13543 relating to the modification of treatment of S Corporation conversions toC Revenue Code References Updated for 2018 for Individuals, Estates, andTrusts(2017 Wis. Act 231, create sec. (6)(L), effective for taxable years beginning on or after January 1,2018)For taxable years beginning on or after January 1, 2018, for individuals and fiduciaries, exceptfiduciaries of nuclear decommissioning trust or reserve funds, "Internal Revenue Code" means thefederal Internal Revenue Code as amended to December 31, 2017, except the federal public lawslisted in sec.

9 (6)(L)2., Wis. Stats., do not apply for provisions of federal public laws that directly or indirectly affect the federal Internal Revenue Codeadopted for Wisconsin for taxable years beginning on or after January 1, 2018, apply for Wisconsinpurposes at the same time as for federal purposes. Amendments to the federal Internal Revenue Codeenacted after December 31, 2017, do not apply for chart on the department s website for federal provisions from the federal Tax Cuts and Jobs Actof 2017 (Public Law 115-97) that apply and do not apply for Wisconsin purposes for taxable yearsbeginning on or after December 31, Revenue Code References to Alternative Minimum Tax Updated(2017 Wis. Act 231, amend sec. (1)(d), effective april 5, 2018)The reference to the Internal Revenue Code (IRC) for the subtraction for exemption and exemptionphase- out amounts has been updated to reference sec.

10 55 (d), IRC, as affected by the federal TaxCuts and Jobs Act of 2017. As a result, the Wisconsin exemption and exemption phase-out amountsare the same as federal for taxable years beginning on or after December 31, : Wisconsin no longer has an alternative minimum tax for taxable years beginning on or afterDecember 31, 2018 5 Back to Table of Contents Wisconsin Tax Bulletin 201 april 2018 4. Internal Revenue Code References for Dependents Updated (2017 Wis. Act 231, amend secs. (6)(b)28.(intro.) and , (10)(i)1., and (23)(b)2., effective april 5, 2018) For the following, the definition of a dependent has been updated to a dependent that is defined under sec. 152, IRC. Previously, a dependent was defined as one who was claimed under sec.