2023 - 2024 LEGISLATURE
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2023 SENATE BILL 1021
February 13, 2024 - Introduced by Senator MARKLEIN, cosponsored by
Representative WITTKE. Referred to Committee on Universities and Revenue.
1 AN ACT to renumber and amend 77.60 (1) (a) and 77.60 (1) (b); to amend 70.38
2 (1m), 71.03 (7) (intro.), 71.24 (7) (a), 71.44 (3) (a), 71.775 (4) (bm) 1., 71.775 (4)
3 (bm) 2., 71.775 (4) (em), 71.82 (1), 71.82 (2) (b), 71.82 (2) (d), 71.84 (1), 71.84 (2)
4 (a), 71.84 (2) (b), 71.84 (2) (c), 71.90 (1), 71.91 (6) (e) 3., 71.91 (6) (f) 5., 73.03 (6),
5 76.075, 76.13 (2), 76.13 (2a), 76.13 (3), 76.22 (2), 76.28 (4) (a), 76.28 (4) (b), 76.28
6 (11), 76.39 (4) (d), 76.48 (5), 77.59 (6) (c), 77.96 (5), 78.68 (1), 139.25 (1), 139.44
7 (9), 168.12 (6) (c), 168.12 (6) (d) 2., 168.12 (6) (e) 1. and 168.12 (6) (e) 3.; and to
8 create 77.60 (1) (b) 2. of the statutes; relating to: interest rates on late,
9 nondelinquent taxes and on overpayments.
Analysis by the Legislative Reference Bureau
This bill modifies the interest rates applicable to various late, nondelinquent
taxes and fees owed to the Department of Revenue and to overpayments for those
taxes and fees that are refunded by DOR. Under current law, generally, late,
nondelinquent taxes or fees administered by DOR are subject to an interest rate of
12 percent per year, and DOR must pay interest at the rate of 3 percent per year on
refunds of overpayments of those taxes or fees. Under the bill, the interest rate for
late, nondelinquent taxes or fees administered by DOR is 6 percent per year, and
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SENATE BILL 1021
DOR must pay interest at the rate of 6 percent per year on refunds of overpayments.
The bill applies to the following taxes and fees: 1) the individual income and
corporate income and franchise tax; 2) the withholding; 3) the sales and use tax; 4)
taxes paid by utilities and insurers; 5) excises taxes on motor vehicle fuel, alcohol
beverages, and cigarettes, tobacco, and vapor products; 6) the economic development
surcharge; 7) the petroleum inspection fee; 8) the metalliferous mining tax; and 9)
the charge imposed by DOR on a city, village, town, or county for the expenses
incurred by DOR in examining city, village, town, or county records regarding the
assessment of property upon failure to return information requested by DOR.
Also, current law requires that an interest rate of 12 percent per year apply to
delinquent individual income and corporate income and franchise taxes in instances
in which the secretary of DOR determines that reduction from an interest rate of 1.5
percent per month for such delinquent taxes is fair and equitable. The bill requires
that an interest rate of 6 percent per year apply to such delinquent taxes in instances
in which the DOR secretary determines that the reduction is fair and equitable.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
1 SECTION 1. 70.38 (1m) of the statutes is amended to read:
2 70.38 (1m) ESTIMATED LIABILITY. Upon written request and for sufficient reason
3 shown, the department shall allow a person subject to the tax under s. 70.375 to file,
4 on or before June 15, a net proceeds tax return and to pay that tax based upon
5 estimated tax liability. On or before September 15, that person shall file a final report
6 and pay any additional tax due along with interest at the rate of 1 0.5 percent per
7 month from June 15 until the date of payment. If the additional tax exceeds 10
8 percent of the person's tax under s. 70.375 for the previous year, the penalty and
9 interest under s. 70.39 (1) apply. If the final report indicates that the person overpaid
10 the person's liability, the department shall refund the overpayment.
11 SECTION 2. 71.03 (7) (intro.) of the statutes is amended to read:
12 71.03 (7) EXTENSION OF TIME TO FILE. (intro.) Returns of natural persons and
13 fiduciaries that require a statement of amounts or information contained or entered
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SENATE BILL 1021 SECTION 2
1 on a corresponding return under the internal revenue code shall be filed within the
2 time fixed under that code for filing of the corresponding federal return. Any
3 extension of time granted by law or by the internal revenue service for the filing of
4 that corresponding federal return extends the time for filing under this chapter if a
5 copy of the taxpayer's application to the internal revenue service requesting the
6 extension is filed with the return under this chapter or if a copy of any request for
7 an extension required by the internal revenue service is filed with the return under
8 this chapter or at an earlier date that the department prescribes by rule and if the
9 taxpayer pays the Wisconsin tax in the manner applicable to federal income taxes
10 under the internal revenue code. Taxes payable upon the filing of the return do not
11 become delinquent during the period of an extension but are subject to interest at the
12 rate of 12 6 percent per year during such period except as follows:
13 SECTION 3. 71.24 (7) (a) of the statutes is amended to read:
14 71.24 (7) (a) In the case of a corporation required to file a return, the
15 department of revenue shall allow an automatic extension of 7 months or until the
16 original due date of the corporation's corresponding federal return, whichever is
17 later. Any extension of time granted by law or by the internal revenue service for the
18 filing of corresponding federal returns shall extend the time for filing under this
19 subchapter to 30 days after the federal due date if the corporation reports the
20 extension in the manner specified by the department on the return. Except for
21 payments of estimated taxes, income or franchise taxes payable upon the filing of the
22 tax return shall not become delinquent during such extension period, but shall,
23 except as provided in par. (b), be subject to interest at the rate of 12 6 percent per year
24 during such period.
25 SECTION 4. 71.44 (3) (a) of the statutes is amended to read:
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SENATE BILL 1021 SECTION 4
1 71.44 (3) (a) In the case of a corporation required to file a return, the
2 department of revenue shall allow an automatic extension of 7 months or until the
3 original due date of the corporation's corresponding federal return, whichever is
4 later. Any extension of time granted by law or by the internal revenue service for the
5 filing of corresponding federal returns shall extend the time for filing under this
6 subchapter to 30 days after the federal due date if the corporation reports the
7 extension in the manner specified by the department on the return. Except for
8 payments of estimated taxes, income or franchise taxes payable upon the filing of the
9 tax return shall not become delinquent during such extension period, but shall,
10 except as provided in par. (b), be subject to interest at the rate of 12 6 percent per year
11 during such period.
12 SECTION 5. 71.775 (4) (bm) 1. of the statutes is amended to read:
13 71.775 (4) (bm) 1. For the return under par. (a), the department shall allow an
14 automatic extension of 7 months or until the corresponding due date of the
15 pass-through entity's federal income tax return or return of partnership income,
16 whichever is later. Except for payments of estimated taxes, and except as provided
17 in subd. 2., withholding taxes payable upon filing the return are not delinquent
18 during the extension period but shall be subject to interest at the rate of 12 6 percent
19 per year during that period.
20 SECTION 6. 71.775 (4) (bm) 2. of the statutes is amended to read:
21 71.775 (4) (bm) 2. For taxable years beginning after December 31, 2008, for
22 persons who qualify for a federal extension of time to file under 26 USC 7508A due
23 to a presidentially declared disaster or terroristic or military action, withholding
24 taxes that are otherwise due from a pass-through entity under sub. (2) are not
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SENATE BILL 1021 SECTION 6
1 subject to 12 6 percent interest as otherwise provided under subd. 1. during the
2 extension period and for 30 days after the end of the federal extension period.
3 SECTION 7. 71.775 (4) (em) of the statutes is amended to read:
4 71.775 (4) (em) Except as provided in par. (fm), in the case of any underpayment
5 of estimated withholding taxes under par. (cm), interest shall be added to the
6 aggregate withholding tax for the taxable year at the rate of 12 6 percent per year
7 on the amount of the underpayment for the period of the underpayment. In this
8 paragraph, “period of the underpayment" means the time period beginning with the
9 due date of the installment and ending on either the unextended due date of the
10 return under par. (a) or the date of payment, whichever is earlier. If 90 percent of
11 the tax due under sub. (2) for the taxable year is not paid by the unextended due date
12 of the return under par. (a), the difference between that amount and the estimated
13 taxes paid, along with any interest due, shall accrue delinquent interest in the same
14 manner as income and franchise taxes under s. 71.82 (2) (a).
15 SECTION 8. 71.82 (1) of the statutes is amended to read:
16 71.82 (1) NORMAL. (a) In assessing taxes interest shall be added to such taxes
17 at 12 6 percent per year from the date on which such taxes if originally assessed
18 would have become delinquent if unpaid, to the date on which such taxes when
19 subsequently assessed will become delinquent if unpaid.
20 (b) Except as otherwise specifically provided, in crediting overpayments of
21 income and surtaxes against underpayments or against taxes to be subsequently
22 collected and in certifying refunds of such taxes interest shall be added at the rate
23 of 3 6 percent per year from the date on which such taxes when assessed would have
24 become delinquent if unpaid to the date on which such overpayment was certified for
25 refund except that if any overpayment of tax is certified for refund within 90 days
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SENATE BILL 1021 SECTION 8
1 after the last date prescribed for filing the return of such tax or 90 days after the date
2 of actual filing of the return of such tax, whichever occurs later, no interest shall be
3 allowed on such overpayment. For purposes of this section the return of such tax
4 shall not be deemed actually filed by an employee unless and until the employee has
5 included the written statement required to be filed under s. 71.65 (1). However when
6 any part of a tax paid on an estimate of income, whether paid in connection with a
7 tentative return or not, is refunded or credited to a taxpayer, such refund or credit
8 shall not draw interest.
9 (c) Any assessment made as a result of the adjustment or disallowance of a
10 claim for credit under s. 71.07, 71.28 or 71.47 or subch. VIII or IX, except as provided
11 in sub. (2) (c), shall bear interest at 12 6 percent per year from the due date of the
12 claim.
13 SECTION 9. 71.82 (2) (b) of the statutes is amended to read:
14 71.82 (2) (b) Department may reduce delinquent interest. The department shall
15 provide by rule for reduction of interest under par. (a) to 12 6 percent per year in
16 stated instances wherein the secretary of revenue determines that reduction is fair
17 and equitable.
18 SECTION 10. 71.82 (2) (d) of the statutes is amended to read:
19 71.82 (2) (d) Withholding tax. Of the amounts required to be withheld any
20 amount not deposited or paid over to the department within the time required shall
21 be deemed delinquent and deposit reports or withholding reports filed after the due
22 date shall be deemed late. Delinquent deposits or payments shall bear interest at
23 the rate of 1.5 percent per month from the date deposits or payments are required
24 under this section until deposited or paid over to the department. The department
25 shall provide by rule for reduction of interest on delinquent deposits to 12 6 percent
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SENATE BILL 1021 SECTION 10
1 per year in stated instances wherein the secretary of revenue determines reduction
2 fair and equitable. In the case of a timely filed deposit or withholding report,
3 withheld taxes shall become delinquent if not deposited or paid over on or before the
4 due date of the report. In the case of no report filed or a report filed late, withheld
5 taxes shall become delinquent if not deposited or paid over by the due date of the
6 report. In the case of an assessment under s. 71.83 (1) (b) 2., the amount assessed
7 shall become delinquent if not paid on or before the first day of the calendar month
8 following the calendar month in which the assessment becomes final, but if the
9 assessment is contested before the tax appeals commission or in the courts, it shall
10 become delinquent on the 30th day following the date on which the order or judgment
11 representing final determination becomes final.
12 SECTION 11. 71.84 (1) of the statutes is amended to read:
13 71.84 (1) INDIVIDUALS AND FIDUCIARIES. Except as provided in s. 71.09 (11), in
14 the case of any underpayment of estimated tax by an individual, estate or trust,
15 except as provided under s. 71.09, there shall be added to the aggregate tax for the
16 taxable year interest at the rate of 12 6 percent per year on the amount of the
17 underpayment for the period of the underpayment. In this subsection, “the period
18 of the underpayment" means the time period from the due date of the installment
19 until either the 15th day of the 4th month beginning after the end of the taxable year
20 or the date of payment, whichever is earlier.
21 SECTION 12. 71.84 (2) (a) of the statutes is amended to read:
22 71.84 (2) (a) Except as provided in s. 71.29 (7), in the case of any underpayment
23 of estimated tax by a corporation under s. 71.29 or 71.48, there shall be added to the
24 aggregate tax for the taxable year interest at the rate of 12 6 percent per year on the
25 amount of the underpayment for the period of the underpayment. In this paragraph,
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SENATE BILL 1021 SECTION 12
1 “period of the underpayment" means the time period from the due date of the
2 installment until either the date on which the corporation is required to file for
3 federal income tax purposes, not including any extension, under the Internal
4 Revenue Code or the date of payment, whichever is earlier. If 90 percent of the tax
5 shown on the return is not paid by the date on which the corporation is required to
6 file for federal income tax purposes, not including any extension, under the Internal
7 Revenue Code, the difference between that amount and the estimated taxes paid,
8 along with any interest due, shall accrue delinquent interest under s. 71.91 (1) (a).
9 SECTION 13. 71.84 (2) (b) of the statutes is amended to read:
10 71.84 (2) (b) For corporations that are subject to a tax under this chapter on
11 unrelated business taxable income, as defined under section 512 of the internal
12 revenue code, and virtually exempt entities, “period of the underpayment" means the
13 time period from the due date of the installment until either the 15th day of the 5th
14 month beginning after the end of the taxable year or the date of payment, whichever
15 is earlier. If 90 percent of the tax shown on the return is not paid by the 15th day of
16 the 5th month following the close of the taxable year, the difference between that
17 amount and the estimated taxes paid along with any interest due, shall accrue
18 delinquent interest under s. 71.91 (1) (a).
19 SECTION 14. 71.84 (2) (c) of the statutes is amended to read:
20 71.84 (2) (c) If a refund under s. 71.29 (3m) results in an income or franchise
21 tax liability that is greater than the amount of estimated taxes paid when reduced
22 by the amount of the refund, the taxpayer shall add to the aggregate tax for the
23 taxable year interest at an annual rate of 12 6 percent on the amount of the unpaid