SB74,3,5

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1(b) Filing claims. Subject to the limitations provided under this subsection and
2s. 560.207, for taxable years beginning after December 31, 2006, a claimant may
3claim as a credit against the tax imposed under s. 71.02, up to the amount of the tax,
4an amount that is equal to the following costs paid by the claimant in the taxable
5year:

SB74,3,106 1. Except as provided in subd. 3., 75 percent of the costs of acquiring,
7constructing, reconstructing, rehabilitating, renovating, enlarging, or improving a
8project facility or eligible innovation project and 75 percent of the costs of all of the
9following related to creating and operating a project facility or to creating and
10maintaining an eligible innovation project:

SB74,3,1311 a. Designs, plans, specifications, surveys, studies, estimates, and any similar
12services or items that are necessary or incidental to determining the feasibility or
13practicality of a project facility or eligible innovation project.

SB74,3,1414 b. Site clearance and preparation.

SB74,3,1515 c. Architectural, engineering, or legal services.

SB74,3,1616 d. Marketing products.

SB74,3,1917 2. The costs of equipping a project facility and the costs of all of the following
18related to creating and operating a project facility or to creating and maintaining an
19eligible innovation project:

SB74,3,2020 a. Research and development.

SB74,3,2121 b. Computer software or hardware.

SB74,3,2222 c. Product testing and other quality control activities.

SB74,3,2323 d. Perfecting products.

SB74,3,2424 e. Creating and protecting intellectual property.

SB74,4,4

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13. If the project facility or eligible innovation project is a brownfield or located
2in a blighted area, and if the brownfield or blighted area is not otherwise being
3remediated with moneys received from the state, 100 percent of the costs described
4in subd. 1.

SB74,4,65 (c) Limitations. 1. The maximum amount of the credit that a claimant may
6claim under this subsection in a taxable year is $500,000.

SB74,4,87 2. The maximum amount of the credits that may be awarded under this
8subsection and ss. 71.28 (5j) and 71.47 (5j) in each year is $10,000,000.

SB74,4,169 3. Partnerships, limited liability companies, and tax-option corporations may
10not claim the credit under this subsection, but the eligibility for, and the amount of,
11the credit are based on their payment of amounts under par. (b). A partnership,
12limited liability company, or tax-option corporation shall compute the amount of
13credit that each of its partners, members, or shareholders may claim and shall
14provide that information to each of them. Partners, members of limited liability
15companies, and shareholders of tax-option corporations may claim the credit in
16proportion to their ownership interests.

SB74,4,1817 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
18s. 71.28 (4), applies to the credit under this subsection.

SB74,4,2020 71.10 (4) (gwd) Innovation projects and facilities credit under s. 71.07 (5j).

SB74,4,2422 71.21 (4) Credits computed by a partnership under s. 71.07 (2dd), (2de), (2di),
23(2dj), (2dL), (2dm), (2ds), (2dx), (3g), (3n), (3s), (3t), (3w), (5b), (5e), (5f), (5g), and (5h),
24and (5j) and passed through to partners shall be added to the partnership's income.

SB74,5,18

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171.26 (2) (a) Corporations in general. The "net income" of a corporation means
2the gross income as computed under the Internal Revenue Code as modified under
3sub. (3) minus the amount of recapture under s. 71.28 (1di) plus the amount of credit
4computed under s. 71.28 (1), (3), (4), and (5) minus, as provided under s. 71.28 (3) (c)
57., the amount of the credit under s. 71.28 (3) that the taxpayer added to income
6under this paragraph at the time that the taxpayer first claimed the credit plus the
7amount of the credit computed under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm),
8(1ds), (1dx), (3g), (3n), (3t), (3w), (5b), (5e), (5f), (5g), and (5h), and (5j) and not passed
9through by a partnership, limited liability company, or tax-option corporation that
10has added that amount to the partnership's, limited liability company's, or
11tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) plus the amount
12of losses from the sale or other disposition of assets the gain from which would be
13wholly exempt income, as defined in sub. (3) (L), if the assets were sold or otherwise
14disposed of at a gain and minus deductions, as computed under the Internal Revenue
15Code as modified under sub. (3), plus or minus, as appropriate, an amount equal to
16the difference between the federal basis and Wisconsin basis of any asset sold,
17exchanged, abandoned, or otherwise disposed of in a taxable transaction during the
18taxable year, except as provided in par. (b) and s. 71.45 (2) and (5).

SB74,5,2120 71.28 (5j) Innovation projects and facilities credit. (a) Definitions. In this
21subsection:

SB74,5,2222 1. "Blighted area" has the meaning given in s. 66.1331 (3) (a).

SB74,5,2423 2. "Brownfield" means an industrial or commercial facility the expansion or
24redevelopment of which is complicated by environmental contamination.

SB74,6,2

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13. "Claimant" means a person who is certified to receive tax credits under s.
2560.206 and who files a claim under this subsection.

SB74,6,53 4. "Eligible innovation project" means any real property, tangible personal
4property, or intangible property related to a new product or process that is based on
5new technology or the creative application of existing technology.

SB74,6,96 5. "Project facility" means any facility located in this state that is operated for
7the purpose of creating and maintaining an eligible innovation project, if the
8operation of the facility is likely to create new jobs, or preserve existing jobs, in this
9state, as determined by the department of commerce.

SB74,6,1410 (b) Filing claims. Subject to the limitations provided under this subsection and
11s. 560.207, for taxable years beginning after December 31, 2006, a claimant may
12claim as a credit against the tax imposed under s. 71.23, up to the amount of the tax,
13an amount that is equal to the following costs paid by the claimant in the taxable
14year:

SB74,6,1915 1. Except as provided in subd. 3., 75 percent of the costs of acquiring,
16constructing, reconstructing, rehabilitating, renovating, enlarging, or improving a
17project facility or eligible innovation project and 75 percent of the costs of all of the
18following related to creating and operating a project facility or to creating and
19maintaining an eligible innovation project:

SB74,6,2220 a. Designs, plans, specifications, surveys, studies, estimates, and any similar
21services or items that are necessary or incidental to determining the feasibility or
22practicality of a project facility or eligible innovation project.

SB74,6,2323 b. Site clearance and preparation.

SB74,6,2424 c. Architectural, engineering, or legal services.

SB74,6,2525 d. Marketing products.

SB74,7,3

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12. The costs of equipping a project facility and the costs of all of the following
2related to creating and operating a project facility or to creating and maintaining an
3eligible innovation project:

SB74,7,44 a. Research and development.

SB74,7,55 b. Computer software or hardware.

SB74,7,66 c. Product testing and other quality control activities.

SB74,7,77 d. Perfecting products.

SB74,7,88 e. Creating and protecting intellectual property.

SB74,7,129 3. If the project facility or eligible innovation project is a brownfield or located
10in a blighted area, and if the brownfield or blighted area is not otherwise being
11remediated with moneys received from the state, 100 percent of the costs described
12in subd. 1.

SB74,7,1413 (c) Limitations. 1. The maximum amount of the credit that a claimant may
14claim under this subsection in a taxable year is $500,000.

SB74,7,1615 2. The maximum amount of the credits that may be awarded under this
16subsection and ss. 71.07 (5j) and 71.47 (5j) in each year is $10,000,000.

SB74,7,2417 3. Partnerships, limited liability companies, and tax-option corporations may
18not claim the credit under this subsection, but the eligibility for, and the amount of,
19the credit are based on their payment of amounts under par. (b). A partnership,
20limited liability company, or tax-option corporation shall compute the amount of
21credit that each of its partners, members, or shareholders may claim and shall
22provide that information to each of them. Partners, members of limited liability
23companies, and shareholders of tax-option corporations may claim the credit in
24proportion to their ownership interests.

SB74,8,2

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1(d) Administration. Subsection (4) (e) to (h), as it applies to the credit under
2sub. (4), applies to the credit under this subsection.

SB74,8,44 71.30 (3) (eor) Innovation projects and facilities credit under s. 71.28 (5j).

SB74,8,96 71.34 (1) (g) An addition shall be made for credits computed by a tax-option
7corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (3), (3g),
8(3n), (3t), (3w), (5b), (5e), (5f), (5g), and (5h) , and (5j) and passed through to
9shareholders.

SB74,8,1611 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
12computed under s. 71.47 (1dd) to (1dx), (3n), (3w), (5b), (5e), (5f), (5g), and (5h), and
13(5j) and not passed through by a partnership, limited liability company, or tax-option
14corporation that has added that amount to the partnership's, limited liability
15company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) and
16the amount of credit computed under s. 71.47 (1), (3), (3t), (4), and (5).

SB74,8,1918 71.47 (5j) Innovation projects and facilities credit. (a) Definitions. In this
19subsection:

SB74,8,2020 1. "Blighted area" has the meaning given in s. 66.1331 (3) (a).

SB74,8,2221 2. "Brownfield" means an industrial or commercial facility the expansion or
22redevelopment of which is complicated by environmental contamination.

SB74,8,2423 3. "Claimant" means a person who is certified to receive tax credits under s.
24560.206 and who files a claim under this subsection.

SB74,9,3

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14. "Eligible innovation project" means any real property, tangible personal
2property, or intangible property related to a new product or process that is based on
3new technology or the creative application of existing technology.

SB74,9,74 5. "Project facility" means any facility located in this state that is operated for
5the purpose of creating and maintaining an eligible innovation project, if the
6operation of the facility is likely to create new jobs, or preserve existing jobs, in this
7state, as determined by the department of commerce.

SB74,9,128 (b) Filing claims. Subject to the limitations provided under this subsection and
9s. 560.207, for taxable years beginning after December 31, 2006, a claimant may
10claim as a credit against the tax imposed under s. 71.43, up to the amount of the tax,
11an amount that is equal to the following costs paid by the claimant in the taxable
12year:

SB74,9,1713 1. Except as provided in subd. 3., 75 percent of the costs of acquiring,
14constructing, reconstructing, rehabilitating, renovating, enlarging, or improving a
15project facility or eligible innovation project and 75 percent of the costs of all of the
16following related to creating and operating a project facility or to creating and
17maintaining an eligible innovation project:

SB74,9,2018 a. Designs, plans, specifications, surveys, studies, estimates, and any similar
19services or items that are necessary or incidental to determining the feasibility or
20practicality of a project facility or eligible innovation project.

SB74,9,2121 b. Site clearance and preparation.

SB74,9,2222 c. Architectural, engineering, or legal services.

SB74,9,2323 d. Marketing products.

SB74,10,3

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12. The costs of equipping a project facility and the costs of all of the following
2related to creating and operating a project facility or to creating and maintaining an
3eligible innovation project:

SB74,10,44 a. Research and development.

SB74,10,55 b. Computer software or hardware.

SB74,10,66 c. Product testing and other quality control activities.

SB74,10,77 d. Perfecting products.

SB74,10,88 e. Creating and protecting intellectual property.

SB74,10,129 3. If the project facility or eligible innovation project is a brownfield or located
10in a blighted area, and if the brownfield or blighted area is not otherwise being
11remediated with moneys received from the state, 100 percent of the costs described
12in subd. 1.

SB74,10,1413 (c) Limitations. 1. The maximum amount of the credit that a claimant may
14claim under this subsection in a taxable year is $500,000.

SB74,10,1615 2. The maximum amount of the credits that may be awarded under this
16subsection and ss. 71.07 (5j) and 71.28 (5j) in each year is $10,000,000.

SB74,10,2417 3. Partnerships, limited liability companies, and tax-option corporations may
18not claim the credit under this subsection, but the eligibility for, and the amount of,
19the credit are based on their payment of amounts under par. (b). A partnership,
20limited liability company, or tax-option corporation shall compute the amount of
21credit that each of its partners, members, or shareholders may claim and shall
22provide that information to each of them. Partners, members of limited liability
23companies, and shareholders of tax-option corporations may claim the credit in
24proportion to their ownership interests.

SB74,11,2

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1(d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
2s. 71.28 (4), applies to the credit under this subsection.

SB74,11,44 71.49 (1) (eor) Innovation projects and facilities credit under s. 71.47 (5j).

SB74,11,206 77.92 (4) "Net business income," with respect to a partnership, means taxable
7income as calculated under section 703 of the Internal Revenue Code; plus the items
8of income and gain under section 702 of the Internal Revenue Code, including taxable
9state and municipal bond interest and excluding nontaxable interest income or
10dividend income from federal government obligations; minus the items of loss and
11deduction under section 702 of the Internal Revenue Code, except items that are not
12deductible under s. 71.21; plus guaranteed payments to partners under section 707
13(c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de),
14(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g), (3s), (3n), (3t), (3w), (5b), (5e), (5f),
15(5g), and (5h), and (5j); and plus or minus, as appropriate, transitional adjustments,
16depreciation differences, and basis differences under s. 71.05 (13), (15), (16), (17), and
17(19); but excluding income, gain, loss, and deductions from farming. "Net business
18income," with respect to a natural person, estate, or trust, means profit from a trade
19or business for federal income tax purposes and includes net income derived as an
20employee as defined in section 3121 (d) (3) of the Internal Revenue Code.

SB74,12,7 22560.207 Innovation projects and facilities program. (1) Innovation
23projects and facilities tax credits. The department shall implement a program to
24certify businesses for purposes of ss. 71.07 (5j), 71.28 (5j), and 71.47 (5j). A business
25desiring certification shall submit an application to the department in each taxable

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1year for which the business desires certification. For the purpose of certifying
2businesses under this subsection for taxable years beginning after December 31,
32006, and before January 1, 2009, the department shall give priority to businesses
4that use biotechnology or nanotechnology. Unless otherwise provided under the
5rules of the department, a business may be certified under this subsection, and may
6maintain such certification, only if the business satisfies all of the following
7conditions:

SB74,12,88 (a) It conducts business in this state.

SB74,12,109 (b) At least 51 percent of the employees employed by the business are employed
10in this state.

SB74,12,1311 (c) It is engaged in, or has committed to engage in, manufacturing, agriculture,
12or processing or assembling products and conducting research and development or
13developing a new product or business process.

SB74,12,1714 (d) It is not engaged in real estate development, insurance, banking, lending,
15lobbying, political consulting, professional services provided by attorneys,
16accountants, business consultants, physicians, or health care consultants, wholesale
17or retail trade, leisure, hospitality, transportation, or construction.

SB74,12,20 18(2) Administration. (a) The department shall maintain a list of businesses
19certified under sub. (1) and shall permit public access to the lists through the
20department's Web site.

SB74,12,2321 (b) The department of commerce shall notify the department of revenue of
22every certification issued under sub. (1) and the date on which any such certification
23is revoked or expires.