February 22, 2007 - Introduced by Representatives Moulton, Davis, Vukmir,
Albers, Ballweg, Gronemus, Gunderson, Hahn, Hines, Kramer, Mursau,
Murtha, Nygren, A. Ott, J. Ott, Owens, Petersen, Strachota, Suder,
Townsend, Vos, M. Williams
and Wood, cosponsored by Senators Roessler,
Darling, Schultz, Olsen, Leibham
and Kanavas. Referred to Committee on
Health and Healthcare Reform.
AB111,1,8 1An Act to amend 71.05 (6) (a) 15., 71.21 (4), 71.26 (2) (a), 71.34 (1) (g), 71.45 (2)
2(a) 10. and 77.92 (4); and to create 71.07 (5k), 71.10 (4) (gxx), 71.28 (5k), 71.30
3(3) (epa), 71.47 (5k), 71.49 (1) (epa) and 560.204 of the statutes; relating to:
4income and franchise tax credits for information technology equipment used to
5maintain medical records in electronic form and for interest on bonds or notes
6issued by the Wisconsin Health and Educational Facilities Authority for
7purposes related to the purchase of information technology equipment by
8health facilities, and granting rule-making authority.
Analysis by the Legislative Reference Bureau
This bill creates income and franchise tax credits for the purchase of certain
information technology equipment by health care providers and health facilities.
Under the bill, a health care provider may claim a credit equal to 50 percent of the
amount the provider paid in the taxable year for information technology hardware
or software that is used to maintain medical records in electronic form. Also, under
the bill, a person may claim a credit equal to a percentage, based on the person's
applicable state income and franchise tax rate, of the interest received on bonds and
notes issued by the Wisconsin Health and Educational Facilities Authority, on or
after the effective date of the bill, if the proceeds of the bond or note are used by a
health facility to purchase information technology hardware or software.

For further information see the state and local 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:
AB111, s. 1 1Section 1. 71.05 (6) (a) 15. of the statutes is amended to read:
AB111,2,62 71.05 (6) (a) 15. The amount of the credits computed under s. 71.07 (2dd), (2de),
3(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g), (3n), (3s), (3t), (3w), (5b), (5d), and
4(5e), (5f), and (5h), and (5k) and not passed through by a partnership, limited liability
5company, or tax-option corporation that has added that amount to the partnership's,
6company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g).
AB111, s. 2 7Section 2. 71.07 (5k) of the statutes is created to read:
AB111,2,98 71.07 (5k) Health care information technology credit. (a) Definition. In this
9subsection, "claimant" means a person who files a claim under this subsection.
AB111,2,1210 (b) Filing claims. Subject to the limitations provided in this subsection, a
11claimant may claim as a credit against the taxes imposed under s. 71.02 or 71.08, up
12to the amount of those taxes, the following:
AB111,2,1813 1. An amount equal to 50 percent of the amount the claimant paid in the taxable
14year for information technology hardware or software that is used to maintain
15medical records in electronic form, if the claimant is a health care provider, as defined
16in s. 146.81 (1), and, in the case of software used as the basis for a credit under this
17subsection, if the software is certified by the Certification Commission for
18Healthcare Information Technology.
AB111,3,219 2. An amount equal to 6.5 percent of the interest received by the claimant on
20bonds issued under s. 231.03 (6), on or after the effective date of this subdivision ....
21[revisor inserts date], if the proceeds or notes that are issued are used by a health

1facility, as defined in s. 231.01 (5), to fund the acquisition of information technology
2hardware or software.
AB111,3,53 (c) Limitations. 1. The maximum amount of the credits that may be claimed
4under par. (b) 1. and ss. 71.28 (5k) (b) 1. and 71.47 (5k) (b) 1. in a taxable year is
5$10,000,000, as allocated under s. 560.204.
AB111,3,136 2. Partnerships, limited liability companies, and tax-option corporations may
7not claim the credit under this subsection, but the eligibility for, and the amount of,
8the credit are based on their payment of amounts under par. (b). A partnership,
9limited liability company, or tax-option corporation shall compute the amount of
10credit that each of its partners, members, or shareholders may claim and shall
11provide that information to each of them. Partners, members of limited liability
12companies, and shareholders of tax-option corporations may claim the credit in
13proportion to their ownership interests.
AB111,3,1514 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
15s. 71.28 (4), applies to the credit under this subsection.
AB111, s. 3 16Section 3. 71.10 (4) (gxx) of the statutes is created to read:
AB111,3,1717 71.10 (4) (gxx) Health care information technology credit under s. 71.07 (5k).
AB111, s. 4 18Section 4. 71.21 (4) of the statutes is amended to read:
AB111,3,2119 71.21 (4) Credits computed by a partnership under s. 71.07 (2dd), (2de), (2di),
20(2dj), (2dL), (2dm), (2ds), (2dx), (3g), (3n), (3s), (3t), (3w), (5b), (5e), (5f), (5g), and (5h),
21and (5k)
and passed through to partners shall be added to the partnership's income.
AB111, s. 5 22Section 5. 71.26 (2) (a) of the statutes is amended to read:
AB111,4,1523 71.26 (2) (a) Corporations in general. The "net income" of a corporation means
24the gross income as computed under the Internal Revenue Code as modified under
25sub. (3) minus the amount of recapture under s. 71.28 (1di) plus the amount of credit

1computed under s. 71.28 (1), (3), (4), and (5) minus, as provided under s. 71.28 (3) (c)
27., the amount of the credit under s. 71.28 (3) that the taxpayer added to income
3under this paragraph at the time that the taxpayer first claimed the credit plus the
4amount of the credit computed under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm),
5(1ds), (1dx), (3g), (3n), (3t), (3w), (5b), (5e), (5f), (5g), and (5h), and (5k) and not passed
6through by a partnership, limited liability company, or tax-option corporation that
7has added that amount to the partnership's, limited liability company's, or
8tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) plus the amount
9of losses from the sale or other disposition of assets the gain from which would be
10wholly exempt income, as defined in sub. (3) (L), if the assets were sold or otherwise
11disposed of at a gain and minus deductions, as computed under the Internal Revenue
12Code as modified under sub. (3), plus or minus, as appropriate, an amount equal to
13the difference between the federal basis and Wisconsin basis of any asset sold,
14exchanged, abandoned, or otherwise disposed of in a taxable transaction during the
15taxable year, except as provided in par. (b) and s. 71.45 (2) and (5).
AB111, s. 6 16Section 6. 71.28 (5k) of the statutes is created to read:
AB111,4,1817 71.28 (5k) Health care information technology credit. (a) Definition. In this
18subsection, "claimant" means a person who files a claim under this subsection.
AB111,4,2119 (b) Filing claims. Subject to the limitations provided in this subsection, a
20claimant may claim as a credit against the taxes imposed under s. 71.23, up to the
21amount of those taxes, the following:
AB111,5,222 1. An amount equal to 50 percent of the amount the claimant paid in the taxable
23year for information technology hardware or software that is used to maintain
24medical records in electronic form, if the claimant is a health care provider, as defined
25in s. 146.81 (1), and, in the case of software used as the basis for a credit under this

1subsection, if the software is certified by the Certification Commission for
2Healthcare Information Technology.
AB111,5,73 2. An amount equal to 7.9 percent of the interest received by the claimant on
4obligations issued under s. 231.03 (6), on or after the effective date of this subdivision
5.... [revisor inserts date], if the obligations that are issued are used by a health
6facility, as defined in s. 231.01 (5), to fund the acquisition of information technology
7hardware or software.
AB111,5,108 (c) Limitations. 1. The maximum amount of the credits that may be claimed
9under par. (b) 1. and ss. 71.07 (5k) (b) 1. and 71.47 (5k) (b) 1. in a taxable year is
10$10,000,000, as allocated under s. 560.204.
AB111,5,1811 2. Partnerships, limited liability companies, and tax-option corporations may
12not claim the credit under this subsection, but the eligibility for, and the amount of,
13the credit are based on their payment of amounts under par. (b). A partnership,
14limited liability company, or tax-option corporation shall compute the amount of
15credit that each of its partners, members, or shareholders may claim and shall
16provide that information to each of them. Partners, members of limited liability
17companies, and shareholders of tax-option corporations may claim the credit in
18proportion to their ownership interests.
AB111,5,2019 (d) Administration. Subsection (4) (e) to (h), as it applies to the credit under
20sub. (4), applies to the credit under this subsection.
AB111, s. 7 21Section 7. 71.30 (3) (epa) of the statutes is created to read:
AB111,5,2222 71.30 (3) (epa) Health care information technology credit under s. 71.28 (5k).
AB111, s. 8 23Section 8. 71.34 (1) (g) of the statutes is amended to read:
AB111,6,224 71.34 (1) (g) An addition shall be made for credits computed by a tax-option
25corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (3), (3g),

1(3n), (3t), (3w), (5b), (5e), (5f), (5g), and (5h), and (5k) and passed through to
2shareholders.
AB111, s. 9 3Section 9. 71.45 (2) (a) 10. of the statutes is amended to read:
AB111,6,94 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
5computed under s. 71.47 (1dd) to (1dx), (3n), (3w), (5b), (5e), (5f), (5g), and (5h), and
6(5k)
and not passed through by a partnership, limited liability company, or
7tax-option corporation that has added that amount to the partnership's, limited
8liability company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1)
9(g) and the amount of credit computed under s. 71.47 (1), (3), (3t), (4), and (5).
AB111, s. 10 10Section 10. 71.47 (5k) of the statutes is created to read:
AB111,6,1211 71.47 (5k) Health care information technology credit. (a) Definition. In this
12subsection, "claimant" means a person who files a claim under this subsection.
AB111,6,1513 (b) Filing claims. Subject to the limitations provided in this subsection, a
14claimant may claim as a credit against the taxes imposed under s. 71.43, up to the
15amount of those taxes, the following:
AB111,6,2116 1. An amount equal to 50 percent of the amount the claimant paid in the taxable
17year for information technology hardware or software that is used to maintain
18medical records in electronic form, if the claimant is a health care provider, as defined
19in s. 146.81 (1), and, in the case of software used as the basis for a credit under this
20subsection, if the software is certified by the Certification Commission for
21Healthcare Information Technology.
AB111,7,222 2. An amount equal to 7.9 percent of the interest received by the claimant on
23obligations issued under s. 231.03 (6), on or after the effective date of this subdivision
24.... [revisor inserts date], if the obligations that are issued are used by a health

1facility, as defined in s. 231.01 (5), to fund the acquisition of information technology
2hardware or software.
AB111,7,53 (c) Limitations. 1. The maximum amount of the credits that may be claimed
4under par. (b) 1. and ss. 71.07 (5k) (b) 1. and 71.28 (5k) (b) 1. in a taxable year is
5$10,000,000, as allocated under s. 560.204.
AB111,7,136 2. Partnerships, limited liability companies, and tax-option corporations may
7not claim the credit under this subsection, but the eligibility for, and the amount of,
8the credit are based on their payment of amounts under par. (b). A partnership,
9limited liability company, or tax-option corporation shall compute the amount of
10credit that each of its partners, members, or shareholders may claim and shall
11provide that information to each of them. Partners, members of limited liability
12companies, and shareholders of tax-option corporations may claim the credit in
13proportion to their ownership interests.
AB111,7,1514 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
15s. 71.28 (4), applies to the credit under this subsection.
AB111, s. 11 16Section 11. 71.49 (1) (epa) of the statutes is created to read:
AB111,7,1717 71.49 (1) (epa) Health care information technology credit under s. 71.47 (5k).
AB111, s. 12 18Section 12. 77.92 (4) of the statutes is amended to read:
AB111,8,819 77.92 (4) "Net business income," with respect to a partnership, means taxable
20income as calculated under section 703 of the Internal Revenue Code; plus the items
21of income and gain under section 702 of the Internal Revenue Code, including taxable
22state and municipal bond interest and excluding nontaxable interest income or
23dividend income from federal government obligations; minus the items of loss and
24deduction under section 702 of the Internal Revenue Code, except items that are not
25deductible under s. 71.21; plus guaranteed payments to partners under section 707

1(c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de),
2(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g), (3s), (3n), (3t), (3w), (5b), (5e), (5f),
3(5g), and (5h), and (5k); and plus or minus, as appropriate, transitional adjustments,
4depreciation differences, and basis differences under s. 71.05 (13), (15), (16), (17), and
5(19); but excluding income, gain, loss, and deductions from farming. "Net business
6income," with respect to a natural person, estate, or trust, means profit from a trade
7or business for federal income tax purposes and includes net income derived as an
8employee as defined in section 3121 (d) (3) of the Internal Revenue Code.
AB111, s. 13 9Section 13. 560.204 of the statutes is created to read:
AB111,8,13 10560.204 Hardware and software used to maintain medical records. (1)
11The department shall implement a program to certify health care providers as
12eligible for the electronic medical records credit under ss. 71.07 (5k) (b) 1., 71.28 (5k)
13(b) 1., and 71.47 (5k) (b) 1.
AB111,8,17 14(2) If the department certifies a health care provider under sub. (1), the
15department shall determine the amount of credits to allocate to the health care
16provider. The total amount of electronic medical records credits allocated to health
17care providers in any year may not exceed $10,000,000.
AB111,8,20 18(3) The department shall inform the department of revenue of every health
19care provider certified under sub. (1) and the amount of credits allocated to the health
20care provider.
AB111,8,22 21(4) The department, in consultation with the department of revenue, shall
22promulgate rules to administer this section.
AB111, s. 14 23Section 14. Initial applicability.
AB111,8,2424 (1) This act first applies to taxable years beginning on January 1, 2008.
AB111,8,2525 (End)
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