SB139,2,1313 3. "Manufacturing" has the meaning given in s. 77.54 (6m).

SB139,3,3

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14. "Nanotechnology" means the science and technology that enables a person
2to understand, measure, manipulate, and manufacture materials at the atomic,
3molecular, and supermolecular levels.

SB139,3,94 5. "Nanotechnology business" means a business, as certified by the department
5of commerce in the manner prescribed by the department of commerce, that is
6primarily engaged in applying nanotechnologies to create new applications or
7processes, or modify existing applications or processes, in order to make useful
8processes and products related to health care, energy, food production,
9manufacturing, biotechnology, information technology, or the environment.

SB139,3,1510 6. "Qualified research" means qualified research as defined under section 41
11(d) (1) of the Internal Revenue Code, except that research conducted by a public or
12private institution of higher education or a consortium, or a combination thereof, is
13"qualified research" if the research is intended to be useful in developing a new or
14improved product or service and the research satisfies section 41 (d) (1) (B) (i) and
15(C) of the Internal Revenue Code.

SB139,3,1716 7. "Used exclusively" means used to the exclusion of all other uses except for
17use not exceeding 5 percent of total use.

SB139,3,2118 (b) Filing claims. Subject to the limitations provided in this subsection and s.
19560.207, for taxable years beginning on or after July 1, 2008, a claimant may claim
20as a credit against the taxes imposed under s. 71.02 or 71.08, up to the amount of the
21taxes, any of the following amounts that the claimant paid in the taxable year:

SB139,4,222 1. The taxes imposed under subch. III of ch. 77 on the purchase of machines and
23processing equipment, including accessories, attachments, and parts for the
24machines or equipment, that are used exclusively and directly by the claimant in the

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1claimant's nanotechnology business for qualified research and manufacturing, if the
2research and manufacturing occurs in this state.

SB139,4,63 2. Payments to a public or private institution of higher education, or to a
4consortium, for research, equipment, or the use of research facilities, or other
5qualified expenses as determined by the department of commerce, that are directly
6related to nanotechnology.

SB139,4,97 3. The taxes imposed under subch. III of ch. 77 on the purchase of any of the
8following that are used by the claimant's nanotechnology business for research and
9development that occurs in this state:

SB139,4,1010 a. Advanced computing devices, including computer hardware and software.

SB139,4,1111 b. Data communications.

SB139,4,1212 c. Information technology.

SB139,4,1413 d. Laboratory materials used exclusively for nanotechnology research and
14development.

SB139,4,1715 (c) Limitations. 1. The maximum amount of the credits that may be allocated
16to all claimants under this subsection and ss. 71.28 (5i) and 71.47 (5i) in each fiscal
17year is $2,500,000, as determined by the department of commerce under s. 560.207.

SB139,4,2018 2. No credit may be allowed under this subsection unless the claimant submits
19with the claimant's return a copy of the claimant's certification for and allocation of
20credits under s. 560.207.

SB139,5,321 3. Partnerships, limited liability companies, and tax-option corporations may
22not claim the credit under this subsection, but the eligibility for, and the amount of,
23the credit are based on their payment of amounts under par. (b). A partnership,
24limited liability company, or tax-option corporation shall compute the amount of
25credit that each of its partners, members, or shareholders may claim and shall

---

1provide that information to each of them. Partners, members of limited liability
2companies, and shareholders of tax-option corporations may claim the credit in
3proportion to their ownership interests.

SB139,5,54 (d) Administration. 1. Section 71.28 (4) (e), (g), and (h), as it applies to the
5credit under s. 71.28 (4), applies to the credit under this subsection.

SB139,5,116 2. If a credit computed under this subsection is not entirely offset against
7Wisconsin income or franchise taxes otherwise due, the unused balance may be
8carried forward and credited against Wisconsin income or franchise taxes otherwise
9due for the following 10 taxable years to the extent not offset by these taxes otherwise
10due in all intervening years between the year in which the expense was incurred and
11the year in which the carry-forward credit is claimed.

SB139,5,2213 71.08 (1) Imposition. (intro.) If the tax imposed on a natural person, married
14couple filing jointly, trust, or estate under s. 71.02, not considering the credits under
15ss. 71.07 (1), (2dd), (2de), (2di), (2dj), (2dL), (2dr), (2ds), (2dx), (2fd), (3c), (3e), (3m),
16(3n), (3s), (3t), (3w), (5b), (5d), (5e), (5f), (5i), (6), (6e), and (9e), 71.28 (1dd), (1de), (1di),
17(1dj), (1dL), (1ds), (1dx), (1fd), (2m), (3), (3n), (3t), and (3w), and 71.47 (1dd), (1de),
18(1di), (1dj), (1dL), (1ds), (1dx), (1fd), (2m), (3), (3n), (3t), and (3w), and subchs. VIII
19and IX and payments to other states under s. 71.07 (7), is less than the tax under this
20section, there is imposed on that natural person, married couple filing jointly, trust
21or estate, instead of the tax under s. 71.02, an alternative minimum tax computed
22as follows:

SB139,5,2424 71.10 (4) (gab) Nanotechnology credit under s. 71.07 (5i).

SB139,6,3

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

SB139,6,225 71.26 (2) (a) Corporations in general. The "net income" of a corporation means
6the gross income as computed under the Internal Revenue Code as modified under
7sub. (3) minus the amount of recapture under s. 71.28 (1di) plus the amount of credit
8computed under s. 71.28 (1), (3), (4), and (5) minus, as provided under s. 71.28 (3) (c)
97., the amount of the credit under s. 71.28 (3) that the taxpayer added to income
10under this paragraph at the time that the taxpayer first claimed the credit plus the
11amount of the credit computed under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm),
12(1ds), (1dx), (3g), (3n), (3t), (3w), (5b), (5e), (5f), (5g), and (5h), and (5i) and not passed
13through by a partnership, limited liability company, or tax-option corporation that
14has added that amount to the partnership's, limited liability company's, or
15tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) plus the amount
16of losses from the sale or other disposition of assets the gain from which would be
17wholly exempt income, as defined in sub. (3) (L), if the assets were sold or otherwise
18disposed of at a gain and minus deductions, as computed under the Internal Revenue
19Code as modified under sub. (3), plus or minus, as appropriate, an amount equal to
20the difference between the federal basis and Wisconsin basis of any asset sold,
21exchanged, abandoned, or otherwise disposed of in a taxable transaction during the
22taxable year, except as provided in par. (b) and s. 71.45 (2) and (5).

SB139,6,2424 71.28 (5i) Nanotechnology credit. (a) Definitions. In this subsection:

SB139,6,2525 1. "Claimant" means a person who files a claim under this subsection.

SB139,7,3

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12. "Consortium" means 2 or more public institutions of higher education that
2are conducting substantially similar qualified research or working on components
3of the same qualified research.

SB139,7,44 3. "Manufacturing" has the meaning given in s. 77.54 (6m).

SB139,7,75 4. "Nanotechnology" means the science and technology that enables a person
6to understand, measure, manipulate, and manufacture materials at the atomic,
7molecular, and supermolecular levels.

SB139,7,138 5. "Nanotechnology business" means a business, as certified by the department
9of commerce in the manner prescribed by the department of commerce, that is
10primarily engaged in applying nanotechnologies to create new applications or
11processes, or modify existing applications or processes, in order to make useful
12processes and products related to health care, energy, food production,
13manufacturing, biotechnology, information technology, or the environment.

SB139,7,1914 6. "Qualified research" means qualified research as defined under section 41
15(d) (1) of the Internal Revenue Code, except that research conducted by a public or
16private institution of higher education or a consortium, or a combination thereof, is
17"qualified research" if the research is intended to be useful in developing a new or
18improved product or service and the research satisfies section 41 (d) (1) (B) (i) and
19(C) of the Internal Revenue Code.

SB139,7,2120 7. "Used exclusively" means used to the exclusion of all other uses except for
21use not exceeding 5 percent of total use.

SB139,7,2522 (b) Filing claims. Subject to the limitations provided in this subsection and s.
23560.207, for taxable years beginning on or after July 1, 2008, a claimant may claim
24as a credit against the taxes imposed under s. 71.23, up to the amount of the taxes,
25any of the following amounts that the claimant paid in the taxable year:

SB139,8,5

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11. The taxes imposed under subch. III of ch. 77 on the purchase of machines and
2processing equipment, including accessories, attachments, and parts for the
3machines or equipment, that are used exclusively and directly by the claimant in the
4claimant's nanotechnology business for qualified research and manufacturing, if the
5research and manufacturing occurs in this state.

SB139,8,96 2. Payments to a public or private institution of higher education, or to a
7consortium, for research, equipment, or the use of research facilities, or other
8qualified expenses as determined by the department of commerce, that are directly
9related to nanotechnology.

SB139,8,1210 3. The taxes imposed under subch. III of ch. 77 on the purchase of any of the
11following that are used by the claimant's nanotechnology business for research and
12development that occurs in this state:

SB139,8,1313 a. Advanced computing devices, including computer hardware and software.

SB139,8,1414 b. Data communications.

SB139,8,1515 c. Information technology.

SB139,8,1716 d. Laboratory materials used exclusively for nanotechnology research and
17development.

SB139,8,2018 (c) Limitations. 1. The maximum amount of the credits that may be allocated
19to all claimants under this subsection and ss. 71.07 (5i) and 71.47 (5i) in each fiscal
20year is $2,500,000, as determined by the department of commerce under s. 560.207.

SB139,8,2321 2. No credit may be allowed under this subsection unless the claimant submits
22with the claimant's return a copy of the claimant's certification for and allocation of
23credits under s. 560.207.

SB139,9,624 3. Partnerships, limited liability companies, and tax-option corporations may
25not claim the credit under this subsection, but the eligibility for, and the amount of,

---

1the credit are based on their payment of amounts under par. (b). A partnership,
2limited liability company, or tax-option corporation shall compute the amount of
3credit that each of its partners, members, or shareholders may claim and shall
4provide that information to each of them. Partners, members of limited liability
5companies, and shareholders of tax-option corporations may claim the credit in
6proportion to their ownership interests.

SB139,9,87 (d) Administration. 1. Subsection (4) (e), (g), and (h), as it applies to the credit
8under sub. (4), applies to the credit under this subsection.

SB139,9,149 2. If a credit computed under this subsection is not entirely offset against
10Wisconsin income or franchise taxes otherwise due, the unused balance may be
11carried forward and credited against Wisconsin income or franchise taxes otherwise
12due for the following 10 taxable years to the extent not offset by these taxes otherwise
13due in all intervening years between the year in which the expense was incurred and
14the year in which the carry-forward credit is claimed.

SB139,9,1616 71.30 (3) (dq) Nanotechnology credit under s. 71.28 (5i).

SB139,9,2118 71.34 (1) (g) An addition shall be made for credits computed by a tax-option
19corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (3), (3g),
20(3n), (3t), (3w), (5b), (5e), (5f), (5g), and (5h) , and (5i) and passed through to
21shareholders.

SB139,9,2523 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
24computed under s. 71.47 (1dd) to (1dx), (3n), (3w), (5b), (5e), (5f), (5g), and (5h), and
25(5i) and not passed through by a partnership, limited liability company, or tax-option

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1corporation that has added that amount to the partnership's, limited liability
2company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) and
3the amount of credit computed under s. 71.47 (1), (3), (3t), (4), and (5).

SB139,10,55 71.47 (5i) Nanotechnology credit. (a) Definitions. In this subsection:

SB139,10,66 1. "Claimant" means a person who files a claim under this subsection.

SB139,10,97 2. "Consortium" means 2 or more public institutions of higher education that
8are conducting substantially similar qualified research or working on components
9of the same qualified research.

SB139,10,1010 3. "Manufacturing" has the meaning given in s. 77.54 (6m).

SB139,10,1311 4. "Nanotechnology" means the science and technology that enables a person
12to understand, measure, manipulate, and manufacture materials at the atomic,
13molecular, and supermolecular levels.

SB139,10,1914 5. "Nanotechnology business" means a business, as certified by the department
15of commerce in the manner prescribed by the department of commerce, that is
16primarily engaged in applying nanotechnologies to create new applications or
17processes, or modify existing applications or processes, in order to make useful
18processes and products related to health care, energy, food production,
19manufacturing, biotechnology, information technology, or the environment.

SB139,10,2520 6. "Qualified research" means qualified research as defined under section 41
21(d) (1) of the Internal Revenue Code, except that research conducted by a public or
22private institution of higher education or a consortium, or a combination thereof, is
23"qualified research" if the research is intended to be useful in developing a new or
24improved product or service and the research satisfies section 41 (d) (1) (B) (i) and
25(C) of the Internal Revenue Code.

SB139,11,2

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17. "Used exclusively" means used to the exclusion of all other uses except for
2use not exceeding 5 percent of total use.

SB139,11,63 (b) Filing claims. Subject to the limitations provided in this subsection and s.
4560.207, for taxable years beginning on or after July 1, 2008, a claimant may claim
5as a credit against the taxes imposed under s. 71.43, up to the amount of the taxes,
6any of the following amounts that the claimant paid in the taxable year:

SB139,11,117 1. The taxes imposed under subch. III of ch. 77 on the purchase of machines and
8processing equipment, including accessories, attachments, and parts for the
9machines or equipment, that are used exclusively and directly by the claimant in the
10claimant's nanotechnology business for qualified research and manufacturing, if the
11research and manufacturing occurs in this state.

SB139,11,1512 2. Payments to a public or private institution of higher education, or to a
13consortium, for research, equipment, or the use of research facilities, or other
14qualified expenses as determined by the department of commerce, that are directly
15related to nanotechnology.

SB139,11,1816 3. The taxes imposed under subch. III of ch. 77 on the purchase of any of the
17following that are used by the claimant's nanotechnology business for research and
18development that occurs in this state:

SB139,11,1919 a. Advanced computing devices, including computer hardware and software.

SB139,11,2020 b. Data communications.

SB139,11,2121 c. Information technology.

SB139,11,2322 d. Laboratory materials used exclusively for nanotechnology research and
23development.

SB139,12,3

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1(c) Limitations. 1. The maximum amount of the credits that may be allocated
2to all claimants under this subsection and ss. 71.07 (5i) and 71.28 (5i) in each fiscal
3year is $2,500,000, as determined by the department of commerce under s. 560.207.

SB139,12,64 2. No credit may be allowed under this subsection unless the claimant submits
5with the claimant's return a copy of the claimant's certification for and allocation of
6credits under s. 560.207.

SB139,12,147 3. Partnerships, limited liability companies, and tax-option corporations may
8not claim the credit under this subsection, but the eligibility for, and the amount of,
9the credit are based on their payment of amounts under par. (b). A partnership,
10limited liability company, or tax-option corporation shall compute the amount of
11credit that each of its partners, members, or shareholders may claim and shall
12provide that information to each of them. Partners, members of limited liability
13companies, and shareholders of tax-option corporations may claim the credit in
14proportion to their ownership interests.

SB139,12,1615 (d) Administration. 1. Section 71.28 (4) (e), (g), and (h), as it applies to the
16credit under s. 71.28 (4), applies to the credit under this subsection.

SB139,12,2217 2. If a credit computed under this subsection is not entirely offset against
18Wisconsin income or franchise taxes otherwise due, the unused balance may be
19carried forward and credited against Wisconsin income or franchise taxes otherwise
20due for the following 10 taxable years to the extent not offset by these taxes otherwise
21due in all intervening years between the year in which the expense was incurred and
22the year in which the carry-forward credit is claimed.

SB139,12,2424 71.49 (1) (dq) Nanotechnology credit under s. 71.47 (5i).

SB139,13,15

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177.92 (4) "Net business income," with respect to a partnership, means taxable
2income as calculated under section 703 of the Internal Revenue Code; plus the items
3of income and gain under section 702 of the Internal Revenue Code, including taxable
4state and municipal bond interest and excluding nontaxable interest income or
5dividend income from federal government obligations; minus the items of loss and
6deduction under section 702 of the Internal Revenue Code, except items that are not
7deductible under s. 71.21; plus guaranteed payments to partners under section 707
8(c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de),
9(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g), (3s), (3n), (3t), (3w), (5b), (5e), (5f),
10(5g), and (5h), and (5i); and plus or minus, as appropriate, transitional adjustments,
11depreciation differences, and basis differences under s. 71.05 (13), (15), (16), (17), and
12(19); but excluding income, gain, loss, and deductions from farming. "Net business
13income," with respect to a natural person, estate, or trust, means profit from a trade
14or business for federal income tax purposes and includes net income derived as an
15employee as defined in section 3121 (d) (3) of the Internal Revenue Code.

SB139,13,19 17560.207 Nanotechnology tax credits. (1) The department shall implement
18a program for certifying businesses as eligible for tax credits under ss. 71.07 (5i),
1971.28 (5i), and 71.47 (5i).

SB139,13,25 20(2) If the department certifies a business as eligible under sub. (1), the
21department shall determine the amount of expenditures by the business that meet
22the requirements of s. 71.07 (5i) (b) 1. to 3., 71.28 (5i) (b) 1. to 3., or 71.47 (5i) (b) 1.
23to 3. and shall determine the amount of tax credits to be allocated to the business.
24The total amount of tax credits allocated to all eligible businesses may not exceed
25$2,500,000 per fiscal year.

SB139,14,3

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1(3) The department of commerce shall notify the department of revenue of
2every business certified under sub. (1) and the amount of tax credits allocated to the
3business under sub. (2).