2009 - 2010 LEGISLATURE
March 29, 2010 - Introduced by Representative Hixson. Referred to Committee on
Ways and Means.
AB909,1,4 1An Act to amend 71.05 (6) (a) 15., 71.21 (4), 71.26 (2) (a) 4., 71.34 (1k) (g), 71.45
2(2) (a) 10. and 77.92 (4); and to create 71.07 (5p), 71.10 (4) (ce), 71.28 (5p), 71.30
3(3) (ce), 71.47 (5p) and 71.49 (1) (ce) of the statutes; relating to: an income and
4franchise tax credit for new small businesses that hire interns.
Analysis by the Legislative Reference Bureau
Under this bill, a new small business may claim an income and franchise tax
credit of $1,000 for hiring an intern. In order for the business to receive the credit,
the intern must be enrolled at a public or private postsecondary institution, work at
least 20 hours per week for one semester, and receive course credit for the internship.
A business may claim the credit only once. Under the bill, a new small business is
a business that employs no more than ten employees in this state and is organized
in this state on a date that is not more than 12 months from the date on which the
intern starts his or her employment.
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:
AB909, s. 1 5Section 1. 71.05 (6) (a) 15. of the statutes, as affected by 2009 Wisconsin Act
628
, is amended to read:
AB909,2,6
171.05 (6) (a) 15. The amount of the credits computed under s. 71.07 (2dd), (2de),
2(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3s),
3(3t), (3w), (5e), (5f), (5h), (5i), (5j), (5k), (5p), and (8r) and not passed through by a
4partnership, limited liability company, or tax-option corporation that has added that
5amount to the partnership's, company's, or tax-option corporation's income under s.
671.21 (4) or 71.34 (1k) (g).
AB909, s. 2 7Section 2. 71.07 (5p) of the statutes is created to read:
AB909,2,98 71.07 (5p) New small business internship credit. (a) Definitions. In this
9subsection:
AB909,2,1210 1. "Business" means any organization or enterprise operated for profit,
11including a proprietorship, partnership, firm, business trust, joint venture,
12syndicate, corporation, limited liability company, or association.
AB909,2,1313 2. "Claimant" means a person who files a claim under this subsection.
AB909,2,1414 3. "Course of instruction" has the meaning given in s. 38.50 (1) (c).
AB909,2,1515 4. "New small business" means a business for which all of the following apply:
AB909,2,1716 a. It employs no more than 10 employees in this state during the taxable year
17for which the claimant claims a credit under this subsection.
AB909,2,2018 b. It is organized in this state on a date that is not more than 12 months from
19the date on which an intern for which a credit is claimed under this subsection begins
20his or her employment with the business.
AB909,2,2121 5. "Qualified postsecondary institution" means all of the following:
AB909,2,2422 a. A University of Wisconsin System institution, a technical college system
23institution, or a regionally accredited 4-year nonprofit college or university having
24its regional headquarters and principal place of business in this state.
AB909,3,2
1b. A school approved under s. 38.50, if the delivery of education occurs in this
2state.
AB909,3,53 (b) Filing claims. Subject to the limitations provided in this subsection, a
4claimant may claim as a credit against the tax imposed under s. 71.02, up to the
5amount of the tax, $1,000, if all of the following apply:
AB909,3,76 1. The claimant's new small business hires an intern during the taxable year
7for which the claimant files a claim under this subsection.
AB909,3,98 2. The intern is enrolled in a course of instruction at a qualified postsecondary
9institution.
AB909,3,1210 3. The intern works for the claimant's new small business at least 20 hours per
11week, on average, during a period that corresponds with at least one semester at the
12intern's qualified postsecondary institution.
AB909,3,1413 4. The intern receives course credit from the qualified postsecondary
14institution for the work done at the claimant's new small business.
AB909,3,1615 (c) Limitations. 1. The maximum amount of the credit that a claimant may
16receive under this subsection is $1,000.
AB909,3,2417 2. 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.
AB909,4,2
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.
AB909, s. 3 3Section 3. 71.10 (4) (ce) of the statutes is created to read:
AB909,4,44 71.10 (4) (ce) New small business internship credit under s. 71.07 (5p).
AB909, s. 4 5Section 4. 71.21 (4) of the statutes, as affected by 2009 Wisconsin Act 28, is
6amended to read:
AB909,4,107 71.21 (4) Credits computed by a partnership under s. 71.07 (2dd), (2de), (2di),
8(2dj), (2dL), (2dm), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3s), (3t), (3w),
9(5e), (5f), (5g), (5h), (5i), (5j), (5k), (5p), and (8r) and passed through to partners shall
10be added to the partnership's income.
AB909, s. 5 11Section 5. 71.26 (2) (a) 4. of the statutes, as affected by 2009 Wisconsin Act 28,
12is amended to read:
AB909,4,1813 71.26 (2) (a) 4. Plus the amount of the credit computed under s. 71.28 (1dd),
14(1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (1dy), (3g), (3h), (3n), (3p), (3q), (3r), (3t),
15(3w), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5p), and (8r) and not passed through by a
16partnership, limited liability company, or tax-option corporation that has added that
17amount to the partnership's, limited liability company's, or tax-option corporation's
18income under s. 71.21 (4) or 71.34 (1k) (g).
AB909, s. 6 19Section 6. 71.28 (5p) of the statutes is created to read:
AB909,4,2120 71.28 (5p) New small business internship credit. (a) Definitions. In this
21subsection:
AB909,4,2422 1. "Business" means any organization or enterprise operated for profit,
23including a proprietorship, partnership, firm, business trust, joint venture,
24syndicate, corporation, limited liability company, or association.
AB909,4,2525 2. "Claimant" means a person who files a claim under this subsection.
AB909,5,1
13. "Course of instruction" has the meaning given in s. 38.50 (1) (c).
AB909,5,22 4. "New small business" means a business for which all of the following apply:
AB909,5,43 a. It employs no more than 10 employees in this state during the taxable year
4for which the claimant claims a credit under this subsection.
AB909,5,75 b. It is organized in this state on a date that is not more than 12 months from
6the date on which an intern for which a credit is claimed under this subsection begins
7his or her employment with the business.
AB909,5,88 5. "Qualified postsecondary institution" means all of the following:
AB909,5,119 a. A University of Wisconsin System institution, a technical college system
10institution, or a regionally accredited 4-year nonprofit college or university having
11its regional headquarters and principal place of business in this state.
AB909,5,1312 b. A school approved under s. 38.50, if the delivery of education occurs in this
13state.
AB909,5,1614 (b) Filing claims. Subject to the limitations provided in this subsection, a
15claimant may claim as a credit against the tax imposed under s. 71.23, up to the
16amount of the tax, $1,000, if all of the following apply:
AB909,5,1817 1. The claimant's new small business hires an intern during the taxable year
18for which the claimant files a claim under this subsection.
AB909,5,2019 2. The intern is enrolled in a course of instruction at a qualified postsecondary
20institution.
AB909,5,2321 3. The intern works for the claimant's new small business at least 20 hours per
22week, on average, during a period that corresponds with at least one semester at the
23intern's qualified postsecondary institution.
AB909,5,2524 4. The intern receives course credit from the qualified postsecondary
25institution for the work done at the claimant's new small business.
AB909,6,2
1(c) Limitations. 1. The maximum amount of the credit that a claimant may
2receive under this subsection is $1,000.
AB909,6,103 2. Partnerships, limited liability companies, and tax-option corporations may
4not claim the credit under this subsection, but the eligibility for, and the amount of,
5the credit are based on their payment of amounts under par. (b). A partnership,
6limited liability company, or tax-option corporation shall compute the amount of
7credit that each of its partners, members, or shareholders may claim and shall
8provide that information to each of them. Partners, members of limited liability
9companies, and shareholders of tax-option corporations may claim the credit in
10proportion to their ownership interests.
AB909,6,1211 (d) Administration. Subsection (4) (e) to (h), as it applies to the credit under
12sub. (4), applies to the credit under this subsection.
AB909, s. 7 13Section 7. 71.30 (3) (ce) of the statutes is created to read:
AB909,6,1414 71.30 (3) (ce) New small business internship credit under s. 71.28 (5p).
AB909, s. 8 15Section 8. 71.34 (1k) (g) of the statutes, as affected by 2009 Wisconsin Act 28,
16is amended to read:
AB909,6,2017 71.34 (1k) (g) An addition shall be made for credits computed by a tax-option
18corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (1dy),
19(3), (3g), (3h), (3n), (3p), (3q), (3r), (3t), (3w), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5p),
20and (8r) and passed through to shareholders.
AB909, s. 9 21Section 9. 71.45 (2) (a) 10. of the statutes, as affected by 2009 Wisconsin Act
2228
, is amended to read:
AB909,7,423 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit
24computed under s. 71.47 (1dd) to (1dy), (3g), (3h), (3n), (3p), (3q), (3r), (3w), (5e), (5f),
25(5g), (5h), (5i), (5j), (5k), (5p), and (8r) and not passed through by a partnership,

1limited liability company, or tax-option corporation that has added that amount to
2the partnership's, limited liability company's, or tax-option corporation's income
3under s. 71.21 (4) or 71.34 (1k) (g) and the amount of credit computed under s. 71.47
4(1), (3), (3t), (4), (4m), and (5).
AB909, s. 10 5Section 10. 71.47 (5p) of the statutes is created to read:
AB909,7,76 71.47 (5p) New small business internship credit. (a) Definitions. In this
7subsection:
AB909,7,108 1. "Business" means any organization or enterprise operated for profit,
9including a proprietorship, partnership, firm, business trust, joint venture,
10syndicate, corporation, limited liability company, or association.
AB909,7,1111 2. "Claimant" means a person who files a claim under this subsection.
AB909,7,1212 3. "Course of instruction" has the meaning given in s. 38.50 (1) (c).
AB909,7,1313 4. "New small business" means a business for which all of the following apply:
AB909,7,1514 a. It employs no more than 10 employees in this state during the taxable year
15for which the claimant claims a credit under this subsection.
AB909,7,1816 b. It is organized in this state on a date that is not more than 12 months from
17the date on which an intern for which a credit is claimed under this subsection begins
18his or her employment with the business.
AB909,7,1919 5. "Qualified postsecondary institution" means all of the following:
AB909,7,2220 a. A University of Wisconsin System institution, a technical college system
21institution, or a regionally accredited 4-year nonprofit college or university having
22its regional headquarters and principal place of business in this state.
AB909,7,2423 b. A school approved under s. 38.50, if the delivery of education occurs in this
24state.
AB909,8,3
1(b) Filing claims. Subject to the limitations provided in this subsection, a
2claimant may claim as a credit against the tax imposed under s. 71.43, up to the
3amount of the tax, $1,000, if all of the following apply:
AB909,8,54 1. The claimant's new small business hires an intern during the taxable year
5for which the claimant files a claim under this subsection.
AB909,8,76 2. The intern is enrolled in a course of instruction at a qualified postsecondary
7institution.
AB909,8,108 3. The intern works for the claimant's new small business at least 20 hours per
9week, on average, during a period that corresponds with at least one semester at the
10intern's qualified postsecondary institution.
AB909,8,1211 4. The intern receives course credit from the qualified postsecondary
12institution for the work done at the claimant's new small business.
AB909,8,1413 (c) Limitations. 1. The maximum amount of the credit that a claimant may
14receive under this subsection is $1,000.
AB909,8,2215 2. Partnerships, limited liability companies, and tax-option corporations may
16not claim the credit under this subsection, but the eligibility for, and the amount of,
17the credit are based on their payment of amounts under par. (b). A partnership,
18limited liability company, or tax-option corporation shall compute the amount of
19credit that each of its partners, members, or shareholders may claim and shall
20provide that information to each of them. Partners, members of limited liability
21companies, and shareholders of tax-option corporations may claim the credit in
22proportion to their ownership interests.
AB909,8,2423 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under
24s. 71.28 (4), applies to the credit under this subsection.
AB909, s. 11 25Section 11. 71.49 (1) (ce) of the statutes is created to read:
AB909,9,1
171.49 (1) (ce) New small business internship credit under s. 71.47 (5p).
AB909, s. 12 2Section 12. 77.92 (4) of the statutes, as affected by 2009 Wisconsin Act 28, is
3amended to read:
AB909,9,194 77.92 (4) "Net business income," with respect to a partnership, means taxable
5income as calculated under section 703 of the Internal Revenue Code; plus the items
6of income and gain under section 702 of the Internal Revenue Code, including taxable
7state and municipal bond interest and excluding nontaxable interest income or
8dividend income from federal government obligations; minus the items of loss and
9deduction under section 702 of the Internal Revenue Code, except items that are not
10deductible under s. 71.21; plus guaranteed payments to partners under section 707
11(c) of the Internal Revenue Code; plus the credits claimed under s. 71.07 (2dd), (2de),
12(2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (2dy), (3g), (3h), (3n), (3p), (3q), (3r), (3s),
13(3t), (3w), (5e), (5f), (5g), (5h), (5i), (5j), (5k), (5p), and (8r); and plus or minus, as
14appropriate, transitional adjustments, depreciation differences, and basis
15differences under s. 71.05 (13), (15), (16), (17), and (19); but excluding income, gain,
16loss, and deductions from farming. "Net business income," with respect to a natural
17person, estate, or trust, means profit from a trade or business for federal income tax
18purposes and includes net income derived as an employee as defined in section 3121
19(d) (3) of the Internal Revenue Code.
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