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2023 - 2024 LEGISLATURE
2023 ASSEMBLY BILL 235
April 28, 2023 - Introduced by Representatives SORTWELL, BEHNKE, EDMING,
GUNDRUM, MAGNAFICI, ROZAR, SAPIK, WICHGERS and ORTIZ-VELEZ, cosponsored
by Senator CABRAL-GUEVARA. Referred to Committee on Ways and Means.
***AUTHORS SUBJECT TO CHANGE***
AN ACT to amend 71.10 (4) (i); and to create 20.835 (2) (fm), 71.07 (9) (cm), 71.07
(11) and 71.54 (2s) of the statutes; relating to: a tax credit for certain property
tax increases and making an appropriation.
Analysis by the Legislative Reference Bureau
This bill creates a refundable individual income tax credit for an increase in the
property taxes that a person who has reached age 65 pays for a primary residence
owned in this state. The credit amount is calculated as the difference between the
property taxes levied on the claimant's primary residence in the year to which the
claim relates and those property taxes in the base year.
Under the bill, the “base year” is the most recent of either of the following years:
1) if a claimant has not moved to a different primary residence after first claiming
the credit, the year immediately before the year in which the claimant first claimed
the credit or 2) if a claimant moves to a different primary residence after first
claiming the credit, the first year for which property taxes are levied on that different
primary residence for the claimant. To claim the credit, the claimant must have paid
the property taxes that are the basis of the calculation. The maximum credit for a
taxable year allowed under the bill is $500.
Because the credit is refundable, if the amount of the claim for which a claimant
is eligible exceeds the claimant's tax liability, the difference will be paid to the
claimant by check.
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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:
SECTION 1. 20.835 (2) (fm) of the statutes is created to read:
20.835 (2) (fm) Elder property tax increase credit. A sum sufficient to pay the
claims approved under s. 71.07 (11).
SECTION 2. 71.07 (9) (cm) of the statutes is created to read:
71.07 (9) (cm) No credit may be allowed under this subsection for an amount
of property taxes claimed as a credit under sub. (11) that relates to the same taxable
year for which a claim is made under this subsection.
SECTION 3. 71.07 (11) of the statutes is created to read:
71.07 (11) ELDER PROPERTY TAX INCREASE CREDIT. (a) Definitions. In this
subsection:
1. “Base year” means the most recent of any of the following years:
a. If the claimant has not moved to a different principal dwelling after first
filing a claim under this subsection, the year immediately preceding the year in
which the claimant first files a claim under this subsection.
b. If a claimant moves to a different principal dwelling after the year in which
the claimant first files a claim under this subsection, the first year for which the
claimant has property taxes levied on that different principal dwelling.
2. “Claimant” means an individual who has reached age 65 by December 31 of
the taxable year to which the claim relates, or an individual and his or her spouse
filing a joint return, either of whom has reached age 65 by December 31 of the taxable
to which the claim relates, and who files a claim under this subsection.
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3. “Household” means an individual and his or her spouse.
4. “Principal dwelling” means a dwelling that is owned and used by the
claimant as a primary dwelling for the entire taxable year for which the credit under
this subsection is claimed and the land surrounding it that is reasonably necessary
for use of the dwelling as a primary dwelling, including a part of a multidwelling or
multipurpose building and a part of the land upon which it is built that is used as
the claimant's primary dwelling.
5. “Property taxes” means the real and personal property taxes, exclusive of
special assessments, delinquent interest, and charges for service, paid by a claimant,
and the claimant's spouse if filing a joint return, levied on the claimant's principal
dwelling in this state less any property taxes levied that are properly includable as
a trade or business expense under section 162 of the Internal Revenue Code. If the
principal dwelling on which the taxes were paid is owned by 2 or more persons or
entities as joint tenants or tenants in common or is owned by spouses as marital
property, “property taxes" is that part of property taxes paid that reflects the
ownership percentage of the claimant, except that this limitation does not apply to
spouses who file a joint return. If the principal dwelling is sold during the taxable
year, the “property taxes" for the seller and buyer shall be the amount of the tax
prorated to each in the closing agreement pertaining to the sale or, if not so provided
for in the closing agreement, the tax shall be prorated between the seller and buyer
in proportion to months of their respective ownership. “Property taxes” includes
monthly municipal permit fees with respect to a principal dwelling imposed under
s. 66.0435 (3) (c).
(b) Filing claims. For taxable years beginning after December 31, 2022, and
subject to the limitations provided in this subsection, a claimant may claim as a
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SECTION 3 ASSEMBLY BILL 235
credit against the tax imposed under s. 71.02 the increase, if any, of the amount of
the property taxes the claimant is levied in the taxable year to which the claim
relates from the property taxes the claimant is levied in the base year. If the
allowable amount of the claim exceeds the income taxes otherwise due on the
claimant's income, the amount of the claim not used as an offset against those taxes
shall be certified by the department of revenue to the department of administration
for payment to the claimant by check, share draft, or other draft from the
appropriation under s. 20.835 (2) (fm).
(c) Limitations. 1. The maximum amount of the credit that a claimant may
claim under this subsection in a taxable year is $500.
2. No credit may be allowed under this subsection if the claimant has not paid
the property taxes on the principal dwelling for the years described in par. (b).
3. a. No credit may be allowed under this subsection if the claimant or the
claimant's spouse files a claim under sub. (6e) that relates to the same taxable year
for which a claim is made under this subsection.
b. No credit may be allowed under this subsection for an amount of property
taxes claimed as a credit under sub. (9) or subch. VIII that relates to the same taxable
year for which a claim is made under this subsection.
4. Except as provided in subd. 6., only one claimant per household per taxable
year may claim a credit under this subsection.
5. No credit may be allowed under this subsection for property taxes that the
claimant pays on his or her principal dwelling that is leased to the claimant.
6. If married persons who are eligible to claim the credit under this subsection
file separate returns, each spouse may claim a credit under this subsection based on
his or her respective ownership interest in the principal dwelling.
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7. No credit may be allowed under this subsection unless it is claimed within
the time period under s. 71.75 (2).
(d) Administration. 1. In administering this subsection, the department of
revenue shall make available suitable forms with instructions for claimants,
including a form that may be included with, or as a part of, the individual income tax
form.
2. Subsection (9e) (d), to the extent that it applies to the credit under that
subsection, applies to the credit under this subsection.
SECTION 4. 71.10 (4) (i) of the statutes is amended to read:
71.10 (4) (i) The total of claim of right credit under s. 71.07 (1), farmland
preservation credit under ss. 71.57 to 71.61, farmland preservation credit, 2010 and
beyond under s. 71.613, homestead credit under subch. VIII, jobs tax credit under s.
71.07 (3q), business development credit under s. 71.07 (3y), research credit under s.
71.07 (4k) (e) 2. a., veterans and surviving spouses property tax credit under s. 71.07
(6e), elder property tax increase credit under s. 71.07 (11), enterprise zone jobs credit
under s. 71.07 (3w), electronics and information technology manufacturing zone
credit under s. 71.07 (3wm), earned income tax credit under s. 71.07 (9e), estimated
tax payments under s. 71.09, and taxes withheld under subch. X.
SECTION 5. 71.54 (2s) of the statutes is created to read:
71.54 (2s) LIMITATION. No credit may be allowed under this subchapter for an
amount of property taxes claimed as a credit under s. 71.07 (11) that relates to the
same taxable year for which a claim is made under this subchapter.
(END)
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