Assembly Bill 532

Income and franchise tax benefit for investment in Wisconsin opportunity zones and providing a penalty. (FE)

Became law

The governor signed it on Mar 4, 2020. It's ⁠.

Introduced, passed

Oct 14, 2019
Committee, passed

Approved
Assembly vote, passed

Passed Feb 18, 2020
Senate vote, passed

Passed 26 to 7
Governor, passed

Signed
Law, here now

2019 Wisconsin Act 136

Latest entry in the official record, Mar 4, 2020: “Published 3-4-2020”

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Wisconsin Act

The number a bill gets when it becomes law, like 2025 Wisconsin Act 12.

Official term: Act. More in the glossary

Legislative Reference Bureau

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Author

A lawmaker who formally puts a bill forward. The text itself is drafted by the Legislative Reference Bureau.

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Signed on in support

Lawmakers who back a bill without being one of its authors, often from the other chamber.

Official term: Cosponsor. More in the glossary

Cost estimate

A state agency's estimate of what a bill would cost or save.

Official term: Fiscal estimate. More in the glossary

Roll call

A vote where each lawmaker's yes or no is recorded by name.

Official term: Roll call vote. More in the glossary

What it does

Summary by the , the Legislature's nonpartisan drafting office. It's their wording, not ours.

This bill allows a taxpayer to decrease the amount of capital gains subject to income and franchise taxation by investing in a Wisconsin opportunity zone.

Currently, under the federal opportunity zone program created in 2017, a taxpayer may defer paying federal income tax on capital gains, and in some cases reduce the amount of tax owed, by investing the gains in an opportunity zone. An opportunity zone is a low-income population census tract designated by the U.S.

Read the full summary

Treasury secretary, with input from a state's governor. Wisconsin has 120 opportunity zones. A taxpayer invests in an opportunity zone by investing in a qualified fund, which must hold at least 90 percent of its assets in opportunity zone property. If the fund's opportunity zone assets fall below the 90 percent threshold, the fund is subject to a fine that is based on the shortfall for each month the threshold is not met. Under the federal program, the taxpayer defers paying tax on the capital gains until the earlier of the date on which the taxpayer sells the investment in the fund or December 31, 2026. At that time, the taxpayer may permanently exclude 10 percent of the deferred gains from income, and thus not pay tax on that amount, if the investment was held for at least five years. The exclusion increases to 15 percent of the gains if the investment was held for at least seven years. Additionally, if the taxpayer holds the investment for at least ten years, the investment's earnings are not taxed. Wisconsin has incorporated the federal provisions into state law and, therefore, the deferral and exclusion treatments apply when calculating state income and franchise taxes.

Under the bill, for income and franchise tax purposes, a taxpayer may exclude an additional 10 percent of the deferred gains if the taxpayer holds the investment in a Wisconsin qualified opportunity fund for at least five years or an additional 15 percent of the deferred gains if the taxpayer holds the investment for at least seven years. A Wisconsin qualified opportunity fund must hold at least 90 percent of its assets in property that qualifies under the federal program and is located in a Wisconsin opportunity zone. If the fund is liable for the federal penalty for failing to meet the 90 percent threshold for opportunity zone assets, the fund must also pay a state civil penalty that is equal to 33 percent of the federal penalty.

Because this bill relates to an exemption from state or local taxes, it may be referred to the Joint Survey Committee on Tax Exemptions for a report to be printed as an appendix to the bill.

Who's behind it

31 lawmakers are its ⁠. 19 are Republicans and 12 are Democrats.

9 more lawmakers ⁠.

See all 40 names

Authors (31)

Scott Allen · Republican, Assembly
Jill Billings · Democrat, Assembly
David Bowen · Democrat, Assembly
Chris Taylor · Democrat, Assembly
James Edming · Republican, Assembly
Jason Fields · Democrat, Assembly
Debra Kolste · Democrat, Assembly
Scott Krug · Republican, Assembly
Bob Kulp · Republican, Assembly
Nick Milroy · Democrat, Assembly
Jeff Mursau · Republican, Assembly
Adam Neylon · Republican, Assembly
Todd Novak · Republican, Assembly
John Nygren · Republican, Assembly
Tod Ohnstad · Democrat, Assembly
Loren Oldenburg · Republican, Assembly
Sondy Pope · Democrat, Assembly
Romaine Quinn · Republican, Senate
Mike Rohrkaste · Republican, Assembly
Ken Skowronski · Republican, Assembly
John Spiros · Republican, Assembly
Mark Spreitzer · Democrat, Senate
Lisa Subeck · Democrat, Assembly
Rob Summerfield · Republican, Assembly
Gary Tauchen · Republican, Assembly
Jeremy Thiesfeldt · Republican, Assembly
Travis Tranel · Republican, Assembly
Ron Tusler · Republican, Assembly
Nancy VanderMeer · Republican, Assembly
Robyn Vining · Democrat, Assembly
Don Vruwink · Democrat, Assembly

Signed on in support (9)

Janet Bewley · Democrat, Senate
Alberta Darling · Republican, Senate
Dan Feyen · Republican, Senate
Dave Hansen · Democrat, Senate
Lena Taylor · Democrat, Senate
Jerry Petrowski · Republican, Senate
Janis Ringhand · Democrat, Senate
Patrick Testin · Republican, Senate
Chuck Wichgers · Republican, Assembly

What it would cost

State agencies filed a . Each opens as a PDF from the Legislature.

Fiscal Estimate From DOR

Versions and amendments

Every text the Legislature printed for this bill, including proposed changes. Each opens on the Legislature's site.