76.638 Early stage seed investment credit.

(1) Definitions. In this section, “fund manager" means an investment fund manager certified under s. 238.15 (2) or s. 560.205 (2), 2009 stats.

(2) Filing claims.

(a) For taxable years beginning after December 31, 2008, subject to the limitations provided under this section and s. 238.15 or s. 560.205, 2009 stats., and except as provided in par. (b), an insurer may claim as a credit against the fees imposed under s. 76.60, 76.63, 76.65, 76.66, or 76.67, 25 percent of the insurer's investment paid to a fund manager that the fund manager invests in a business certified under s. 238.15 or s. 560.205 (1), 2009 stats.

(b) In the case of a partnership, limited liability company, or tax-option corporation, the computation of the 25 percent limitation under par. (a) shall be determined at the entity level rather than the claimant level and may be allocated among the claimants who make investments in the manner set forth in the entity's organizational documents. The entity shall provide to the department of revenue and to the department of commerce or the Wisconsin Economic Development Corporation the names and tax identification numbers of the claimants, the amounts of the credits allocated to the claimants, and the computation of the allocations.

(2m) Limitations. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this section, but the eligibility for, and the amount of, the credit are based on their payment of amounts under sub. (2). A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their ownership interest or as specially allocated in their organizational documents.

(3) Investment basis. The Wisconsin adjusted basis of any investment for which a credit is claimed under sub. (2) shall be reduced by the amount of the credit that is offset against the fees imposed under s. 76.60, 76.63, 76.65, 76.66, or 76.67.

(4) Carry-forward. If the credit under sub. (2) is not entirely offset against the fees under s. 76.60, 76.63, 76.65, 76.66, or 76.67 otherwise due, the unused balance may be carried forward and credited against those fees for the following 15 years to the extent that it is not offset by those fees otherwise due in all the years between the year in which the expense was made and the year in which the carry-forward credit is claimed.

History: 2009 a. 2; 2011 a. 32; 2019 a. 61.