New for 2007
Deduction for Exemptions Line 17 has been redesigned to help prevent errors.
Tuition and Fees Paid Maximum subtraction for tuition and fees paid is increased to $4,843 per student .
New Credits Internet equipment credit (page 24), the enterprise zone jobs credit (page 28), and the dairy manufacturing facility investment credit .
Who Must File
Refer to the table to see if you are required to file a return for 2007.
| Filing status | Age as of December 31,2007 | You must file if your gross income* (or total gross income of husband and wife) during 2007 was: |
| Single | Under 65 . . . . . | $9,490 or more |
| 65 or older . . . . | $9,740 or more | |
| Married-filing joint return | Any age . . . . . . | $18,000 or more |
| Married-filing separate return | Any age . . . . . . | $9,000 or more (applies to each spouse individually must use Form 1) |
| Head of household | Under 65 . . . . . | $12,050 or more |
| 65 or older . . . . | $12,300 or more | |
* Gross income means all income (before deducting expenses) reportable to Wisconsin. The income may be received in the form of money, property, or services. It does not include items that are exempt from Wisconsin tax. For example, it does not include the portion of your social security benefits that is not taxable on your Wisconsin return.
Other Filing Requirements
You may have to file a return even if your income is less than the amounts shown on the table. You must file a return for 2007
- You could be claimed as a dependent on someone else's return and either of the following applies:
- Your gross income was more than $850 and it included at least $301 of unearned income, or
- Your gross income (total unearned income and earned income) was more than
- $8,790 if single,
- $11,350 if head of household,
- $15,830 if married filing jointly, or
- $7,520 if married filing separately.
Unearned income includes taxable interest, dividends, capital gain distributions, and taxable scholarship and fellowship grants that were not reported to you on a W-2. Earned income includes wages, tips, and scholarship and fellowship grants that were reported to you on a W-2.
- You owe a penalty on an IRA, retirement plan, Coverdell education savings account, or Archer medical savings account.
- You were a nonresident or part-year resident of Wisconsin for 2007 and your gross income was $2,000 or more. If you were married, you must file a return if the combined gross income of you and your spouse was $2,000 or more. (You must file Form 1NPR.)
Who Should File
Even if you do not have to file, you should file to get a refund if:
- You had Wisconsin income tax withheld from your wages.
- You paid estimated taxes for 2007.
- You claim the earned income credit or the veterans and surviving spouses property tax credit.
E-Filing (Electronic Filing)
Electronic filing is the fastest way to get your federal and state income tax refunds. If you choose to have your Wisconsin refund deposited directly in a financial institution account, it may be issued in as few as five working days. Checks may be issued in as few as seven working days.
You may pay by electronic funds transfer if you file electronically. File early and schedule payment as late as April 15. Go to www.revenue.wi.gov/faqs/pcs/e-faq3.html for more information.
To file your Wisconsin income tax return electronically, you can use ...
- Wisconsin Free-File Available for free on the Department of Revenue website at www.revenue.wi.gov. These Wisconsin forms are submitted electronically after you complete them.
- A tax professional Check your local telephone directory for the names of tax professionals who offer electronic filing, or visit our website atwww.revenue.wi.gov/eserv/city/index.html.
- Tax preparation software Purchase off-the-shelf tax preparation software to install on your computer, or connect to one of the private vendor websites that offer electronic filing. For more information, visit our website at www.revenue.wi.gov/ eserv/webased.html or www.revenue.wi.gov/eserv/ offshelf.html.
When to File/Extension of Time to File
Your return is due April 15, 2008.
If you cannot file on time, you can get an extension. You may use any federal extension provision for Wisconsin, even if you are filing your federal return by April 15.
How to get an extension You do not need to submit a request for an extension to the department prior to the time you file your Wisconsin return. When you file your Form 1 enclose either:
- a copy of your federal extension application (for example, Form 4868) or
- a statement indicating which federal extension provision you want to apply for Wisconsin (for example, the federal automatic 6-month extension provision).
Note You will owe interest on any tax that you have not paid by April 15, 2008. This applies even though you may have an extension of time to file. If you do not file your return by April 15, 2008, or during an extension period, you are subject to additional interest and penalties. If you expect to owe tax with your return, you can avoid the 1% per month interest charge during the extension period by paying the tax by April 15, 2008. Submit the payment with a 2007 Wisconsin Form 1-ES. You can get this form from our website at www.revenue.wi.gov or at any Department of Revenue office. (Exception You will not be charged interest during an extension period if (1) you served in support of Operation Iraqi Freedom in the United States, or (2) you qualify for a federal extension because of service in a combat zone. See Special Conditions below.)
If you were a farmer or fisher and you did not make estimated tax payments, you must file your return and pay any tax due by March 3, 2008, to avoid paying interest for underpayment of estimated tax. Farmers and fishers are individuals who earn at least two-thirds of their gross income from farming or fishing.
Special Conditions A "Special Conditions" section is located to the right of the Filing Status section on page 1 of Form 1. If you have an extension of time to file due to service in support of Operation Iraqi Freedom in the United States, fill in "01" in the Special Conditions box. If you qualify for an extension because of service in a combat zone, fill in "02" in the box. If you qualify for an extension because of a presidentially-declared disaster, fill in "03" in the box and indicate the specific disaster on the line provided (for example, Hurricane Katrina).
Tax Help or Additional Forms
You can get tax help, forms, or publications at any of the following Department of Revenue offices:
(Note Do not mail your completed return to any of the addresses listed below. Completed returns should be mailed to the address shown on the return.)
Madison -
Customer assistance:
2135 Rimrock Rd.
Mail Stop 5-77
PO Box 8949
(zip code 53708-8949)
phone: (608) 266-2772
e-mail: income@revenue.wi.govForms requests:
Mail Stop 5-77
PO Box 8949
(zip code 53708-8949)
phone: (608) 266-1961
website: www.revenue.wi.gov
Milwaukee -
State Office Bldg., 819 N. 6th St., Rm. 408
(zip code 53203-1682)
income tax information (414) 227-4000
forms requests (414) 227-4000
Appleton -
265 W. Northland Ave.
(zip code 54911-2091)
phone: (920) 832-2727
Eau Claire -
State Office Bldg., 718 W. Clairemont Ave.
(zip code 54701-6190)
phone: (715) 836-2811
Other offices open on a limited schedule (generally Mondays) are: Baraboo, Beaver Dam, Elkhorn, Fond du Lac, Grafton, Green Bay, Hayward, Hudson, Janesville, Kenosha, LaCrosse, Lancaster, Marinette, Oshkosh, Rhinelander, Sheboygan, Superior, Waukesha, Wausau, and Wisconsin Rapids.
Internet Address You can access the department's website 24 hours a day, seven days a week, at www.revenue.wi.gov. From this website, you can:
- Complete electronic forms and submit them for free
- Download forms, schedules, instructions, and publications
- View answers to frequently asked questions
- E-mail us comments or request help
- File your return electronically
TTY Equipment Telephone help is available using TTY equipment. Call (608) 267-1049 in Madison or (414) 227-4147 in Milwaukee. These numbers are to be used only when calling with TTY equipment.
Informational Publications Available
Following is a list of some of the department publications. These publications give detailed information on specific areas of Wisconsin tax law. You can get these publications from any department office or from our Internet website.
Number and Title
102 Wisconsin Tax Treatment of Tax-Option (S) Corporations and Their Shareholders
103 Reporting Capital Gains and Losses for Wisconsin
104 Wisconsin Taxation of Military Personnel
106 Wisconsin Tax Information for Retirees
109 Tax Information for Married Persons Filing Separate Returns and Persons Divorced in 2007
111 How to Get a Private Letter Ruling From the Wisconsin Department of Revenue
113 Federal and Wisconsin Income Tax Reporting Under the Marital Property Act
114 Wisconsin Taxpayer Bill of Rights
117 Guide to Wisconsin Information Returns
120 Net Operating Losses for Individuals, Estates, and Trusts
121 Reciprocity
122 Tax Information for Part-Year Residents and Nonresidents
125 Credit for Tax Paid to Another State
126 How Your Retirement Benefits Are Taxed
205 Do You Owe Wisconsin Use Tax?
400 Wisconsin's Recycling Surcharge
405 Wisconsin Taxation of Native Americans
503 Wisconsin Farmland Preservation Credit
600 Wisconsin Taxation of Lottery Winnings
601 Wisconsin Taxation of Pari-Mutuel Wager Winnings
Questions About Refunds
Call: (608) 266-8100 in Madison or
(414) 227-4907 in Milwaukee or
1-866-WIS-RFND (1-866-947-7363) toll-free within the U.S. or Canada
Visit our Website at: www.revenue.wi.gov.
If you need to contact us about your refund, please wait at least 10 weeks after filing your Form 1. Refund information may not be available until that time.
You may call one of the numbers indicated above or write to: Department of Revenue, Mail Stop 5-77, PO Box 8949, Madison WI 53708-8949. If you call, you will need your social security number and the dollar amount of your refund.
An automated response is available 24 hours a day, 7 days a week, when you call one of the numbers listed above. If you need to speak with a person, assistance is available Monday through Friday from 7:45 a.m. to 4:15 p.m. by calling (608) 266-2772 in Madison or (414) 227-4000 in Milwaukee (long-distance charges, if applicable, will apply).
You may also get information on your refund using our secure Internet website at www.revenue.wi.gov.
Nine Steps To Filing Your Return
|
Before completing Form 1, first fill in your federal return and its supporting attachments. If you are not required to file a federal return, list the sources and amounts of your income and deductions on a separate sheet and include it with your Form 1.
Follow these instructions to complete Form 1. Prepare one copy for your records and another to be filed with the department.
Note. Use black ink to complete the copy of Form 1 that you submit to the department. Do not use pencil or red ink.
Period Covered. File your 2007 return for calendar year 2007 and fiscal years that begin in 2007. For a fiscal year, a 52-53 week period, or a short-period return, fill in the taxable year beginning and ending dates in the taxable year space at the top of the form. If your return is for a fiscal year, a 52-53 week period, or a short-period, also fill in "11" in the Special Conditions box located to the right of the Filing Status section on page 1 of Form 1.
Social Security Number. Fill in your social security number. You must also fill in your spouse's social security number if you are married filing a joint return or married filing a separate return.
Name and Address. Print or type your legal name and address. If you are married filing a joint return, fill in your spouse's legal name (even if your spouse did not have any income). If you filed a joint return for 2006 and you are filing a joint return for 2007 with the same spouse, be sure to enter your names and social security numbers in the same order as on your 2006 return.
Filing Status. Check the appropriate space to indicate your filing status. More than one filing status may apply to you. If it does, choose the one that will give you the lowest tax.
Note. If you became divorced during 2007 or are married and will file a separate return (including a married person filing as head of household), you should get Publication 109, Tax Information for Married Persons Filing Separate Returns and Persons Divorced in 2007, for information on what income you must report.
Single. You may check "single" if any of the following was true on December 31, 2007:
- You were never married.
- You were legally separated under a final decree of divorce or separate maintenance.
- You were widowed before January 1, 2007, and did not remarry in 2007.
Married filing joint return. Most married couples will pay less tax if they file a joint return. You may check "married filing joint return" if any of the following is true:
- You were married as of December 31, 2007.
- Your spouse died in 2007 and you did not remarry in 2007.
- You were married at the end of 2007, and your spouse died in 2008 before filing a 2007 return.
A husband and wife may file a joint return even if only one had income or if they did not live together all year. However, both spouses must sign the return. If you file a joint return, you may not, after the due date for filing that return, amend it to file as married filing separately. A joint return cannot be filed if you and your spouse have different tax years.
If you file a joint return, both you and your spouse are responsible for any tax due on the return. This means that if one spouse does not pay the tax due, the other may have to.
Married filing separate return. If you file separate returns, you will usually pay more state tax than if you file a joint return. Your tax may be higher on separate returns because:
- You cannot take the married couple credit.
- If you lived with your spouse at any time in 2007, a greater amount of any unemployment compensation or social security benefits that you received may be taxable.
- You will not qualify for the disability income exclusion.
- You will not qualify for the earned income credit.
Head of household. If you qualify to file your federal return as head of household, you may also file as head of household for Wisconsin. Unmarried individuals who paid over half the cost of keeping up a home for a qualifying person (such as a child) can use this filing status. Certain married persons who lived apart from their spouse for the last 6 months of 2007 who paid over half the cost of keeping up a home that was the main home of their child, stepchild, or foster child for more than half of 2007 may be able to use this status.
Note. If you are married and qualify to file as head of household, be sure to check both "head of household" filing status and "married" on the same line next to the arrow.
If you do not have to file a federal return, contact any Department of Revenue office to see if you qualify. If you file your federal return as a qualifying widow(er), you may file your Wisconsin return as head of household.
State Election Campaign Fund. You may designate $1 to this fund. If you are married, your spouse may also designate $1 to this fund. Designating an amount will neither change your tax nor reduce your refund.
Tax District. Check either city, village, or town and fill in the name of the Wisconsin city, village, or town in which you lived on December 31, 2007. Also fill in the name of the county in which you lived.
School District Number. See the list of school district numbers on page 33. Fill in the number of the school district in which you lived on December 31, 2007.
Special Conditions. Certain persons have to enter information in the Special Conditions section. See Special Conditions under When to File/Extension of Time to File on page 6, Period Covered on this page, Death of a Taxpayer on page 32, and the instructions for enclosing a divorce decree and injured spouse form on page 30 for information on when to complete this section. If more than one special condition applies, fill in "99" in the Special Conditions box.
Rounding Off to Whole Dollars. The form has preprinted zeros in the place used to enter cents. All amounts filled in the form should be rounded to the nearest dollar. Drop amounts under 50¢ and increase amounts from 50¢ to 99¢ to the next whole dollar. For example, $129.39 becomes $129 and $236.50 becomes $237.
Round off all amounts. But if you have to add two or more amounts to figure the amount to fill in on a line, include cents when adding and only round off the total. If completing the form by hand, DO NOT USE COMMAS when filling in amounts.
Line 1 Federal Adjusted Gross Income
Fill in your federal adjusted gross income from:
- line 37 of your federal Form 1040,
- line 21 of federal Form 1040A, or
- line 4 of federal Form 1040EZ.
Exception. The federal adjusted gross income that you must fill in on line 1 may not be the same as the amount reported as adjusted gross income on your federal Form 1040. Differences may occur because Wisconsin generally uses the provisions of federal law as amended to December 31, 2006. Federal laws enacted after December 31, 2006, may not be used for Wisconsin.
A comprehensive list of the provisions of federal law that may not be used for Wisconsin purposes for 2007 can be found in the instructions for Wisconsin Schedule I. The following is a partial list of the items that may affect the largest number of taxpayers.
- Educator expenses.
- Tuition and fees deduction.
- Increase in sec. 179 expensing.
- Deduction for health savings accounts and related provisions.
- Exclusion for 50% of the gain from the sale or exchange of qualified small business stock.
If any provision of federal law which does not apply for Wisconsin purposes affects your federal adjusted gross income, you must complete Wisconsin Schedule I and enclose it with your Form 1. The amount you fill in on line 1 of Form 1 (and amounts filled in on Schedule 1 on page 4 of Form 1) should be the revised amount determined on Schedule I. See page 6 for how to get Schedule I.
If Schedule I adjustments in a prior year affect income or expense items in 2007 (e.g., the special 30% or 50% bonus depreciation could not be claimed for Wisconsin purposes), you must also make adjustments on Schedule I for 2007.
You may also be required to complete Schedule I if you sold assets during 2007, and the gain or loss from the sale is different for Wisconsin and federal purposes due to Schedule I adjustments made in a prior year. This would occur, for example, if different rates of depreciation were allowed for Wisconsin and federal purposes. See the instructions for Schedule I for more information.
Line 2 State and Municipal Interest
Fill in the amount of interest you received from state and municipal bonds. This will generally be the amount shown on line 8b of your federal Form 1040 or 1040A or the amount identified as tax-exempt interest on line 2 of Form 1040EZ. (If you were required for federal purposes to allocate expenses to this income, reduce the amount to be filled in by such expenses.)
Exception If you received interest income which is exempt for state and federal tax purposes, do not include this interest income on line 2. Interest income which is exempt for federal and Wisconsin tax purposes includes interest from:
- public housing authority or community development authority bonds issued by municipalities located in Wisconsin,
- Wisconsin Housing Finance Authority bonds,
- Wisconsin municipal redevelopment authority bonds,
- Wisconsin higher education bonds,
- Wisconsin Housing and Economic Development Authority bonds issued on or after December 11, 2003, to fund multifamily affordable housing or elderly housing projects,
- Wisconsin Housing and Economic Development Authority bonds issued before January 29, 1987, except business development revenue bonds, economic development revenue bonds, and CHAP housing revenue bonds,
- public housing agency bonds issued before January 29, 1987, by agencies located outside Wisconsin where the interest therefrom qualifies for exemption from federal taxation for a reason other than or in addition to section 103 of the IRC,
- local exposition district bonds,
- Wisconsin professional baseball park district bonds,
- bonds issued by the Government of Puerto Rico, Guam, the Virgin Islands or, for bonds issued after October 16, 2004, the Government of American Samoa,
- local cultural arts district bonds,
- Wisconsin professional football stadium bonds, and
- Wisconsin Aerospace Authority bonds.
Interest from these sources is exempt from Wisconsin income tax whether received by a direct owner of these securities or by a shareholder in a mutual fund which invests in these securities.
Line 3 Capital Gain / Loss Addition
If your federal adjusted gross income includes capital gains and/or losses (see line 13, Form 1040), you must complete Schedule WD.
Schedule WD determines whether any capital gain/loss addition must be reported on line 3. For example, after completing Schedule WD, you may be required to include an amount as an addition to income on line 3 because Wisconsin law limits the deduction for a net capital loss to $500.
Note. If the only amount reported on line 13 of Form 1040 (line 10 of Form 1040A) is a capital gain distribution from a mutual fund or real estate investment trust and you have no Wisconsin capital loss carryover, do not complete line 3. See line 10 instructions.
Line 4 Other Additions
Fill in the code number and amount of any of the additions described below that apply to you. The code number is printed to the left of the various additions. For example, if you are making an addition for a federal net operating loss carryover, you would fill in the numbers 02 in the code number box, and fill in the amount of your federal net operating loss carryover on the line next to the code number box. Also, fill in the total of all your additions on line 4.
Note. SeeAdditions To or Subtractions From Income on page 18 for information on other items which may have to be included on line 4.
01 Farm Losses. An addition may be required if farm losses were deducted on your federal tax return and you were not actively engaged in the farming operations that produced those losses.
To be "actively engaged in farming" with respect to a farming operation, you must make a significant contribution of (1) capital, equipment, or land, or a combination of capital, equipment, or land; and (2) active personal labor or active personal management, or a combination of both.
Factors you must take into consideration in determining if you contribute a significant amount of active personal labor or active personal management include:
- The type of crops and livestock produced;
- The normal and customary farming practices of the area; and
- The total amount of labor and management which is necessary for such a farming operation in the area.
In order to be considered to be actively engaged in a farming operation, you must have (1) a share of the profits or losses from the farming operation which is commensurate with your contributions to the operation, and (2) contributions to the farming operation which are at risk.
Your combined net losses from farming operations in which you are not actively engaged in farming are limited if your nonfarm Wisconsin adjusted gross income is more than $55,000 ($27,500 if married filing separately).
To figure your combined net losses from farming operations, add together any losses you have from farming operations in which you were not actively engaged (for example, these could be losses from a farm partnership or tax-option (S) corporation). Do not reduce these losses by any net farm gains. If the total of these losses is more than the maximum allowable loss shown in the tables below, include the excess on line 4.
Example. A single taxpayer reports a loss of $25,000 on Schedule E from a farm partnership (the taxpayer is not actively engaged in this farming operation), and a profit of $5,000 from the rental of farmland. The taxpayer's nonfarm Wisconsin adjusted gross income is $60,000. Therefore, only $20,000 of the $25,000 farm loss may be deducted. The taxpayer must fill in code 01 and $5,000 in the space provided on line 4.
Farm Loss Limits Single persons and married persons filing joint return |
||
Nonfarm Wisconsin Adjusted Gross Income |
||
| More Than | But Not More Than | Maximum Allowable Loss |
$0 |
$55,000 |
Full Amount |
55,000 |
75,000 |
$20,000 |
75,000 |
100,000 |
17,500 |
100,000 |
150,000 |
15,000 |
150,000 |
200,000 |
15,500 |
200,000 |
250,000 |
10,000 |
250,000 |
300,000 |
7,500 |
300,000 |
600,000 |
5,000 |
600,000 |
No Loss |
|
Farm Loss Limits Married persons filing separate returns (including married filing as head of household) |
||
Nonfarm Wisconsin Adjusted Gross Income |
||
| More Than | But Not More Than | Maximum Allowable Loss |
$0 |
$27,500 |
Full Amount |
27,500 |
37,500 |
$10,000 |
37,500 |
50,000 |
8,750 |
50,000 |
75,000 |
7,500 |
75,000 |
100,000 |
6,250 |
100,000 |
125,000 |
5,000 |
125,000 |
150,000 |
3,750 |
150,000 |
300,000 |
2,500 |
300,000 |
No Loss |
|
02 Federal Net Operating Loss Carryover. Fill in any amount deducted as a federal net operating loss carryover. (See the instructions for line 11, Item 10, for information about the Wisconsin net operating loss carryforward.)
03 Income (Lump-Sum Distributions) Reported on Federal Form 4972. Income from a lump-sum distribution is taxable to Wisconsin. If you reported a lump-sum distribution on federal Form 4972, you must also include the distribution in Wisconsin income. Fill in the total of (1) the capital gain part of the lump-sum distribution from line 6 of Form 4972 and (2) the taxable amount from line 10 of Form 4972. You may reduce this amount by any federal estate tax on line 18 of Form 4972.
CAUTION If the amount on line 10 of Form 4972 was computed using the rules for multiple recipients of a lump-sum distribution, include only your share of the taxable amount on line 10 less your share of any federal estate tax attributable to the lump-sum distribution on line 18.
Note. No portion of a lump-sum distribution may be reported as a capital gain on Wisconsin Schedule WD.
04 Farmland Preservation Credit and Farmland Tax Relief Credit The total amount of farmland preservation credit and farmland tax relief credit you received during 2007 must be reported as income. Fill in as an addition any portion of your farmland preservation credit and farmland tax relief credit which was not included as income on your federal tax return.
05 Development Zones Credit and Technology Zone Credit. Fill in the amount of your development zones credit from Wisconsin Schedule DC and your technology zone credit from Schedule TC. The amount of your credit is income and must be reported on your Wisconsin Form 1, even if you cannot take the full credit this year and must carry part of it forward. (Note Development zones credit and technology zone credit that you receive from a partnership or tax-option (S) corporation will be accounted for when you make the adjustment described in Items 51 and 52 on page 18.)
06 Excess Distribution From a Passive Foreign Investment. Company Fill in the excess distribution from a passive foreign investment company that was not included in federal adjusted gross income (see federal Form 8621).
07 Enterprise Zone Jobs Credit. Fill in the amount of your enterprise zone jobs credit you computed for 2007. The amount of your credit is income and must be reported on Form 1. (Note Enterprise zone jobs credit that you receive from a partnership or a tax-option (S) corporation will be accounted for when you make the adjustment described in Items 51 and 52 on page 18.)
08 Dairy and Livestock Farm Investment Credit. Fill in the amount of dairy and livestock farm investment credit you computed for 2007. The amount of your credit is income and must be reported on Form 1, even if you cannot take the full credit this year and must carry part of it forward. (Note Dairy and livestock farm investment credit that you receive from a partnership or a tax-option (S) corporation will be accounted for when you make the adjustment described in Items 51 and 52 on page 18.)
09 Dairy Manufacturing Facility Investment Credit. Fill in the amount of dairy manufacturing facility investment credit you computed for 2007. The amount of your credit is income and must be reported on Form 1. (Note Dairy manufacturing facility investment credit that you receive from a partnership or a tax-option (S) corporation will be accounted for when you make the adjustment described in Items 51 and 52 on page 18.)
10 Internet Equipment Credit. Fill in the amount of your Internet equipment credit you computed for 2007. The amount of your credit is income and must be reported on Form 1, even if you cannot take the full credit this year and must carry part of it forward. (Note Internet equipment credit that you receive from a partnership or a tax-option (S) corporation will be accounted for when you make the adjustment described in Items 51 and 52 on page 18.)
Line 6 State Income Tax Refund
Refunds of state and local income taxes are not taxable for Wisconsin. Fill in on line 6 the amount from federal Form 1040, line 10.
Line 7 United States Government Interest
Fill in the amount of interest on U.S. bonds and interest and dividends of certain U.S. government corporations that is included on line 1 of Form 1. This income is not taxable for Wisconsin.
A mutual fund may invest in U.S. government securities. If it does, a portion or all of its ordinary dividend may not be taxable by Wisconsin. If a mutual fund advised you that all or a portion of its ordinary dividend is from investments in U.S. government securities, you may include that portion on line 7.
CAUTION Do not fill in on line 7, interest from Ginnie Mae (Government National Mortgage Association) securities and other similar securities which are "guaranteed" by the United States government. You must include interest from these securities in your Wisconsin taxable income.
Line 8 Unemployment Compensation
You may have a different amount of unemployment compensation taxable for Wisconsin and federal purposes. Complete the worksheet in the next column to see if you can subtract any portion of the unemployment compensation which you included as income on your federal tax return.
Line 9 Social Security Adjustment
If you had social security benefits that were taxable on your federal return, refer to your federal Social Security Benefits Worksheet. This worksheet is in the Form 1040 or Form 1040A instructions. Is line 7 of your worksheet more than $34,000 ($44,000 if you are married filing a joint return or $0 if married filing a separate return and you lived with your spouse at any time during 2007)? If NO, leave line 9 of Form 1 blank. If YES, you should fill in the worksheet at right. You can use this worksheet to figure the difference between the amount of social security benefits that are taxable on your federal and Wisconsin returns.
Note The Wisconsin Social Security Benefits Worksheet refers to lines on the federal Social Security Benefits Worksheet that is in the federal Forms 1040 and 1040Ainstructions.You may have used one of the other federal worksheets (for example, the worksheet for social security recipients who contribute to an IRA). If so, use the equivalent lines on that worksheet. If you got a lump-sum payment of benefits for prior years, you may have figured the federal taxable social security separately for each year. In this case, contact any department office for information on how to figure the amount that is not taxable for Wisconsin.
|
||||||||||||||
Line 10 Capital Gain / Loss Subtraction
If your federal adjusted gross income includes capital gains and/or losses (see line 13, Form 1040 or line 10, Form 1040A), you must complete Schedule WD. You must also complete Schedule WD if your federal adjusted gross income does not include capital gains and/or losses, but you have a capital loss carryover for Wisconsin tax purposes.
Schedule WD determines whether any capital gain/loss subtraction must be reported on line 10. For example, after completing Schedule WD, you may be able to include an amount as a subtraction from income on line 10 because you qualify for the Wisconsin 60% capital gain exclusion.
All amounts must be filled in on line 10 as positive numbers.
EXCEPTION. If the only amount reported on line 13 of your federal Form 1040 or line 10 of Form 1040A is a capital gain distribution from a mutual fund or real estate investment trust and you have no Wisconsin capital loss carryover, you may claim a capital gain exclusion on line 10. Fill in 60% of the amount of the capital gain distribution on line 10. Do not complete Wisconsin Schedule WD.
Line 11 Other Subtractions
Fill in the code number and amount of any of the subtractions described below that apply to you. The code number is printed to the left of the various subtractions. For example, if you are claiming a subtraction for tuition expenses, you would fill in the numbers 03 in the code number box, and fill in the amount of your subtraction for tuition expenses on the line next to the code number box. Also, fill in the total of all your subtractions on line 11.
Note. SeeAdditions To or Subtractions From Income on page 18 for information on other items which may have to be included on line 11.
01 Medical Care Insurance You may be able to subtract all or a portion of the cost of your medical care insurance if:
- You were self-employed, or
- You were an employee whose employer did not contribute toward the cost of your medical care insurance, or
- You had no employer and were not self-employed.
"Medical care insurance" means a medical care insurance policy that covers you, your spouse, and dependents and provides surgical, medical, hospital, major medical, or other health service coverage. It does not include premiums for:
Long-term care insurance,
- Life insurance policies,
- Policies providing payment for loss of earnings,
- Policies for loss of life, limb, sight, etc.,
- Policies that pay you a guaranteed amount each week for a stated number of weeks if you are hospitalized for sickness or injury, or
- The part of your car insurance premiums that provides medical insurance coverage for all persons injured in or by your car.
If you participate in your employer's fringe benefit cafeteria plan and agree to a voluntary salary reduction in return for a medical care insurance benefit, you may not consider the amount of your salary reduction an amount you paid for medical care insurance. In this situation, your employer is considered to have paid for your medical care insurance. Such programs may be known as, for example, flexible spending accounts, employee reimbursement accounts, etc.
If you are self-employed, complete Worksheet 1. (Note If you are self-employed and deducted 100% of your medical care insurance cost on line 29 of your federal Form 1040 as a self-employed health insurance deduction, do not complete Worksheet 1 or 2. No additional deduction is allowed.)
|
||||||||||||||||||
If you (1) are an employee whose employer did not contribute toward the cost of your medical care insurance or (2) you had no employer and were not self-employed, complete Worksheet 2 at the top of page 13.
Note. If you were employed for only part of the year or worked part-time, you may have to prorate the medical care insurance deduction on the basis of number of weeks worked during the year to total weeks (52) in the year. Any time you work one or more days during a week, you will be considered to have worked one week.
Example. You were retired for all of 2007. However, you had a part-time job and worked one day per month during the year. Therefore, you are considered to have worked 12 weeks during the year. Your employer did not pay any portion of your health insurance. You paid $8,000 for health insurance during the year. You may claim $1,840 as an amount paid for medical care insurance while you were an employee whose employer did not contribute toward the cost of your insurance computed as follows:
12 (weeks worked) /52 (weeks in a year) = .23 x $8,000 = $1,840
You should fill in $1,840 on line 3 of Worksheet 2. The balance of $6,160 ($8,000 - $1,840) should be filled in on line 1 of Worksheet 2 as the amount paid during a period in which you had no employer and were not self-employed.
|
||||||||||||||||
02 Long-Term Care Insurance. If you paid long-term care insurance costs during 2007, you may be able to subtract all or a portion of the cost of a long-term care insurance policy which covers you or your spouse.
"Long-term care insurance policy" means a disability insurance policy or certificate advertised, marketed, offered, or designed primarily to provide coverage for care that is provided in your home or in an institutional or community-based setting. The care must be convalescent or custodial care or care for a chronic condition or terminal illness.
"Long-term care insurance policy" does not include a medicare supplement policy or medicare replacement policy or a continuing care contract. "Continuing care contract" means a contract which provides nursing services, medical services, or personal care services, in addition to food, shelter, and laundry services, for the duration of a person's life or for a term in excess of one year, conditioned upon any of the following payments:
- An entrance fee in excess of $10,000.
- Providing for the transfer of at least $10,000 (if the amount is expressed in dollars) or 50% of the person's estate (if the amount is expressed as a percentage of the person's estate) to the service provider upon the person's death.
If you paid long-term care insurance costs during 2007 for a policy which covers you or your spouse, complete the worksheet at the bottom of the next column to determine your subtraction.
03 Tuition and Fee Expenses. You may be able to claim a subtraction for up to $4,843 (per student) of the amount you paid during 2007 for tuition and mandatory student fees for you, your spouse (if married filing a joint return), and children whom you claim as dependents on your federal income tax return.
CAUTION If you claimed the tuition and fees deduction on your federal return, be sure you have completed Wisconsin Schedule I.
The tuition and mandatory student fees must have been paid during 2007 to attend any of the following:
- Classes in Wisconsin at a school which qualifies as a university, college, or technical college. A "university, college, or technical college" is any school which has a curriculum leading to a diploma, degree, or occupational or vocational objective.
- Classes in Wisconsin at other post-secondary (post-high school) schools that have been approved by the Wisconsin Educational Approval Board.
- Classes in Minnesota at a public vocational school or public institution of higher education in Minnesota under the MinnesotaWisconsin tuition reciprocity agreement.
- Classes outside Wisconsin provided the tuition is paid to a university, college, or technical college located in Wisconsin.
The subtraction does not apply to tuition or fees paid to preschools or elementary or secondary schools (for example, grade schools and high schools).
Tuition and mandatory student fees paid to a school which fits into one of the four categories listed above may be subtracted regardless of the type of course taken. For example, tuition paid for craft or recreational courses at a technical college qualifies for the subtraction.
|
||||||||||||||||||
Tuition and mandatory student fees paid to a school which does not fit into any of the four categories listed on page 13 may not be claimed as a subtraction. For example, the subtraction does not apply to a fee paid to a retail craft store to attend a session on flower arranging.
Tuition and mandatory student fees paid for correspondence courses or courses received via the Internet or other electronic transmission qualifies for the subtraction as long as the courses are taken in Wisconsin and are presented by a school (located in or outside Wisconsin) which qualifies as a university, college, or technical college, or a school approved by the Wisconsin Educational Approval Board.
CAUTION The subtraction only applies to tuition and mandatory student fees. Amounts paid as separate charges for other items such as room and board, athletic tickets, or other costs may not be subtracted.
You cannot claim a subtraction for tuition and fees paid with certain tax-free funds. For example, you cannot claim a subtraction for tuition paid with tax-free scholarships or Pell grants or for amounts paid or reimbursed to you by your employer. You can subtract tuition and fees paid from loans, gifts, inheritances, and personal savings.
You cannot claim the subtraction if the source of the payment is an amount withdrawn from a Wisconsin state-sponsored college savings program or college tuition and expenses program (for example, EdVest or "tomorrow's scholar"). This limitation applies only if the owner of the account previously claimed a subtraction for contributions to these programs.
The subtraction is limited if your federal adjusted gross income exceeds certain amounts. Your federal adjusted gross income is the amount on line 1 of Form 1.
Determine your tuition and mandatory student fees subtraction as follows:
Single or Head of Household
- If line 1 of Form 1 is $50,000 or less, you may subtract the amount paid for tuition and mandatory student fees during 2007, but not more than $4,843 per student.* Fill in the amount of your subtraction on line 11.
- If line 1 of Form 1 is more than $50,000 but less than $60,000, use the worksheet in the next column to figure the amount of your subtraction.
- If line 1 of Form 1 is $60,000 or more, you may not subtract any amount for tuition and fee expenses.
Married Filing Joint Return
- If line 1 of Form 1 is $80,000 or less, you may subtract the amount paid for tuition and mandatory student fees during 2007, but not more than $4,843 per student.* Fill in the amount of your subtraction on line 11.
- If line 1 of Form 1 is more than $80,000 but less than $100,000, use the worksheet in the next column to figure the amount of your subtraction.
- If line 1 of Form 1 is $100,000 or more, you may not subtract any amount for tuition and fee expenses.
Married Filing Separate Return
- If line 1 of Form 1 is $40,000 or less, you may subtract the amount paid for tuition and mandatory student fees during 2007, but not more than $4,843 per student.* Fill in the amount of your subtraction on line 11.
- If line 1 of Form 1 is more than $40,000 but less than $50,000, use the worksheet below to figure the amount of your subtraction.
- If line 1 of Form 1 is $50,000 or more, you may not subtract any amount for tuition and fee expenses.
Tuition Expense Worksheet CAUTION Only certain taxpayers are required to complete this worksheet. See the instructions for your filing status. |
||||||||||||||
|
* Your subtraction also cannot be more than your total taxable wages, salary, tips, unearned income, (for example, interest, dividends, capital gains, pensions) and net earnings from a trade or business taxable by Wisconsin.
04 Military and Uniformed Services Retirement Benefits. You may subtract retirement payments received from:
- The U.S. military retirement system (including payments from the Retired Serviceman's Family Protection Plan), and
- The U.S. government that relate to service with the Coast Guard, the commissioned corps of the National Oceanic and Atmospheric Administration, or the commissioned corps of the Public Health Service.
Your subtraction cannot be more than the amount of such retirement payments that you included in your federal income.
05 Local and State Retirement Benefits. You may subtract any payments received from the retirement systems listed on page 15 provided:
- You were retired from the system before January 1, 1964, or
- You were a member of the system as of December 31, 1963, retiring at a later date and payments you receive are from an account established before 1964, or
- You are receiving payments from the system as the beneficiary of an individual who met either condition 1 or 2.
Your subtraction cannot be more than the amount of such payments that you included in your federal income.
The specific retirement systems are:
Milwaukee City Employees, Milwaukee City Police Officers, Milwaukee Fire Fighters, Milwaukee Public School Teachers, Milwaukee County Employees, Milwaukee Sheriff, and Wisconsin State Teachers retirement systems.
Note. Do not subtract any of the following:
- Payments received as a result of voluntary tax-sheltered annuity deposits in any of the retirement systems listed above.
- Payments received from one of the retirement systems listed above if you first became a member after December 31, 1963. This applies even though pre-1964 military service may have been counted as creditable service in computing your retirement benefit.
CAUTION Your retirement benefits may be subtracted only if they are based on qualified membership in one of the retirement systems listed above. Qualified membership is membership that began before January 1964 as explained on page 14. Any portion of your retirement benefit that is based on membership in other retirement systems (or based on employment that began after December 31, 1963) is taxable and may not be subtracted.
Example 1. You were a member of the Wisconsin State Teachers Retirement System as of December 31, 1963. You left teaching after 1963 and withdrew the allowable amount from your retirement account. This closed the account. You later returned to teaching. A new retirement account was then established for you. Retirement benefits from this new account (established after 1963) do not qualify for the exemption.
Example 2. You were employed as a teacher from 1960-65. During that time you were a member of the Wisconsin State Teachers Retirement System. From 1966 until retirement, you were employed by a state agency (not as a teacher). You were then a member of the Wisconsin Retirement System. You receive an annuity from the Department of Employee Trust Funds. The annuity is based on employment in both retirement systems. Only the portion of the annuity that is due to the Wisconsin State Teachers Retirement System may be subtracted. You may use the following formula to figure the exempt amount that may be subtracted:
(Years of creditable service in an exempt plan / Total years of creditable service) x Annuity included in federal income = Portion of annuity which may be subtracted
Note You may have received separate Forms 1099-R for the taxable and exempt portions of your annuity. In this case, you may use the Form 1099-R information instead of the above formula.
06 Federal Retirement Benefits. You may subtract payments received from a federal retirement system provided:
- You were retired from the system before January 1, 1964, or
- You were a member of the system as of December 31, 1963, retiring at a later date and payments you receive are from an account established before 1964, or
- You are receiving payments from the system as the beneficiary of an individual who met either condition 1 or 2.
See "05 Local and State Retirement Benefits" on page 14 for further information. The limitations and examples that apply to local and state retirement benefits also apply to federal retirement benefits.
A "federal retirement system" is a United States government civilian employee retirement system. Examples of such retirement systems include the Civil Service Retirement System and the Federal Employees' Retirement System. Payments from the federal Thrift Savings Plan do not qualify for the subtraction.
07 Railroad Retirement Benefits, Railroad Unemployment Insurance, and Sickness Benefits Wisconsin does not tax amounts received from the U.S. Railroad Retirement Board. You may subtract such amounts if they were included in your federal adjusted gross income.
However, if you included tier 1 railroad retirement benefits (RRB) as part of your taxable social security (SS), use the following formula to figure your subtraction for your tier 1 RRB:
(Tier 1 RRB / Total tier 1 RRB and SS received ) x Taxable SS* = Subtraction for RRB
* From line 20b of federal Form 1040 or line 14b of Form 1040A. However, if you computed a subtraction for social security on the Wisconsin Social Security Benefits Worksheet for line 9 on page 11, use the amount from line 5 of that worksheet.
08 Adoption Expenses. If you adopted a child for whom a final order of adoption was entered by a Wisconsin court during 2007, you may subtract up to $5,000 of the amount you paid for adoption fees, court costs, and legal fees relating to the adoption. You may include amounts paid during 2005, 2006, and 2007. Don't count amounts reimbursed under any adoption assistance program. If you adopt more than one child during the year, you may deduct up to $5,000 of adoption expenses for each child.
09 Recoveries of Federal Itemized Deductions. Fill in any amount included as income on your federal tax return that is a recovery of a federal itemized deduction from a prior year for which you did not receive a Wisconsin tax benefit.
Example. You claimed an itemized deduction on your 2006 federal tax return for a casualty loss of $2,000. You could not claim the casualty loss for the itemized deduction credit on your 2006 Wisconsin income tax return. During 2007 you received a reimbursement of $1,000 from your insurance company for part of the casualty loss. The $1,000 reimbursement is included on your 2007 federal tax return as a recovery of an amount previously claimed as an itemized deduction.
Because you did not claim the casualty loss for the itemized deduction credit for Wisconsin for 2006, the $1,000 is not taxable to Wisconsin for 2007. Fill in the $1,000 recovery on line 11.
10 Wisconsin Net Operating Loss Carryforward. If you had a net operating loss (NOL) in an earlier year to carry forward to 2007, include the allowable amount on line 11. Enclose a statement showing how you figured the amount. Get Publication 120, Net Operating Losses for Individuals, Estates, and Trusts, for more details on computing the NOL and the allowable deduction. See page 6 for information on how to get this publication.
11 Native Americans. Certain income (for example, wages) earned by a Native American who both lives and works on his or her tribal reservation is not subject to Wisconsin income tax and may be subtracted. See Publication 405, Wisconsin Taxation of Native Americans, for more information.
12 Amounts Not Taxable by Wisconsin. You may subtract any amounts not taxable by Wisconsin (less related expenses except those expenses which are used to calculate the Wisconsin itemized deduction credit) which have been included as income on your federal tax return or excluded from federal deductions.
Example. Wisconsin doesn't tax certain relocation assistance payments received by persons displaced by condemnation, subject to the conditions in sec. 32.19 of the Wisconsin Statutes.
13 Farm Loss Carryover. If you were subject to farm loss limitations (see instructions for line 4, Item 01 for a description) on your 1992 or subsequent year Wisconsin income tax return, you may be able to claim a subtraction for all or a portion of the farm loss disallowed in those years. Farm losses disallowed as a deduction may be carried forward for 15 years to the extent that the farm losses are not offset against farm income of any year between the loss year and the year for which the carryover is claimed. The amount of carryover that can be subtracted is the lesser of (1) the farm loss carryover or (2) the net profits and net gains from the sale or exchange of capital or business assets in the current year from the same farming business or portion of that business to which the limits on deductible farm losses applied in the loss year.
Example You have a farm loss carryover from 2006 of $30,000. For 2007 you report a net loss of $2,000 on Schedule F and a net gain of $6,000 from the sale of farm equipment on Form 4797. The gain and loss are from the same farming business to which the limitation applied in the loss year. You may subtract $6,000 as a farm loss carryover on line 11.
14 Contributions to a Wisconsin State-Sponsored College Savings Program You may be able to subtract the amount you contributed to a Wisconsin state-sponsored college savings account (for example, EdVest or "tomorrow's scholar").
The beneficiary of the account must be either you, your spouse (if married filing joint return), your child who is claimed as a dependent on your federal income tax return, your grandchild, great-grandchild, niece, or nephew. The subtraction is equal to the amount you contributed to the account during 2007, but not more than $3,000 per beneficiary. In the case of a married couple filing a joint return, the total deduction per beneficiary by the married couple may not exceed $3,000 each year.
For example, you have two children whom you claim as dependents on your federal return. You established EdVest accounts for each child. In 2007, you contributed $3,000 to the account of each child. You may claim a subtraction of $6,000.
Limitation Your subtraction may not be more than the total of your wages, salaries, tips, unearned income, and net earnings from a trade or business. If you are married and filing a joint return, the limitation is based on the total of both spouses' income from these sources.
15 Distributions from Wisconsin State-Sponsored College Savings and Tuition Programs If you included earnings from a qualified college savings or tuition program in your federal adjusted gross income, you may subtract that amount if either of the following applies:
- The earnings were due to a qualified withdrawal from a Wisconsin state-sponsored college savings account (for example, EdVest or "tomorrow's scholar" college savings account).
- The earnings were from a Wisconsin EdVest tuition unit account and you received a refund because the beneficiary completed the program in which he or she was enrolled and had not used all of the tuition units purchased; or the beneficiary was awarded a scholarship, tuition waiver, or similar subsidy that could not be converted to cash.
16 Disability Income Exclusion If you are retired on permanent and total disability and have included your disability income on line 1 of Form 1, you may be able to subtract up to $5,200 of your disability income. You must meet ALL these tests:
- You did not reach mandatory retirement age before January 1, 2007.
- You were under age 65 on December 31, 2007.
- You were permanently and totally disabled
- when you retired, or
- on January 1, 1976, or January 1, 1977, if you retired before January 1, 1977, on disability or under circumstances which entitled you to retire on disability.
- If you were married at the end of 2007, you must file a joint return.
- You did not in any year prior to 1984 choose to treat your disability income as a pension instead of taking the exclusion.
- Your federal adjusted gross income is less than $20,200 ($25,400 if married and both spouses are eligible).
Compute your exclusion on Wisconsin Schedule 2440W, Disability Income Exclusion. Enclose Schedule 2440W with your Form 1. See page 6 for information on how to get this form.
17 Sale of Business Assets or Assets Used in Farming to a Related Person You may subtract the taxable portion of gain you realize from the sale or disposition to a related person of business assets or assets used in farming if the following conditions apply:
- The related person is your child, grandchild, great-grandchild, parent, brother or sister, nephew or niece, grandparent, great-grandparent, or aunt or uncle. The person may be related to you by blood, marriage, or adoption.
- The asset was held by you for more than 12 months.
- The gain is treated as capital gain for federal tax purposes. Amounts treated as ordinary income do not qualify.
Gain on the sale or disposition of shares in a corporation or trust qualifies only if:
- The number of shareholders or beneficiaries does not exceed 15. Lineal ancestors and descendants and aunts, uncles, and 1st cousins thereof count collectively as one shareholder or beneficiary. This collective authorization may not be used for more than one family in a single corporation or trust.
- The corporation does not have more than two classes of shares.
- All shareholders or beneficiaries, other than any estate, are natural persons.
Farming "Farming" means the cultivation of land or the raising or harvesting of any agricultural or horticultural commodity including the raising, shearing, feeding, caring for, training, and management of animals. Trees (other than trees bearing fruit or nuts) are not treated as an agricultural or horticultural commodity. (Trees may qualify as a business asset, see below.)
Business Assets "Business assets" are assets used in an activity carried on for a livelihood or in good faith to make a profit. The facts and circumstances of each case determine whether or not an activity is a business. Regularity of activities and transactions and the production of income are important elements. You do not need to actually make a profit to be in a business as long as you have a profit motive. You do need, however, to make ongoing efforts to further the interests of your business.
"Business assets" include assets used in the performance of services by an individual as an employee and assets used in the conduct of a trade or business by an individual who is self-employed.
"Business assets" do not include investment and rental property (for example, stocks, bonds, and residential rental property) unless you are subject to federal self-employment tax on the earnings from the activity. (Note Rental property which is a farm or farm equipment may qualify as an asset "used in farming.")
Computing the subtraction. You must first complete Wisconsin Schedule WD. The amount of gain that may be subtracted is determined after netting all capital gains and losses on Schedule WD.
- If amounts reported in Parts I and II of Schedule WD consist only of capital gains, your subtraction is equal to 40% of the long-term gain on the sale of the asset to the related person.
- If the amount on line 15 or 16 of Schedule WD is a net loss, you may not subtract any amount as gain on the sale of the asset to the related person.
- If the amount on line 16 of Schedule WD is a net gain and (1) the only gain reported on Schedule WD is from the sale of the asset to the related person and (2) you show a loss on line 14, column (f) of Schedule WD and/or on line 7 of Schedule WD, your subtraction is equal to the amount on line 19 of Schedule WD.
- If the amount on line 16 of Schedule WD is a net gain and (1) the only long-term gain reported on Schedule WD is from the sale of the asset to the related person, (2) you show a loss on line 14, column (f) of Schedule WD, and (3) you show a gain on line 7 of Schedule WD, your subtraction is equal to the amount on line 19 of Schedule WD less the amount on line 7 of Schedule WD.
- If the amount on line 16 of Schedule WD is a net gain and (1) that net gain includes more than one long-term capital gain and (2) you show a loss on line 14, column (f) of Schedule WD and/or on line 7 of Schedule WD, complete the worksheet below to compute your subtraction.
- If the amount on line 16 of Schedule WD is a net gain and (1) that net gain includes more than one long-term capital gain, (2) you show a loss on line 14, column (f) of Schedule WD, and (3) you show a gain on line 7 of Schedule WD, complete the worksheet below to compute your subtraction.
|
||||||||||||||||
18 Repayment of Income Previously Taxed. If you had to repay during 2007, an amount that you included in your Wisconsin income in an earlier year, you may be able to subtract the amount repaid. A subtraction may be claimed only for repayments that are allowed as a miscellaneous itemized deduction on line 27 or 28 of your federal Schedule A.
If you did not itemize deductions for federal tax purposes, use the amounts that would be deductible if you had itemized deductions. To determine the amounts to use, complete a federal Schedule A. Write "Wisconsin" at the top of this Schedule A and enclose it with your Form 1.
CAUTION Only amounts previously included in Wisconsin income may be claimed as a subtraction.
If the amount repaid was over $3,000, you may be able to subtract the repayment as described above or take a tax credit. See the line 44 instructions.
19 Human Organ Donation. If you, your spouse, or a person who is claimed as a dependent on your federal income tax return donates one or more of their human organs to another person for human organ transplantation, you may subtract up to $10,000 of unreimbursed expenses related to the organ donation. "Human organ" means all or part of a liver, pancreas, kidney, intestine, lung, or bone marrow. The subtraction may be claimed only in the taxable year in which the transplantation occurs. The subtraction may be claimed only once. Up to $10,000 of the following unreimbursed expenses may be claimed:
- Travel expenses.
- Lodging expenses.
- Lost wages.
20 Reserve or National Guard Members. If you were a member of the Reserves or National Guard and served on active duty, you may subtract any military pay that is included on your W-2 and was:
- Received from the federal government,
- Received after being called into active federal service or into special state service authorized by the federal Department of Defense, and
- Paid to you for a period of time during which you were on active duty.
CAUTION The subtraction only applies to members of the Reserves or National Guard who are called into active federal service under 10 USC 12302(a) or 10 USC 12304 or into special state service under 32 USC 502(f). However, it does not apply to pay that members of the Reserves and National Guard receive for their weekend or two-week annual training. It also does not apply to a person who is serving on active duty or full-time duty in the active guard reserve (AGR) program.
21 Manufacturer's Sales Tax Credit Adjustment. If you had unused manufacturer's sales tax credit from 1998 through 2005 of more than $25,000, see Schedule MS. Fill in the amount of your manufacturer's sales tax credit deduction from line 8 of 2007 Schedule MS.
22 Recapture of Development Zones Investment Credit. If you will be including an amount on line 37 as recapture of development zones investment credit, you may claim a subtraction for the amount of the recapture.
23 Legislator's Per Diem. If you were a Wisconsin legislator, you may subtract the amount of per diem reimbursement that is included as wages on line 7 of your federal Form 1040. This generally applies to a legislator with a residence 50 miles or less from the state capitol in Madison.
24 ATV Corridors. To the extent included in federal adjusted gross income, private landowners may subtract any Wisconsin incentive payments received for permitting public all-terrain vehicle corridors on their lands.
Additions To or Subtractions From Income
The following items may be either an addition to or a subtraction from federal adjusted gross income, depending on your situation. Fill in the code number and amount of any additions that apply to you on line 4. Fill in the code number and amount of any subtractions that apply to you on line 11.
51 Tax-Option (S) Corporation Adjustments. Fill in any of the following adjustments that apply to you:
- If you were a shareholder of a tax-option (S) corporation which is required to file a Wisconsin franchise or income tax return, you will receive a Wisconsin Schedule 5K-1 from the S corporation informing you of any adjustments to be made for Wisconsin tax purposes.
- If you are a shareholder of a federal S corporation that elects not to be treated as a Wisconsin tax-option (S) corporation, you must reverse all items of S corporation income, loss, or deduction included on your federal return and then add your pro rata share of any distributions made by the corporation of earnings and profits. (CAUTION Do not reverse any item of S corporation income or loss reported on federal Schedule D. These items have already been removed from Wisconsin income when you completed Wisconsin Schedule WD.)
- Instead of using tax-option (S) corporation items deductible on federal Schedule A to compute the Wisconsin itemized deduction credit, you may elect to treat these items as subtraction modifications. Your subtraction is limited to the amount actually deductible for federal purposes.
For more information, get Publication 102, Wisconsin Tax Treatment of Tax-Option (S) Corporations and Their Shareholders. See page 6 for information on how to get this publication.
52 Your Share of Partnership, Trust, or Estate Adjustments. If you were a member of a partnership or you received income from an estate or trust, you will receive a statement from the partnership, trust, or estate notifying you of any additions or subtractions which you should make on your return. Fill in the amount of any such additions on line 4 and any subtractions on line 11.
53 Differences in Federal and Wisconsin Basis of Assets. Additions or subtractions may be necessary if there is a difference between the federal basis and the Wisconsin basis of your property. Additions or subtractions are necessary if:
- You acquired property after December 31, 1964, which may be depreciated or amortized (such as buildings and leaseholds), and the federal basis is greater or less than the Wisconsin basis.
- You sold (or otherwise disposed of) property which may not be depreciated or amortized (such as land, stocks, and bonds) in a taxable transaction, and your basis in the assets was greater or less for federal purposes than for Wisconsin.
Example You sold stock which you acquired by inheritance and your federal basis was greater than your Wisconsin basis. You must make an adjustment for the difference in basis.
Compute the amount of any addition or subtraction due to a difference in basis on Wisconsin Schedule T, Transitional Adjustments. Enclose a completed Schedule T with your Form 1. See page 6 for information on how to get this form.
CAUTION If the difference in basis is due to the difference in the federal and Wisconsin definition of the Internal Revenue Code, use Schedule I to adjust for the difference in basis rather than Schedule T.
54 Differences in Federal and Wisconsin Basis of Partnership Interest. An addition or subtraction may be necessary if you sold your interest in a partnership and any increases or decreases were made to the federal basis of your partnership interest in taxable years prior to 1975, which resulted from partnership business or property located outside Wisconsin. (Prior to 1975, Wisconsin did not tax income from business or property located outside Wisconsin.) Compute any addition or subtraction due to a difference in basis on Wisconsin Schedule T.
55 Differences in Federal and Wisconsin Reporting of Marital Property (Community) Income.If you are married filing a separate return or married filing as head of household or if you obtained a decree of divorce or separate maintenance during 2007, you may have to report a different amount of income on your Wisconsin Form 1 than on your federal Form 1040. Fill in on line 4 any additional amount which is taxable to you rather than your spouse because of any difference in federal and state reporting of marital property (community) income. Fill in on line 11 any amount which is taxable to your spouse rather than to you because of any difference in federal and state reporting of marital property (community) income. For further information, get Publication 109, Tax Information for Married Persons Filing Separate Returns and Persons Divorced in 2007. See page 6 for information on how to get this publication.
Line 15 Standard Deduction
Most people can find their standard deduction by using the Standard Deduction Table on page 41. Use the amount on line 14 to find the standard deduction for your filing status. But, do not use the table if any one of the following applies:
- You (or your spouse if filing a joint return) can be claimed as a dependent on another person's (for example, parent's) income tax return. Use the Standard Deduction Worksheet for Dependents below to figure your standard deduction.
- You are filing a short period income tax return or are filing federal Form 4563 to claim an exclusion of income from sources within U.S. possessions. You are not allowed any amount of standard deduction. Fill in 0 on line 15.
|
||||||||||||||
Line 17 Exemptions
Complete lines 17a and 17b. Fill in the number of exemptions on the lines provided. Multiply that number by the amount indicated ($700 or $250), and fill in the result on line a or b, as appropriate. Fill in the total of the amounts on lines 17a and 17b on line 17c.
Line 17a. If you filed:
- Federal Form 1040 or 1040A, your number of exemptions is found in box 6d of your federal return.
- Federal Form 1040EZ, your number of exemptions is:
- 0- If you are single and you checked the "You" box on line 5 of your federal return, or if you are married filing jointly and you checked both the "You" and "Spouse" boxes on line 5 of your federal return.
- 1- If you are single and did not check the "You" box on line 5 of your federal return, or if you are married filing jointly and you checked only one box (either "You" or "Spouse") on line 5 of your federal return.
- 2- If you are married filing jointly and did not check either box on line 5 of your federal return.
Line 17b. If you or your spouse were 65 or older, check the appropriate lines. Your number of exemptions is equal to the number of lines checked.
Line 19 Tax
Use the amount on line 18 to find your tax in the Tax Table on pages 34-39. Find your income-level bracket and read across to the column showing your filing status to find your tax. Be sure you use the correct column in the Tax Table for your filing status. Fill in your tax on line 19.
EXCEPTION If the amount on line 18 is $100,000 or more, use the Tax Computation Worksheet on page 40 to compute your tax.
Line 20 Itemized Deduction Credit
If the total of certain federal itemized deductions exceeds your Wisconsin standard deduction, you may claim the itemized deduction credit.
Complete Schedule 1 on page 4 of Form 1 to see if you can claim the credit. Schedule 1 lists the specific deductions to use from federal Schedule A (see EXCEPTIONS on page 20).
If you did not itemize deductions for federal tax purposes, use the amounts which would be deductible if you had itemized deductions. To determine the amounts to use, complete a federal Schedule A. Write "Wisconsin" at the top of this Schedule A and enclose it with your Form 1.
EXCEPTIONS Even though Schedule 1 has entry lines for medical expenses, interest paid, and gifts to charity, not all of the amounts of these items that are deducted on federal Schedule A can be used for the itemized deduction credit. The following describes the portion of these items that may not be used to compute the itemized deduction credit.
- Medical expense- s the amount of medical care insurance and long-term care insurance claimed as a subtraction on line 11.
- Interest -
- paid on a second home located outside Wisconsin.
- paid on a residence which is a boat.
- paid to purchase or hold U.S. government securities.
- Contributions and interest allocated to you by a tax-option (S) corporation if you treated the amount as a subtraction on line 11.
Line 21 Armed Forces Member Credit
The armed forces member credit is available to certain members of the U.S. armed forces. You may claim the credit if you meet all of the following:
- You were on active duty, and
- You received military pay from the federal government in 2007, and
- The military pay was for services performed while stationed outside the United States.
Note You may notclaim the armed forces member credit if you were on active duty as a member of the Reserves or National Guard and you excluded certain military pay from your income. See Item 20 on page 18 of the instructions for information on the exclusion.
The credit is equal to the amount of military pay you received for services performed while stationed outside the United States, but not more than $300. If you are married filing a joint return and both spouses qualify for the credit, each may claim up to $300.
Line 22 Renter's and Homeowner's School Property Tax Credit
You may claim a credit if you paid rent during 2007 for living quarters used as your primary residence OR you paid property taxes during 2007 on your home. You are eligible for a credit whether or not you claim homestead credit on line 45.
NoteYou may not claim the school property tax credit if you or your spouse are claiming the veterans and surviving spouses property tax credit.
Special Cases
If You Paid Both Property Taxes and Rent You may claim both the renter's credit and the homeowner's credit. The total combined credit claimed on lines 22a and 22b may not be more than $300 ($150 if married filing a separate return or married filing as head of household).
Married Persons Filing a Joint Return Figure your credit by using the rent and property taxes paid by both spouses.
Married Persons Filing Separate Returns or Married Persons Filing as Head of Household Each spouse may claim a credit. Each of you may use only your own property taxes and rent to figure the credit. The maximum credit allowable to each spouse is $150.
Persons Who Jointly Own a Home or Share Rented Living Quarters When two or more persons (other than husband and wife) jointly own a home or share rented living quarters, each may claim a credit. However, the property taxes and rent paid must be divided among the owners or occupants. See the instructions for lines 22a and 22b.
Line 22a How to Figure the Renter's School Property Tax Credit
Step 1 Rent Paid in 2007. Fill in on the appropriate line(s) the total rent that you paid in 2007 for living quarters (1) where the heat was included in the rent, and (2) where the heat was not included in the rent. These living quarters must have been used as your principal home. Do not include rent that you may claim as a business expense. Do not include rent paid for housing that is exempt from property taxes, for example, rent for a university dorm, nonprofit senior housing, or public housing. (Property owned by a public housing authority is considered tax-exempt unless that authority makes payments in place of property taxes to the city or town in which it is located. If you live in public housing, you may wish to ask your manager about this.)
If the rent you paid included food, housekeeping, medical, or other services, reduce the amount filled in for rent paid in 2007 by the value of these items. If you shared living quarters with one or more persons (other than your spouse or dependents), fill in only the portion of the rent which you paid in 2007. For example, if you and two other persons rented an apartment and paid a total rent of $3,000 in 2007, and you each paid $1,000 of the rent, each could claim a credit based on $1,000 of rent.
Step 2. Refer to the Renter's School Property Tax Credit Table on page 21 to figure your credit. If heat was included in your rent, use Column 1 of the table. If heat was not included, use Column 2. Fill in your credit on line 22a.
Exception If you paid both rent where heat was included and rent where heat was not included, complete the worksheet below.
|
||||||||||
Line 22b How to Figure the Homeowner's School Property Tax Credit
Step 1 Property Taxes Paid on Home in 2007 Fill in the amount of property taxes that you paid in 2007 on your home. Do not include:
- Charges for special assessments, delinquent interest, or services that may be included on your tax bill (such as trash removal, recycling fee, or a water bill).
- Property taxes that you can claim as a business expense (for example, farm taxes or rental property taxes).
- Property taxes paid on property that is not your primary residence (such as a cottage or vacant land).
- Property taxes that you paid in any year other than 2007.
Property taxes are further limited as follows:
- If you bought or sold your home during 2007, the property taxes of the seller and buyer are the taxes set forth for each in the closing agreement made at the sale or purchase. If the closing agreement does not divide the property taxes between the seller and buyer, divide them on the basis of the number of months each owned the home.
- If you owned a mobile home during 2007, property taxes include the parking permit fees paid to your municipality and/ or the personal property taxes paid on your mobile home. (Payments for space rental should be filled in as rent on line 22a.)
- If you, or you and your spouse, owned a home jointly with one or more other persons, you may only use that portion of the property taxes that reflects your percentage of ownership. For example, if you and another person (other than your spouse) jointly owned a home on which taxes of $1,500 were paid, each of you would claim a credit based on $750 of taxes.
CAUTION Property taxes paid during 2007 must be reduced by any amounts received as a refund of such taxes. For example, a taxpayer claimed farmland preservation credit (which is considered a refund of property taxes) on his or her 2006 Wisconsin return. The taxpayer received a farmland preservation credit in 2007 of $600 that was based on 2006 property taxes accrued of $6,000. The 2006 property taxes were paid in 2007 and 10% of such taxes were allocable to the personal residence and 90% to the farm property. Thus, for tax purposes, property taxes paid on the entire property during 2007 are $5,400 ($6,000 less $600 farmland preservation credit). Of this amount, $540 (10% of $5,400) is used to compute the 2007 school property tax credit.
Step 2. Use the Homeowner's School Property Tax Credit Table below to figure your credit. Fill in the amount of your credit on line 22b.
CAUTION If you are also claiming the renter's credit on line 22a, the total of your renter's and homeowner's credits can't be more than $300 ($150 if married filing a separate return or married filing as head of household).
Line 23 Historic Rehabilitation Credits
Any individual who has received certification or approval of a project from the State Historical Society of Wisconsin may be eligible for the credits. Credits attributable to a partnership or tax-option (S) corporation pass through to the partners or shareholders (see Schedule 3K-1 or 5K-1). Credits may also be allocated to beneficiaries of estates and trusts (see Schedule 2K-1).
If you qualify to claim either of the historic rehabilitation credits, complete Wisconsin Schedule HR. Fill in the amount from Schedule HR on line 23. Enclose Schedule HR and the required certification with Form 1.
Exception If you are only claiming credits that are passed through from an estate or trust, partnership, or tax-option (S) corporation, you do not have to complete Schedule HR. Fill in the total historic rehabilitation credits from your Schedule 2K-1, 3K-1, or 5K-1 on line 23. Enclose a copy of the schedules with Form 1.
Line 24 Working Families Tax Credit
If your income is less than the amount indicated below for your filing status, you may claim the working families tax credit.
Exception You may not claim the working families tax credit if you may be claimed as a dependent on another person's (for example, your parent's) income tax return.
Single, Head of Household, or Married Filing Separate Return
- If the amount on line 14 of Form 1 is $9,000 or less, your working families tax credit is equal to your tax. Fill in the amount from line 19 of Form 1 on line 24.
- If the amount on line 14 of Form 1 is more than $9,000 but less than $10,000, use the worksheet below to compute your working families tax credit.
- If the amount on line 14 of Form 1 is $10,000 or more, leave line 24 blank. You do not qualify for the working families tax credit.
Married Filing Joint Return
- If the amount on line 14 of Form 1 is $18,000 or less, your working families tax credit is equal to your tax. Fill in the amount from line 19 of Form 1 on line 24.
- If the amount on line 14 of Form 1 is more than $18,000 but less than $19,000, use the worksheet below to compute your working families tax credit.
- If the amount on line 14 of Form 1 is $19,000 or more, leave line 24 blank. You do not qualify for the working families tax credit.
Working Families Tax Credit Worksheet Do not complete this worksheet if:
|
||||||||||||||||
|
Line 27 Alternative Minimum Tax
You may owe Wisconsin alternative minimum tax if you benefit from certain deductions, credits, and the special tax treatment of some kinds of income. This tax is figured on Schedule MT. Use the worksheet below to see if you must complete Schedule MT.
If line 10 of the worksheet is more than the amount on Form 1, line 26, fill in Schedule MT to see if you owe the alternative minimum tax. If line 10 is equal to or less than the amount on Form 1, line 26, do not fill in Schedule MT.
Include the following adjustments and preference items on line 2 of the worksheet below.
Adjustment and Tax Preference Items
- Accelerated depreciation.
- Amortization of pollution control facilities or depletion.
- Stock received by exercising an incentive stock option and you did not dispose of the stock in the same year.
- Intangible drilling, circulation, research, experimental, or mining costs.
- Income or (loss) from tax shelter farm activities or passive activities.
- Income from long-term contracts not figured using the percentage of completion method.
- Interest paid on a home mortgage not used to buy, build, or substantially improve your home.
- Investment interest expense reported on Form 4952.
- Wisconsin net operating loss deduction.
- Alternative minimum tax adjustments from an estate, trust, tax-option (S) corporation, partnership, or a cooperative.
See page 6 for information on how to get Schedule MT.
Worksheet To See If You Should Fill in Schedule MT Caution If you are married filing separately and line 3 of this worksheet is more than $165,000, you should fill in Schedule MT |
||||||||||||||||||||
|
Line 29 Married Couple Credit
You can claim the married couple credit if:
- You are married filing a joint return, and
- Both you and your spouse have qualified earned income, and
- You do not file federal Form 2555 or Form 2555EZ to claim an exclusion of foreign earned income or Form 4563 to claim an exclusion of income from sources in U.S. possessions.
To figure the credit, fill in Schedule 2 on page 4 of Form 1. Figure earned income separately for yourself and your spouse on lines 1 through 3 in Columns (A) and (B) of Schedule 2.
"Earned income" includes taxable wages, salaries, tips, scholarships or fellowships (only amounts reported on a W-2), other employee compensation, disability income treated as wages, and net earnings from self-employment.
"Earned income" does not include other income such as interest, dividends, IRA distributions, deferred compensation (even though it may be reported on a W-2), unemployment compensation, rental income, social security, pensions, annuities, or income that is not taxable to Wisconsin. Do not consider marital property law, marital property agreements, or unilateral statements in figuring each spouse's earned income.
The credit is based on qualified earned income. You must figure qualified earned income separately for yourself and your spouse. Figure it on lines 4 and 5 of Schedule 2 by subtracting the total of certain adjustments from earned income. These adjustments (and the related lines on federal Form 1040) are:
- IRA deduction (line 32),
- Self-employed SEP, SIMPLE, and qualified plans (line 28),
- Repayment of supplemental unemployment benefits (included in the total on line 36),
- Certain business expenses of reservists, performing artists, and fee-basis government officials (line 24),
- Contributions to secs. 403(b) and 501(c)(18) pension plans (included in the total on line 36), and
- Disability income exclusion (from line 11 of Wisconsin Form 1).
Line 30 Other Credits
Include the following credits on lines a through h of line 30. Fill in the total of the amounts on lines a through h on line 30i. To find out if you can take any of these credits, see the appropriate schedule. Enclose a copy of the completed schedule(s) with Form 1.
a Schedule MS Manufacturer's Sales Tax Credit. If you had unused manufacturer's sales tax credit from 1998 through 2005, complete Schedule MS to determine the amount of carryover credit you may claim for 2007. Fill in the amount of your available manufacturer's sales tax credit carryforward from line 7 of Schedule MS on line 30a.
b Schedule DI Dairy and Livestock Farm Investment Credit. The dairy and livestock farm investment credit is based on the amount paid for dairy or livestock farm modernization or expansion related to the operation of a dairy or livestock farm in Wisconsin. See Schedule DI.
c Schedule DC Development Zones Credit. Special tax credits may be available to persons doing business in Wisconsin development zones. If you qualify for the development zones credit, complete Wisconsin Schedule DC. Fill in the amount of your credit from Schedule DC on line 30c.
d Schedule TC Technology Zone Credi.t The technology zone credit may be available for persons doing business in Wisconsin technology zones. If you qualify for the technology zone credit, complete Wisconsin Schedule TC. Fill in the amount of your credit from Schedule TC on line 30d.
e Schedule VC(Part I) Angel Investment Credit. The angel investment credit is available to accredited investors who make a bona fide angel investment in a qualified new business venture that is certified by the Department of Commerce. See Schedule VC.
f Schedule VC(Part II) Early Stage Seed Investment Credit..The early stage seed investment credit is based on an investment paid to a fund manager certified by the Department of Commerce that the fund manager invests in a certified business. See Schedule VC.
g Schedule IE Internet Equipment Credit. A credit is available based on the purchase of Internet equipment used in the broadband market. The amount of credit must be certified by the Department of Commerce (DOC). Enclose a completed Schedule IE and a copy of the DOC certification with your Form 1. (Note For 2007 returns, this credit is only available to fiscal filers with a tax year beginning on or afterAugust 1, 2007.)
h Schedule OS Credit for Net Tax Paid to Another State. If you paid tax both to Wisconsin and another state on the same income, you may be able to claim a credit for such tax. Read the Schedule OS instructions to determine if you may claim the credit. If you qualify for the credit, complete Schedule OS. Fill in the amount of your credit from Schedule OS on line 30h. Be sure to enter in the box on line 30h the 2-letter postal abbreviation for the other state to which you paid tax. If you paid tax to more than one other state, fill in the number "99" in the box.
CAUTION Credit cannot be claimed for taxes paid to Illinois, Indiana, Kentucky, Michigan, or Minnesota on personal service income (such as wages, salaries, tips, commissions, bonuses, etc.) you received from working in one of those states. Instead, file a return with that state to get a refund of any tax withheld from your wages. Be sure to explain on that state's return that you were a Wisconsin resident when earning the wages in that state. See Publication 121, Reciprocity, for more information.
Line 33 Recycling Surcharge
The recycling surcharge applies to individuals who have trade or business activities in Wisconsin (including activities as a statutory employee) and have $4,000,000 or more of gross receipts from trade or business activities for federal income tax purposes.
If you are subject to the recycling surcharge, complete Wisconsin Schedule RS. Fill in the amount from line 2 or 3 of Schedule RS on line 33 of Form 1. Enclose a copy of Schedule RS with Form 1.
Line 34 Sales and Use Tax Due on Out-of-State Purchases
Did you make any taxable purchases from out-of-state firms in 2007 on which sales and use tax was not charged? If yes, you must report Wisconsin sales and use tax on these purchases on line 34 if they were stored, used, or consumed in Wisconsin. You must also report sales and use tax on taxable purchases from a retailer located in another country, regardless of whether you were charged any tax for that country or any duty by the U.S. Customs Service.
Taxable purchases include furniture, carpet, clothing, computers, books, CDs, DVDs, cassettes, video tapes, artwork, antiques, jewelry, coins purchased for more than face value, etc.
Example You purchased $300 of clothing through a catalog or over the Internet. No sales and use tax was charged. The clothing was delivered in a county with a 5% tax rate. You are liable for $15 Wisconsin tax ($300 x 5% = $15) on this purchase.
Complete the worksheet below to determine whether you are liable for Wisconsin sales and use tax.
Worksheet for Computing
|
Sales and Use Tax Rate Chart In all Wisconsin counties except those shown in a through d below,the tax rate was 5.5% for all of 2007.
|
Line 35 Donations
You may designate amounts as a donation to one or more of the programs listed on lines 35a through 35g. Your donation will either reduce your refund or be added to tax due. Add the amounts on lines 35a through 35g and fill in the total on line 35h.
Line 35a Endangered Resources Donation. With your gift, the Endangered Resources Program works to protect and manage native plant and animal species, natural communities, and other natural features. Gifts up to a predetermined amount will be matched by state general purpose revenue. Fill in the amount you want to donate on line 35a.
Line 35b Packers Football Stadium Donation. Your Packer football stadium donation will be used for maintenance and operating costs of the professional football stadium in Green Bay. Fill in the amount you want to donate on line 35b.
Line 35c Breast Cancer Research Donation. Your breast cancer research donation will be divided equally between the Medical College of Wisconsin, Inc., and the University of Wisconsin Comprehensive Cancer Center for breast cancer research projects. Fill in the amount you want to donate on line 35c.
Line 35d Veterans Trust Fund Donation. Your donation to the Veterans Trust Fund will be used by the Wisconsin Department of Veterans Affairs for the benefit of veterans or their dependents. Fill in the amount you want to donate on line 35d.
Line 35e Multiple Sclerosis Donation Donations will be forwarded to the National Multiple Sclerosis Society to be distributed to entities located in Wisconsin that operate health-related programs for people in Wisconsin with multiple sclerosis. Fill in the amount you want to donate on line 35e.
Line 35f Firefighters Memorial. You may donate an amount towards a firefighters memorial. Fill in the amount you want to donate on line 35f.
Line 35g Prostate Cancer Research Donation. Your prostate cancer research donation will be divided equally between the Medical College of Wisconsin, Inc., and the University of Wisconsin Comprehensive Cancer Center for prostate cancer research projects. Fill in the amount you want to donate on line 35g.
Line 36 Penalties on IRAs, Other Retirement Plans, MSAs, Etc.
The Wisconsin penalty on IRAs, retirement plans, medical savings accounts (MSAs), etc., is equal to 33% of the following federal taxes:
- Tax on IRAs, other qualified retirement plans, etc., (line 60 of federal Form 1040). Do not include any amount from line 8 or 49 of federal Form 5329.
- Total tax due from lines 4, 17, 25, 33, 41, and 53 of federal Form 5329 (include only if the tax due on this form was paid separately and is not included on line 60 of your Form 1040).
- Tax on excess contributions (line 2 of federal Form 5330).
- Tax on prohibited transactions (lines 6a and 6b of federal Form 5330).
- Section 72(m)(5) excess benefits tax (included in the total on line 63 of federal Form 1040).
- Tax onArcher MSAdistributions (line 11b of federal Form 8853).
If you were subject to any of the above federal taxes for 2007, fill in the total of such taxes in the space provided on line 36. Multiply the amount filled in by .33 (33%) and fill in the result on line 36.
Note You are not subject to the penalty on payments from certain retirement plans if the payments are exempt from Wisconsin tax. See the instructions for line 11, Items 05 and 06, for information on retirement payments that are exempt from Wisconsin tax and to which the penalty does not apply.
If you were required to file federal Form 5329 or 5330, enclose a copy of your Form 5329 and/or 5330 with your Form 1.
Line 37 Credit Repayments and Other Penalties
If you are required to repay a Wisconsin credit or are subject to a penalty for selling business or farming assets purchased from a related person, fill in the amount of the repayment or penalty on line 37. See below for further information.
- Recapture of development zones investment credit You may be required to recapture development zones investment credit if you disposed of or stopped using in a development zone any property for which you claimed the investment credit in a prior year. See Part IV of Schedule DC for further information. Fill in the amount from line 34 of Schedule DC on line 37.
- State historic rehabilitation credit You may have to repay all or part of the state historic rehabilitation credit if you disposed of the property within 5 years after the date on which the preservation or rehabilitation work was complete or the Wisconsin Historical Society determines that you have not complied with all of the requirements. Contact any department office for information on determining the amount to be repaid.
- Angel investment credit If an investment for which you claimed the angel investment credit in a prior year was held for less than one year, you must repay the amount of the credit that you received related to the investment.
- Penalty for selling business