Withholding Tax Update - Wisconsin Department Of Revenue

December 2012

WITHHOLDING TAX UPDATE

Federal Treatment

15, Employer’s Tax Guide, directs governments to report payments of $600 or more

Internal Revenue Service

Publication

to election workers for services performed in national, state, county, and municipal elections on Form W-2. Governments

must report payments less than $600 to election workers on Form W-2 if social security or Medicare taxes were withheld.

Wages paid to election workers are not subject to federal income tax withholding.

EXEMPTION FOR COUNTY FAIR ASSOCIATIONS INCREASED

Effective January 1, 2012, a county fair association is not required to withhold from an employee who receives less than

$500 annually in wages or salary from the association. Under prior law, the exemption amount was $100.

JOB CREATION DEDUCTION

For taxable years beginning on or after January 1, 2011, a subtraction from federal income is allowed based on the

increase in the number of full-time equivalent employees that are employed in Wisconsin during the taxable year. The

subtraction from federal income is equal to $2,000 per eligible employee for businesses with gross receipts of greater than

$5 million and $4,000 per eligible employee for businesses with gross receipts of $5 million or less.

Use Schedule JC to claim the job creation deduction. For more information on this deduction, go to

revenue.wi.gov/taxpro/fact/jobcreation.pdf. For clarification on the calculation of full-time equivalent employees, see

Administrative Rule 3.05(2)(c).

RELOCATED BUSINESS CREDIT OR DEDUCTION

Corporate Franchise/Income Tax – For taxable years beginning on or after January 1, 2011, for two consecutive taxable

years beginning with the year in which the taxpayer’s business relocates to Wisconsin from another state or country and

begins doing business in Wisconsin, a credit is allowed equal to the amount of income or franchise tax liability after

applying all other allowable credits, deductions, and exclusions.

Individual and Fiduciary Income Taxes – For taxable years beginning on or after January 1, 2011, for two consecutive

taxable years beginning with the year in which the taxpayer’s business relocates to Wisconsin from another state or

country and begins doing business in Wisconsin, a subtraction from federal income is allowed for the net business income

earned by the relocated business.

Use Schedule RB to claim the relocated business credit or deduction. For more information on this deduction, go to

revenue.wi.gov/taxpro/fact/relocated.pdf.

VETERAN EMPLOYMENT CREDIT

For taxable years beginning on or after January 1, 2012, this credit is available to businesses who have hired certain

disabled veterans. For each qualifying veteran hired for a full-time job, the credit is $4,000 in the taxable year in which

the veteran is hired and $2,000 in each of the next three taxable years.

For each qualifying veteran hired for a part-time job, the credit is up to $2,000 in the taxable year in which the veteran is

hired and up to $1,000 in each of the next three taxable years.

The veteran must not have voluntarily or involuntarily left his or her employment with the employer during the taxable

year for which the employer is computing the credit. That is, if the veteran leaves employment during the taxable year for

any reason, the employer cannot compute the credit based on that veteran.

Specific definitions and limitations apply to this credit. See

revenue.wi.gov/taxpro/fact/veteran.pdf

for more information.

MY TAX ACCOUNT UPDATE

We have continued to improve My Tax Account based on your feedback.

New features include:

• Third party preparer access to submit name and address changes, request to close or reactivate accounts, view

collection information and request payment plans

• Additional tax types, such as pass-through withholding, composite returns and certain excise taxes

• Revised payment page

• Performance optimization and visual enhancements

• Revised email reminders

Withholding Tax Update - Wisconsin Department Of Revenue - 2012 Page 5

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