Instructions For 2016 Schedule Qi - Sale Of Investment In A Qualified Wisconsin Business Page 4
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9Example 2 (Deferred Gain)
• C corporation XYZ was a qualified Wisconsin business for 2011, 2012, 2013, and 2014.
• The purchase of the 200 shares on 5-31-2011 included $5,000 of deferred long-term capital gain from an asset previously
sold.
• 900 Shares in C corporation XYZ were sold on 8-30-2016 at $100 per share as follows:
(The chart below reflects federal basis and has not been adjusted for Wisconsin)
Shares Sold
Selling Price
Basis of
Date of Purchase
Shares Purchased
Gain
08-30-2016
$100/Sh.
Shares Sold
5-31-2009
200
200
$20,000
$40,000
($20,000)
5-31-2010
200
200
$20,000
$50,000
($30,000)
$5,000
5‑31‑2011
200
200
$20,000
$15,000
6‑30‑2011
200
200
$20,000
$5,000
$15,000
6-30-2012
100
100
$10,000
$5,000
$5,000
Total
900
900
$90,000
$105,000
($15,000)
• Only the shares purchased on 5-31-2011 and 6-30-2011 are considered a qualified Wisconsin investment.
– Shares in XYZ purchased in 2009 and 2010 do not qualify because XYZ was not a qualified Wisconsin business at the
time of the investment.
– Shares purchased in 2012 are not a qualified Wisconsin investment because the shares were not held for at least five
years.
• In this example the investment made on 5-31-2011 includes a $5,000 deferred long-term capital gain from an asset previously
sold.
– The deferred long-term gain of $5,000 must be reported on Schedule T and Schedule WD.
– The basis on line 6 of Schedule QI must be adjusted to reflect the $5,000 of deferred long-term gain. This will result in a
$100,000 basis ($105,000 - $5,000) on line 6 of Schedule QI.
• The gain of $30,000 ($15,000 + $15,000) on the sale of the 400 shares from 2011 is qualified gain reported on line 10 of
Schedule QI and must be reported on line 15a of Schedule WD. The net taxable gain from the sale of the investment is
$25,000.
• The sale of the investment is entered on Schedule QI as follows:
Line 1
Date investment sold: 08 30 2016
Line 2
Purchase date of initial investment in the qualified Wisconsin business: 05 31 2011
Line 3
Type of investment:
X
Stock purchase
Partnership interest
LLC membership
Line 4
Entity Name:
XYZ Inc.
FEIN: xx-xxxxxxx
Line 5
Sales price of investment as reported on federal Form 8949 . . . . . . . . . . . . . . . . . . . .
90000
Line 6
Cost or other basis adjusted for Wisconsin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
100000
Line 7
Deferred long-term gain included in the investment . . . . . . . . . . . . . . . . . . . . . . . . . . .
5000
Line 8
Add line 6 and line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
105000
Line 9
Amount used to determine non-taxable qualified gain.
Subtract line 8 from line 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
- 15000
Non‑taxable Long‑Term Gain
Line 10 Amount you computed to be non-taxable qualified gain.
(Enter on line 15a of Schedule WD) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
30000
Taxable Long‑Term Gain
Line 11
Add line 6 and line 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
130000
Line 12 Net taxable long-term gain or (loss). Subtract line 11 from 5 . . . . . . . . . . . . . . . . . . .
- 40000
- 4 -
I-177 (N. 12-16)
Wisconsin Department of Revenue
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