Instructions For Completing Wisconsin Schedule

INSTRUCTIONS FOR COMPLETING WISCONSIN SCHEDULE

– 2001

– Generally, the Wisconsin Statutes require

SPECIFIC INSTRUCTIONS

that the computation of taxable income on the 2001 Wisconsin

income tax return is to be based on the Internal Revenue Code

(Numbered to correspond with the line numbers on Schedule I)

enacted as of December 31, 1999. Changes to the Internal

Revenue Code enacted after December 31, 1999, do not apply

for Wisconsin income tax purposes.

1. Fill in your 2001 federal adjusted gross income from line 33

Wisconsin law also provides that the following provision of

of your federal Form 1040.

federal law does not apply for Wisconsin purposes (even though

this provision was enacted into federal law prior to December 31,

2 & 3. If you sold or otherwise disposed of certain property

1999):

during 2001, the gain or loss reportable from such sale

may differ for Wisconsin and federal purposes due to

• The exclusion for 50% of the gain from the sale or exchange

Schedule I adjustments made in the current year or a

of qualified small business stock issued after August 10, 1993,

prior year. This would occur, for example, when differ-

and held for more than five years.

ent rates of depreciation or amortization were allowable

for Wisconsin and federal purposes in 1975 or thereafter.

As a result, certain income and deduction items may be different

for Wisconsin and federal purposes. Any difference must be

To properly report such gain or loss on your Wisconsin

adjusted on this schedule. A description of items requiring

return, you must first remove all gain or loss included in

adjustment can be found under ITEMS REQUIRING ADJUST-

your federal adjusted gross income. This is done by

MENT.

filling in line 2a or 2b and/or line 3a or 3b. Then fill in the

revised gain or loss on line 2c and/or line 3c. Attach a

– If the computation of your federal

revised federal Schedule D, Form 4684, or Form 4797

adjusted gross income or itemized deductions reflects any of the

marked “Revised for Wisconsin purposes” to Form 1 or

differences in Wisconsin and federal law for 2001, you must

Form 1NPR.

complete this schedule and attach it to your Wisconsin income

tax return, Form 1 or Form 1NPR.

Do not complete lines 2 and 3 if you did not make

Schedule I adjustments in the current year or a prior year

To the extent Schedule I adjustments in a prior year affect income

for the property you sold or otherwise disposed of during

or expense items in 2001 (for example, ACRS depreciation was

2001.

not allowed to be claimed on residential real property or certain

farm property placed in service during 1986), you must also

5. Complete line 5 to make all other adjustments needed to

make adjustments on Schedule I for 2001.

convert 2001 federal adjusted gross income to the amount

allowable for Wisconsin. See the listing under Section A of

It also may be necessary to prepare a 2001 Schedule I to adjust

ITEMS REQUIRING ADJUSTMENT.

the amount of gain or loss reportable from sales of certain assets

during 2001. See the instructions for lines 2 and 3 under

When an adjustment is made on line 2, 3, or 5, this may affect

SPECIFIC INSTRUCTIONS.

other amounts which must then also be adjusted. For example,

the amount of social security includable in federal adjusted

gross income may be affected when an adjustment is made to

an income item. The adjustment to social security includable

– The income and deduction items

in federal adjusted gross income should be reported on

computed on the Wisconsin returns of partnerships, estates and

line 5.

trusts, and tax-option (S) corporations may also be affected by

the differences between Wisconsin and federal law for 2001. As

When completing line 5, if you are adjusting an expense item

a result, the distributive shares of these items which are report-

(for example, depreciation or amounts claimed as Adjustments

able on the individual Wisconsin income tax returns of the

to Income on lines 23 through 31a of federal Form 1040), fill

respective partners, beneficiaries, and shareholders may differ

in the amounts in Col. I and Col. II as negative numbers. Put

for Wisconsin and federal income tax purposes. Such partners,

parentheses around the amounts to show negative numbers.

beneficiaries, and shareholders should receive notification from

the partnership, estate or trust, or tax-option (S) corporation of

If you are adjusting an income item, fill in the amounts in

the amounts reportable for Wisconsin purposes. By comparing

Col. I and Col. II as positive numbers.

the amounts reportable for Wisconsin and federal purposes, the

partner, beneficiary, or shareholder should determine the items

which differ and make the appropriate adjustments.

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Instructions For Completing Wisconsin Schedule - 2001

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