Instructions For Completing Wisconsin Schedule

(a) Federal – Any annuity contract described in

(a) Federal – The basis of stock received in a tax-free

sec. 403(b), IRC, for the benefit of a participant shall

incorporation must be reduced (but not below the

be treated as a defined contribution plan maintained

stock’s fair market value) by the amount of any

by each employer with respect to which the partici-

liability that (1) is assumed in the exchange for such

pant has the required control. Any contribution to a

stock, and (2) did not otherwise reduce the

simplified employee pension plan shall be treated as

transferor’s basis of the stock by reason of the

an employer contribution to a defined contribution

assumption. (Public Law 106-554)

plan. In the case of any annuity contract described in

(b) Wisconsin – The basis of stock received in a tax-free

sec. 403(b), the amount of the contribution disquali-

incorporation is determined under the provisions of

fied by reason of sec. 415(g) shall reduce the

the Internal Revenue Code as amended to Decem-

exclusion allowance. A plan may disregard the

ber 31, 1999.

requirements regarding the exclusion allowance

under sec. 403(b) that contributions to a defined

benefit pension plan be treated as previously

excluded amounts. (Public Law 107-16)

(a) Federal – Gain or loss from a securities futures

contract (except dealer securities futures contracts)

(b) Wisconsin – The treatment of benefits from a defined

is generally treated the same as gain or loss from

contribution plan is determined under the provisions

transactions in the underlying security, and such gain

of the Internal Revenue Code in effect on Decem-

or loss takes on the same character as the property to

ber 31, 1999.

which the contract relates has, or would have, in the

hands of the taxpayer. Any capital gain or loss

resulting from the sale or exchange of a securities

(a) Federal – If there is a nonallocation year with respect

futures contract to sell property generally will be

to an ESOP maintained by an S corporation, the

short-term capital gain or loss. A securities futures

amount allocated in a prohibited allocation to an

contract will not be treated as a commodities futures

individual who is a disqualified person is treated as

contract. Gain or loss from a “dealer securities

distributed to such individual. This applies to plan

futures contract” is considered a “section 1256

years ending after March 14, 2001, of an ESOP

contract” which requires it to be marked to market on

established after March 14, 2001, or an ESOP estab-

the last day of the year. (Public Law 106-554)

lished on or before such date if employer securities

(b) Wisconsin – The treatment of securities futures

held by the plan consist of stock in a corporation that

contracts is determined under the provisions of the

was not an S corporation on that date. (Public Law

Internal Revenue Code as amended to December 31,

107-16)

1999.

(b) Wisconsin – The treatment of an S corporation ESOP

is determined under the provisions of the Internal

Revenue Code in effect on December 31, 1999.

(a) Federal – A taxpayer may elect to (1) deduct one-half

of any qualified revitalization expenditures

chargeable to capital account with respect to any

(a) Federal – Restitution payments made to a person (or

qualified revitalization building for the taxable year

the person’s heirs) who was persecuted on the basis

in which the building is placed in service, or (2)

of race, religion, physical or mental disability, or

deduct all such expenditures ratably over the

sexual orientation by Nazi Germany, any other Axis

120-month period beginning with the month in which

regime, or any other Nazi-controlled or Nazi-allied

the building is placed in service. (Public Law

country are not included in gross income. (Public

106-554)

Law 107-16)

(b) Wisconsin – The election related to qualified revital-

(b) Wisconsin – The treatment of restitution payments is

ization expenditures is not available for Wisconsin.

determined under the provisions of the Internal

Revenue Code in effect on December 31, 1999.

(

Although they must be included in federal

adjusted gross income used as the starting point for

calculating Wisconsin taxable income, restitution

payments may subsequently be subtracted. See

page 15 of the Form 1 instructions or page 17 of the

Form 1NPR instructions.)

Instructions For Completing Wisconsin Schedule - 2001 Page 3

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