Wis. Admin. Code § Tax 14.03 — Household income and income

Tax 14.03(1) (1) Purpose. This section clarifies the meaning of“household income” and “income” includable in household income as the terms apply to homestead credit claims.

Tax 14.03(2) (2) Definitions. In this section:

Tax 14.03(2)(a) (a) “Household income” has the meaning specified in s. 71.52 (5) , Stats.

Tax 14.03(2)(b) (b) “Income” has the meaning specified in s. 71.52 (6) , Stats.

Tax 14.03(3) (3) Deduction for dependents.

Tax 14.03(3)(a) (a) Under s. 71.52 (5) , Stats., a deduction of $500 is allowed for each of the claimant’s dependents, as defined in s. 152 of the Internal Revenue Code, who have the same principal abode as the claimant for more than 6 months during the calendar year to which a claim for homestead credit relates. A claimant may multiply the number of dependents with the same principal abode for more than 6 months by $500 and subtract the result from the total of the income items to arrive at household income.

Tax 14.03(3)(b) (b) A dependent is considered to have the same principal abode as the claimant during temporary absences from the claimant’s homestead for reasons such as school attendance, illness, vacations, business commitments or military service.

Tax 14.03(3)(c) (c) In the following situations, a dependent who does not have the same principal abode as the claimant for more than 6 months during the calendar year to which a claim for homestead credit relates is nonetheless considered to have the same principal abode for more than 6 months if during that year:

Tax 14.03(3)(c)1. 1. The dependent is born or dies, and the dependent has the same principal abode as the claimant during the entire time the dependent is alive during that year.

Tax 14.03(3)(c)2. 2. The dependent is adopted by the claimant, is placed with the claimant for adoption or becomes the stepchild of the claimant, and the dependent has the same principal abode as the claimant from that time to the end of that calendar year.

Tax 14.03(4) (4) Items includable in income. Under s. 71.52 (6) , Stats., income includes the sum of:

Tax 14.03(4)(a) (a) “Wisconsin adjusted gross income” as defined in s. 71.01 (13) , Stats., for the calendar year to which a claim for homestead credit relates.

Tax 14.03(4)(b) (b) The following amounts to the extent not included in Wisconsin adjusted gross income:

Tax 14.03(4)(b)1. 1. Maintenance payments, not including foster care maintenance and supplemental payments excludable under s. 131 of the internal revenue code.

Tax 14.03(4)(b)2. 2. Court-ordered support payments, including support for dependents under ch. 49 , Stats.

Tax 14.03(4)(b)3. 3. Cash public assistance and county relief, including the following:

Tax 14.03(4)(b)3.a. a. Aid to families with dependent children, or “AFDC.”

Tax 14.03(4)(b)3.b. b. Wisconsin works, or “W-2” payments.

Tax 14.03(4)(b)3.c. c. Non-legally responsible relative, or “NLRR” AFDC payments or kinship care payments under s. 48.57 , Stats. These are payments received as a relative other than a parent, for caring for a dependent child in the claimant’s homestead.

Tax 14.03(4)(b)3.d. d. Cash benefits paid by counties under s. 59.53 (21) , Stats.

Tax 14.03(4)(b)3.e. e. Reimbursement from a governmental agency for amounts originally paid for by the recipient, not including cash reimbursements for home energy assistance or for services under Title XX of the federal social security act and community options program, or “COP” payments under s. 46.27 , 2017 Stats.

Tax 14.03(4)(b)3.f. f. Adoption assistance payments under Title IV-E of the federal social security act or from another state, or payments by the Wisconsin department of children and families under s. 48.975 , Stats., to adoptive parents of children having special needs as described in s. DCF 50.03 (1) (b) .

Tax 14.03(4)(b)3.g. g. Veterans administration payments for reimbursement of services purchased by the recipient.

Tax 14.03(4)(b)3.h. h. Federal housing and urban development, or “H.U.D.” payments for housing.

Tax 14.03(4)(b)3.i. i. Disaster relief grants under the federal disaster relief act of 1974.

Tax 14.03(4)(b)4. 4. The gross amount of a pension or annuity, including:

Tax 14.03(4)(b)4.a. a. Railroad retirement benefits.

Tax 14.03(4)(b)4.b. b. Veterans’ disability pensions.

Tax 14.03(4)(b)4.c. c. Any amounts withheld by the payor.

Tax 14.03(4)(b)4.d. d. Nontaxable recoveries of cost.

Tax 14.03(4)(b)4.e. e. Disability income exclusions from taxable income.

Tax 14.03(4)(b)5. 5. Except as provided in subd. 3. e. , all payments received for the benefit of a claimant or a member of the claimant’s household under the federal social security act, including:

Tax 14.03(4)(b)5.a. a. All federal social security retirement, disability or survivorship benefits.

Tax 14.03(4)(b)5.b. b. Lump sum death benefits.

Tax 14.03(4)(b)5.c. c. Medicare premiums deducted from social security benefits received by all members of a household.

Tax 14.03(4)(b)5.d. d. Supplemental security income, or “SSI” benefits received by persons over 65 years of age, or blind or disabled.

Tax 14.03(4)(b)5.e. e. Supplemental security income - exceptional needs, or “SSI-E” payments under s. 49.77 (3s) , Stats.

Tax 14.03(4)(b)6. 6. Compensation and other cash benefits received from the United States for past or present service in the armed forces.

Tax 14.03(4)(b)7. 7. Payments made to surviving widows, widowers or parents of veterans by the United States, but not including insurance proceeds received by beneficiaries of National Service Life Insurance.

Tax 14.03(4)(b)8. 8. Proceeds from a personal endowment insurance policy or annuity contract purchased by the recipient.

Tax 14.03(4)(b)9. 9. The gross amount of “loss of time” insurance proceeds.

Tax 14.03(4)(b)10. 10. Nontaxable interest received from the federal government or any of its instrumentalities, or from state or municipal bonds.

Tax 14.03(4)(b)11. 11. Scholarship and fellowship gifts or income and other educational grants, not including student loans.

Tax 14.03(4)(b)12. 12. Unemployment insurance, including railroad unemployment compensation.

Tax 14.03(4)(b)13. 13. Workers’ compensation.

Tax 14.03(4)(b)14. 14. Capital gains not included in Wisconsin adjusted gross income, but not including a nonrecognized gain from an involuntary conversion under s. 1033 of the internal revenue code.

Tax 14.03(4)(b)15. 15. A gain on the sale of a personal residence excluded under s. 121 of the internal revenue code. A gain on the sale of a personal residence which would be reportable under the installment sale method if taxable may be reported either in full in the year of sale or each year as payments are received.

Tax 14.03(4)(b)16. 16. Dividends not included in Wisconsin adjusted gross income.

Tax 14.03(4)(b)17. 17. Income of a nonresident or part-year resident married to a full-year resident of Wisconsin.

Tax 14.03(4)(b)18. 18. A housing allowance provided to a member of the clergy.

Tax 14.03(4)(b)19. 19. The amount by which a resident manager’s rent is reduced.

Tax 14.03(4)(b)20. 20. Income of a Native American which is nontaxable under ch. 71 , Stats.

Tax 14.03(4)(b)21. 21. Income from sources outside of Wisconsin which is nontaxable under ch. 71 , Stats.

Tax 14.03(4)(b)22. 22. Nontaxable deferred compensation.

Tax 14.03(4)(c) (c) The following items deducted in determining Wisconsin adjusted gross income, including items deducted in arriving at partnership, limited liability company and tax-option “S” corporation income or losses reported as a part of Wisconsin adjusted gross income: