Wisconsin does not require pass-through entities to report differences between the withholding tax computed and amount paid as estimated withholding tax payments. To illustrate, a tax-option (S) corporation makes $3,000 in estimated withholding tax payments for each of its two shareholders throughout the taxable year. At the end of the taxable year, the S-corporation computes each shareholder's share of Wisconsin taxable income to be $30,000.
In filling out Part 2 of Form PW-1, the S-corporation enters $30,000 in column E for each shareholder. In column F the S-corporation enters $2,325 for each shareholder. In this example, each shareholder has $0 in credits. The resulting amount for column H, Withholding Tax Computed, is $2,325 for each shareholder.
In filling out the Schedules 5K-1 for each shareholder, the S-corporation would be required to report on Schedule 5K-1, line 13w, the total amount of withholding tax computed ($2,325), not the total amount paid in estimated withholding tax payments ($3,000). In other words, the amount on line 13w should be the amount entered on Form PW-1, Part 2, column H for that particular shareholder.
May 4, 2010