Agriculture Credit - Crop Insurance Proceeds Considered Production Gross Receipts

This is a proposed guidance document. The document has been submitted to the Legislative Reference Bureau for publication in the Administrative Register for public comment as provided by sec. 227.112(1), Wis. Stats.

On Tuesday, March 3, 2020, Governor Tony Evers signed 2019 Wisconsin Act 167 which allows crop insurance proceeds to be included in production gross receipts when computing the agriculture tax credit for taxable years beginning on or after January 1, 2019.

The Act defines production gross receipts as follows:

For taxable years beginning on or after January 1, 2019, production gross receipts are:

The sum of gross receipts from the lease, rental, license, sale, exchange, or other disposition of qualified production property and insurance proceeds received as a result of the destruction of, or damage to, crops to the extent the proceeds are included in federal adjusted gross income for the taxable year.

For taxable years beginning before January 1, 2019, production gross receipts are:

Gross receipts from the lease, rental, license, sale, exchange, or other disposition of qualified production property.

If the law change affects the amount of agriculture credit computed on a previously filed 2019 income or franchise tax return, taxpayers may amend their return to compute the correct amount of credit.

The manufacturing and agriculture tax credit common questions have been updated to reflect the law change.

Applicable Laws and Rules

This document provides statements or interpretations of the following laws and regulations enacted as of March 6, 2020: Sections 71.07(5n) and 71.28(5n), Wis. Stats.

Laws enacted and in effect after March 6, 2020, new administrative rules, and court decisions may change the interpretations in this document. Guidance issued prior to March 6, 2020, that is contrary to the information in this document is superseded by this document, pursuant to sec. 73.16(2)(a), Wis. Stats.

Guidance Document Certification: https://www.revenue.wi.gov/Pages/Certification-Statement.aspx

Guidance Document Number: 100259

March 6, 2020