Wisconsin Administrative Code › Department of Revenue › Chapter Tax 2 - Income Taxation, Returns, Records And Gross Income › Section Tax 2.63 - Controlled group election

Current through June 24, 2024
(1) SCOPE. Section
			 71.255(2m),
			 Stats., allows a commonly controlled group of corporations to elect to include
			 every member of the commonly controlled group in a single combined group for
			 combined reporting purposes. This section provides rules relating to making the
			 election, continuity of the election, and limitations of the
			 election.
(2) MAKING THE ELECTION.
			 Preapproval by the department is not required to make the election. The
			 designated agent of the combined group shall make the election on behalf of the
			 group as described in this subsection. Paragraph (c) provides rules relating to
			 identifying the designated agent in cases where a commonly controlled group
			 consists of corporations that previously filed as more than one combined group.
(a)
Time period for making
			 election.
The designated agent shall make the election on an original,
			 timely filed combined return which includes all members of the commonly
			 controlled group. A return shall be considered timely if it is filed by the
			 designated agent on or before the due date of the return, including applicable
			 extensions. If the return is timely filed without an extension, the designated
			 agent may make the election by filing an amended combined return on or before
			 the end of the automatic 7-month extension period provided in s.
			 71.24(7)
			 or
			 71.44(3),
			 Stats. A return filed after the end of the automatic 7-month extension period,
			 whether an original or amended return, may not constitute a valid controlled
			 group election for the taxable year to which the return applies, although an
			 election may be filed for a subsequent taxable year subject to the limitation
			 in sub. (3) (c).
(b)
Method
			 of election and required documentation.
1. For the first year the designated agent
			 makes the election, the designated agent shall check a designated line of the
			 combined return to indicate that a controlled group election is in
			 effect.
2. For the first year the
			 designated agent makes the election, the designated agent shall include a
			 statement with the combined return which lists every corporation that is a
			 member of the commonly controlled group, and indicates that each corporation
			 has agreed to be bound by the election and that the election shall apply to any
			 member that subsequently enters the group.
(c)
Multiple former combined
			 groups.
1. If a commonly controlled
			 group consists of corporations that previously filed as more than one combined
			 group, the controlled group election creates a new combined group. For purposes
			 of application of loss carryforwards and research credits under s.
			 Tax
			 2.61, each former combined group included in the new
			 combined group is a subgroup as described in s.
			 Tax
			 2.61(9) (e) 1. and the corporations
			 within each subgroup are eligible to share loss carryforwards and research
			 credits from taxable years prior to the election with all the members of that
			 subgroup, to the extent sharing would otherwise be allowed under s.
			 Tax
			 2.61(6) (c), (9), and (10).
2. A new combined group described in subd. 1.
			 shall appoint the designated agent of one of the former combined groups to be
			 the designated agent, and the provisions of s.
			 Tax
			 2.65 apply to that designated agent. The corporation
			 that files the first combined return under the election shall be deemed the
			 appointed designated agent for the new combined group.