creating a tax credit for insurers for certain investments in community development entities

Wisconsin Legislature: SB658: Bill Text

Skip navigation

Home

Documents

Senate

Assembly

Committees

Service Agencies

Docs

Options

Help

2025 Biennium

Statutes

Admin. Rules

Indices

Miscellaneous

Archives

Home

Bill, Rule, and Appointment Histories

Senators

Representatives

Committees

Text of Introduced Proposals

Amendment Text

Acts

Veto Messages

Enrolled Bills

Votes

Assembly and Senate Floor Calendars

Schedule of Committee Activities

Assembly and Senate Journals

Committee Records (ROCPs)

Legislative Rules

All Session-Related Documents

Subject Index to Acts

Subject Index to Legislation

Subject Index to Journals

Author Index to Legislation

Subject Index to Clearinghouse Rules

Miscellaneous Budget Documents

Executive Orders

Rulings of the Chair

Wisconsin Supreme Court Rules

Opinions of the Attorney General

Town Law Forms

Law

Districts

Session

Drafting Files

Feeds

Preferences

Show tree

Hide tree

Feedback

Help

Home

Senate Home

Senators

Committees

Session

Chief Clerk

Sergeant at Arms

Civics Education

Human Resources
Assembly Home

Representatives

Committees

Session

Chief Clerk

Sergeant at Arms

Human Resources
Schedule

Joint

Senate

Assembly

Study
Legislative Audit Bureau

Legislative Council

Legislative Fiscal Bureau

Legislative Human Resources Office

Legislative Reference Bureau

Legislative Technology Services Bureau

Menu
»
2025
»
Related Documents
»
Proposal Text
»
SB658: Bill Text

Up

Up

2025 - 2026 LEGISLATURE
LRB-1425/1
KP:amn&klm
2025 SENATE BILL 658
November 14, 2025 - Introduced by Senators
Marklein
and
James
, cosponsored by Representatives
Zimmerman
,
Armstrong
,
Behnke
,
Kreibich
and
Murphy
. Referred to Committee on Agriculture and Revenue.
SB658,1,3
1
An Act

to amend
76.67 (2);
to create
76.633 of the statutes;
relating to:

2
creating a tax credit for insurers for certain investments in community
3
development entities.
Analysis by the Legislative Reference Bureau
Under this bill, an insurer that makes a qualified equity investment in a qualified community development entity may receive a credit against the state taxes imposed on insurers. In order for the insurer to claim the credit, a qualified community development entity must use the capital raised from the insurer’s qualified equity investment to make investments in or loans to qualified active low-income community businesses that have their principal business operations in this state. The credit is equal to zero percent of the insurer’s qualified equity investment for the first and second year after the issuance of the investment, and 10 percent of the qualified equity investment for the next five years. The bill defines “qualified community development entity” as generally an entity that has the primary mission of serving or providing investment capital for low-income communities or low-income persons and that has low-income persons represented on a governing or advisory board of the entity. The bill defines a “qualified active low-income community business” as generally an entity that 1) receives at least 50 percent of its gross income from certain business conducted within a low-income community; 2) uses a substantial portion of its tangible property within a low-income community; 3) performs a substantial portion of its services within a low-income community; 4) has less than 5 percent of its property attributable to debt collection; and 5) receives less than 15 percent of its revenue from the rental or sale of real estate.
Under the bill, qualified community development entities must apply to the Department of Revenue for authority to issue qualified equity investments to insurers. DOR may approve up to a total of $125,000,000 in qualified equity investment authority for investment in qualified active low-income community businesses in rural counties and up to a total of $125,000,000 in such authority for investments in such businesses in metro counties. Also, DOR may approve an amount of qualified equity investment that generates no more than $25,000,000 in total credits per tax year. Under the bill, DOR may recapture credits from insurers if 1) the qualified community development entity receiving capital from qualified equity investments fails to use all of the capital to make investments in or loans to qualified active low-income community businesses; 2) if the qualified community development entity redeems or makes principal payment with respect to the qualified equity investment before the seventh anniversary of issuance of the investment; or 3) if any amount of the federal new markets tax credit that is available for a qualified equity investment is rescinded. Each qualified community development entity that is authorized to issue qualified equity investments under the bill must submit an annual report to DOR containing various information regarding the qualified low-income community investments made, including employment information for the qualified active low-income community businesses invested in the entity.
For further information see the state fiscal estimate, which will be printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:
SB658,1
1
Section
1
.
76.633 of the statutes is created to read:
SB658,2,3
2
76.633

Community development entity investment credit.

(1)

3
Definitions.
In this section:
SB658,2,5
4
(a) “Applicable percentage” means 0 percent for the first 2 credit allowance
5
dates and 10 percent for the next 5 credit allowance dates.
SB658,2,7
6
(b) “CDFI fund” means the community development financial institutions
7
fund of the U.S. treasury department.
SB658,3,2
1
(c) “Credit allowance date” means, with respect to any qualified equity
2
investment, any of the following dates:
SB658,3,3
3
1. The date on which the investment is initially made.
SB658,3,4
4
2. Each of the 6 anniversary dates of that date thereafter.
SB658,3,6
5
(d) “Metro county” means Columbia, Dane, Green, Iowa, Milwaukee, Ozaukee,
6
Washington, and Waukesha Counties.
SB658,3,9
7
(e) 1. “Principal business operations” means the place or places where at least
8
60 percent of a qualified active low-income community business’s employees work or
9
where employees that are paid at least 60 percent of the business’s payroll work.
SB658,3,15
10
2. “Principal business operations” includes places where an out-of-state
11
business agrees to relocate employees or an in-state business agrees to hire
12
employees using the proceeds of a qualified low-income community investment
13
when the business satisfies the definition under subd. 1. within 180 days, or by a
14
later date agreed by the department, after receiving the qualified low-income
15
community investment.
SB658,3,17
16
(f) “Purchase price” means the amount paid to a qualified community
17
development entity for a qualified equity investment.
SB658,4,3
18
(g) 1. “Qualified active low-income community business” has the meaning
19
given in section
45D
(d) (2) of the Internal Revenue Code except as provided in subd.
20
2. “Qualified active low-income community business” includes a business for the
21
duration that it receives a qualified low-income community investment if the
22
qualified community development entity reasonably expects at the time that it
23
makes the qualified low-income community investment in the business that the
24
business will continue to continue to be considered a qualified active low-income
1
community business under section
45
D (d) (2) of the Internal Revenue Code
2
throughout the entire period that it receives the qualified low-income community
3
investment.
SB658,4,10
4
2. “Qualified active low-income community business” does not include a
5
business that derives or projects to derive 15 percent or more of its annual income
6
from the rental or sale of real estate. This subdivision does not apply to a business
7
that is controlled by or under common control with another business if the 2nd
8
business does not derive or project to derive 15 percent or more of its annual income
9
from the rental or sale of real estate and is the primary tenant of the real estate
10
leased from the initial business.
SB658,4,16
11
(h) “Qualified community development entity” has the meaning given in
12
section
45D
(c) of the Internal Revenue Code but includes only entities that have
13
entered into, or that are controlled by an entity that has entered into, an allocation
14
agreement with the CDFI fund with respect to tax credits authorized under section
15
45D
of the Internal Revenue Code that includes this state within the service area
16
set forth in that allocation agreement.
SB658,4,18
17
(i) “Qualified equity investment” means any equity investment in a qualified
18
community development entity to which all of the following apply:
SB658,4,19
19
1. Either of the following applies:
SB658,4,21
20
a. The equity investment is acquired after December 31, 2024, at its original
21
issuance solely in exchange for cash.
SB658,4,24
22
b. The equity investment is acquired by an insurer and a prior holder of the
23
equity investment acquired it after December 31, 2024, at its original issuance
24
solely in exchange for cash.
SB658,5,4
1
2. The qualified community development entity uses at least 100 percent of
2
the purchase price of the equity investment to make qualified low-income
3
community investments in qualified active low-income community businesses that
4
have their principal business operations in this state.
SB658,5,6
5
3. The equity investment is designated by the community development entity
6
as a qualified equity investment under sub. (5).
SB658,5,11
7
4. If the qualified community development entity is not domiciled in this state
8
and the entity’s controlling entity, if any, is not domiciled in this state, the qualified
9
community development entity has designated at least 50 percent of the equity
10
investment as a qualified equity investment under section 45D of the Internal
11
Revenue Code.
SB658,5,13
12
5. The equity investment is certified by the department as not exceeding the
13
limit under sub. (4) (a).
SB658,5,15
14
(j) “Qualified low-income community investment” means any capital or equity
15
investment in, or loan to, a qualified active low-income community business.
SB658,5,16
16
(k) “Rural county” means any county in this state that is not a metro county.
SB658,5,22
17
(2)

Filing claims.
For taxable years beginning after December 31, 2024, an
18
insurer may claim as a credit against the fees due under s. 76.60, 76.63, 76.65,
19
76.66, or 76.67, for a taxable year in which the insurer holds a qualified equity
20
investment on its the allowance date, an amount equal to the applicable percentage
21
for that allowance date multiplied by the purchase price paid to the qualified
22
community development entity for the qualified equity investment.
SB658,6,4
23
(3)

Carry-forward.
If the credit under sub. (2) is not entirely offset against
24
the fees under s. 76.60, 76.63, 76.65, 76.66, or 76.67 otherwise due, the unused
1
balance may be carried forward and credited against those fees for following years
2
to the extent that it is not offset by those fees otherwise due in all the years between
3
the year in which the qualified entity investment was held on its allowance date and
4
the year in which the carry-forward credit is claimed.
SB658,6,8
5
(4)

Allocations; applications.
(a) 1. The department shall allocate
6
$125,000,000 in qualified equity investment authority for the credit under this
7
section for investment in qualified active low-income community businesses having
8
principal business operations in a rural county.
SB658,6,12
9
2. The department shall allocate $125,000,000 in qualified equity investment
10
authority for the credit under this section for investment in qualified active low-
11
income community businesses having principal business operations in a metro
12
county.
SB658,6,17
13
(b) 1. A qualified community development entity that seeks to have an equity
14
investment designated as a qualified equity investment that is eligible for the credit
15
under this section shall apply to the department for the rural allocation under par.
16
(a) 1. or the metro allocation under par. (a) 2. or both on a form provided by the
17
department and shall include all of the following:
SB658,6,20
18
a. The name, address, and tax identification number of the applicant and
19
evidence of the applicant’s certification as a qualified community development
20
entity by the CDFI fund.
SB658,6,22
21
b. A copy of the allocation agreement executed by the applicant or its
22
controlling entity and the CDFI fund.
SB658,7,2
23
c. A certificate executed by an executive officer of the applicant attesting that
1
the allocation agreement with the CDFI fund remains in effect and has not been
2
revoked or cancelled.
SB658,7,4
3
d. A description of the proposed amount, structure, and purchaser of the
4
equity investment.
SB658,7,10
5
e. The amount of qualified equity investment authority applied for from the
6
rural allocation or the metro allocation, or both, as applicable. If the applicant is
7
not domiciled in this state, the amount applied for under this paragraph may not
8
exceed an amount equal to twice the amount of qualified equity investment
9
authority under section
45D
of the Internal Revenue Code available to the
10
applicant or its controlling entity.
SB658,7,13
11
f. If the applicant is not domiciled in this state, evidence of the amount of
12
qualified equity investment authority under section 45D of the Internal Revenue
13
Code available to the applicant or its controlling entity.
SB658,7,14
14
g. A nonrefundable application fee of $5,000 paid to the department.
SB658,7,17
15
2. A qualified community development entity may apply for a portion of both
16
the rural allocation under par. (a) 1. and the metro allocation under par. (a) 2. of
17
qualified equity investment authority.
SB658,7,21
18
3. The department shall establish a date for beginning to accept applications
19
under this paragraph that is not less than 30 days but no more than 45 days after
20
the U.S. treasury department announces allocation awards for the CDFI fund for
21
the round of funding set forth in 89 Fed. Reg. 99283 to 99292 (November 21, 2024).
SB658,8,9
22
(5)

Certification of qualified equity investments.
(a) No later than 30
23
days after receiving an application under sub. (4) (b), the department shall approve
24
or deny the application in full or in part. If the department denies any part of the
1
application, the department shall inform the applicant of the grounds for the
2
denial. If the applicant provides any additional information required by the
3
department or otherwise amends its application within 15 days of the notice of
4
denial, the department shall consider the application complete as of the original
5
date of submission. If the applicant fails to provide the information or complete its
6
application within 15 days of the notice of denial, the application remains denied
7
and if the applicant submits an additional application, the department may not
8
consider the additional application complete as of the date of submission of the
9
original application.
SB658,8,13
10
(b) 1. If the department determines that an application is complete, the
11
department shall certify the equity investment proposed by the application as a
12
qualified equity investment that is eligible for the credit under this section, subject
13
to the limitations under this subsection.
SB658,8,15
14
2. The department shall provide written notice of a certification under subd.
15
1. to the applicant.
SB658,8,20
16
3. When a qualified community development entity certified under subd. 1.
17
knows the names of the persons who are allocated a credit under this section and
18
the respective credit amounts for each person, the qualified community
19
development entity shall provide to the department a notice containing the names
20
and credit amounts.
SB658,8,23
21
4. The department shall provide a certification containing the credit amounts
22
and utilization schedule to each person and qualified community development
23
entity described in subd. 3.
SB658,9,2
24
5. If the person eligible to claim a credit under this section changes because of
1
a transfer of a qualified equity investment, the qualified community development
2
entity shall notify the department of the change.

Down

Down

/2025/related/proposals/sb658

true

proposaltext

/2025/related/proposals/sb658

proposaltext/2025/REG/SB658

proposaltext/2025/REG/SB658

section

true

Menu
»
2025
»
Related Documents
»
Proposal Text
»
SB658: Bill Text

×

Details for

PDF view

Link
(Permanent link)

Bookmark this location

View toggle

Go to top of document

Search in this chapter

Search in this section

Search in this agency

Search in this chapter group

Search in this chapter

Search in this section

Cross references for section

Acts affecting this section

References to this

1970 Statutes Annotations

Appellate Court Citations

Administrative Code Index

Reference lines

Clear highlighting