Instructions for 2023 Schedule A-05:  Wisconsin Premiums Factor for Insurance 
                                          Companies 
                                                    
Purpose of Schedule A-05 

Insurance companies required to use apportionment must use the factor prescribed in sec. 71.45, Wis. Stats. 
 
Line-by-Line Instructions 
 
Share of Apportionment Factors 

Partnerships, corporations, and tax-option (S) corporations must generally include their share of the numerator 
and denominator of the partnership’s apportionment factors in the numerator and denominator of their 
apportionment factors. Include these amounts using the Wisconsin apportionment Schedules A-01 through A-11, 
as appropriate. 

■ Line 1. Direct Premiums – In the Wisconsin column, enter the direct premiums written on all property and risks 
other than life insurance, where the subject of insurance was resident, located, or to be performed in Wisconsin.  
 
In the Total Company column, enter the total direct premiums on all property and risks other than life insurance, 
wherever located during the taxable year. 
 
■ Line 2. Assumed Premiums – In the Wisconsin column, enter the assumed premiums from domestic insurance 
companies written for reinsurance on property and risks other than life insurance, where the subject of insurance 
was resident, located, or to be performed in Wisconsin.  
 
In  the Total Company column,  enter the assumed  premiums from  domestic insurance companies written for 
reinsurance on property and risks other than life insurance, wherever located during the taxable year. 
 
■  Line  4.  Apportionment  Percentage (separate return filers and pass-through entities)  – Divide  Wisconsin 
column, line 3, by Total Company column, line 3, and multiply that amount by 100. Fill all spaces to the right of 
the decimal point.  Round to the nearest ten-thousandth of a  percent (for  example, 12.3456%).  See the 
instructions of the tax  form you are filing (Form 1NPR, 2, 3, 4, 4T, 5S, or  6) for  how to report  and use this 
percentage. 
 
Conversion to Modified Sales Factor (combined return filers only) 

■ Line 5. Intercompany Sales (Combined Group Members Only) – Any sales made between members of the 
same combined group (“intercompany sales”), either directly or through interests in a pass-through entity, must 
be excluded from the amounts you entered on lines 1 and 2. 

Report the excluded amount of intercompany sales on line 5. If you already excluded these intercompany sales 
from the amounts you entered on lines 1 and 2, do not enter any amounts on line 5.  

Following are additional details about intercompany transactions that involve pass-through entities. For additional 
information, refer to sec. Tax 2.61(7)(e), Wisconsin Administrative Code. 

Sales to Pass-Through Entities Owned by Combined Group Members. If a combined group member makes 
a sale to a pass-through entity which is more than 50 percent owned, directly or indirectly, by members of the 
combined group, the member must eliminate an amount equal to the gross receipts of the sale multiplied by the 
sum of all combined group members’ interests in the pass-through entity as of the date of the sale. The examples 
below illustrate: 

IC-805 (R. 11-23)                                1 

                                           2023 Schedule A-05 Instructions 

Example 1: Combined Group LM consists of Member L and Member M. L owns a 40% interest in Partnership P. 
M owns a 60% interest in Partnership P. On March 1, 2023, L sells a widget to Partnership P for $10,000, and this 
sale is includable in Group LM’s combined unitary income. In its computation of apportionment factors for 2023, 
L must subtract  an amount of $10,000 (= $10,000 x (40% + 60%)) from  its sales factor denominator and, if 
applicable, from its numerator. 

Example 2: Assume the same facts as Example 1, except that Member L owns a 25% interest and M owns a 50% 
interest in Partnership P. In its computation of apportionment factors for 2023, L must subtract an amount of 
$7,500 (= $10,000 x (25% + 50%)) from its sales factor denominator and, if applicable, from its numerator. 

Sales by Pass-Through Entities Owned by Combined Group Members. If a pass-through entity makes a sale 
to a combined group member and more than 50 percent of the pass-through entity is directly or indirectly owned 
by members of the combined group, each member with an interest in the pass-through entity must subtract from 
its sales factor numerator and denominator any amount that would otherwise be included attributable to the sale. 
The example below illustrates: 

Example: Combined Group ST consists of Member S and Member T. S owns a 20% interest in Partnership R. T 
owns an 80% interest in Partnership R. On October 1, 2023, Partnership R sells a widget to S for $20,000, and 
this sale is includable in Group ST’s combined unitary income. In its computation of apportionment factors for 
2023, S must subtract an amount of $4,000 (= $20,000 x 20%) from its sales factor denominator and, if applicable, 
from its numerator. Similarly, T must subtract an amount of $16,000 (= $20,000 x 80%) from its sales factor 
denominator and, if applicable, from its numerator. 

■ Line 6. Sales Excluded from Combined Unitary Income (Combined Group Members Only) – If you reported 
an amount on Form 6, Part II, line 6 for separately apportioned income, you must exclude the sales attributable 
to that amount from the numerator and denominator of the sales factor, as applicable. Report the excluded amount 
of these sales on line 6. However, if you already excluded these sales from the amounts you entered on lines 1 
and 2, do not enter any amounts on line 6.  

See the instructions to Form N, Wisconsin Nonapportionable, Separately Accounted, and Separately Apportioned 
Income, for further details on how to report and apportion separately apportioned income. 

■ Line 9. Sales Previously Deferred (Combined Group Members Only)   – If a combined group member made a 
sale to another member of the combined group in a prior taxable year and gain or loss on the transaction was 
deferred under the provisions of sec. 71.255(4)(g), Wis. Stats., the selling member must include the gross receipts 
from the sale in its sales factor in the year the gain or loss is recognized, to the extent those gross receipts are 
otherwise includable in the sales factor.  

 NOTE: Section 71.255(4)(g), Wis. Stats., provides that the intercompany deferral provisions of Treas. Reg. 
 §1.1502-13 apply to a combined group similarly to how they apply to a consolidated group for federal purposes. 
 See the instructions to Form 6, Part I, line 33, for details.  
                                                                                                                 
Report the gross receipts corresponding to any income recognized under sec. 71.255(4)(g), Wis. Stats., on line 9. 
If you already included these receipts in the amounts you entered on lines 1 and 2, do not enter any amounts on 
line 9.  

Under sec. Tax 2.61(7)(d), Wisconsin Administrative Code, special sourcing rules apply to amounts reported on 
line 9. If a combined group member sells an item or service to another combined group member and the purchaser 
subsequently resells it to a third party outside of the group, the situs of both sales is determined based on the 
situs of the sale from the purchasing member to the third party. Also, the purchasing member must exclude from 
its apportionment factors the amount the selling member already included attributable to that same item or service. 
The example below illustrates:  

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                                          2023 Schedule A-05 Instructions 

Example:  

Combined Group YZ consists of Member Y and Member Z. Group YZ is on a calendar year. On December 30, 
2022, Y sells a widget with a cost of $400 to Z, for $600. Y ships the widget to Z’s warehouse in Wisconsin. On 
January 30,  2023, Z resells the widget to Q,  an  unrelated third party, for $700. Z ships the widget to  Q’s 
headquarters in Illinois. Assume both the sale by Y and the sale by Z are includable in combined unitary income, 
and assume that Z has nexus in Illinois.  

In 2022, Y did not recognize any gain on the sale to Z because the gain was deferred under the provisions of sec. 
71.255(4)(g), Wis. Stats. Since the gain on the sale was not recognized, Y cannot include the $600 sale in its 
apportionment factors for 2022.  

In 2023, Y must include its $200 of gain on the sale to Z (= $600 - $400) in combined unitary income. Y must also 
include the sale amount of $600 in its sales factor denominator for 2023. Z must include its $100 gain on the sale 
to Q (= $700 - $600) in combined unitary income for 2023. However, since $600 of Z’s sales price has already 
been included in Y’s sales factor, Z may only include the remaining $100 of the sale amount in its sales factor 
denominator. Neither Y nor Z include these amounts in their sales factor numerators since both sales are deemed 
to have a situs in Illinois where Group YZ has nexus.  
 
Additional Information and Assistance 
 
Web Resources  
 
The Department of Revenue’s web page, available at revenue.wi.gov, has several resources to provide additional 
information and assistance, including: 
 
• Related forms and their instructions  
• Common questions  
• Publications on specific tax topics 
• The Wisconsin Tax Bulletin  
• A home page specifically for combined reporting topics 
• Links to the Wisconsin Statutes and Administrative Code 
 
Contact Information  
 
If you cannot find the answer to your question in the resources available on the Department of Revenue’s web 
page, contact the Department using any of the following methods: 
 
• E-mail your question to: DORFranchise@wisconsin.gov 
• Call (608) 266-2772  
  (Telephone help is  also  available using TTY  equipment. Call the Wisconsin  Telecommunications Relay 
  System at 711 or, if no answer, (800) 947-3529. These numbers are to be used only when calling with TTY 
  equipment.) 
• Send a fax to (608) 267-0834 
• Write to the Audit Bureau, Wisconsin Department of Revenue, Mail Stop 3-107, PO Box 8906, Madison, WI  
  53708-8906 
 
                                          Applicable Laws and Rules 
  This document  provides statements  or interpretations of  the following laws and regulations  enacted  as of 
  December 1, 2023: Chapter 71 Wis. Stats., and Chapter Tax 2, Wis. Adm. Code 

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