PDF document

- 1 -

                           Instructions for 2023 Schedule 4V:  
                  Wisconsin Additions to Federal Income 

Purpose of Schedule 4V 

Corporations complete Schedule 4V to report addition modifications that are needed to account for differences be-
tween taxable income under Wisconsin law and under federal law. The corporation files Schedule 4V with its Wis-
consin Form 4.  
   
Line-by-Line Instructions 
 
■Line 1. Interest Income   –Enter interest income received on state and municipal obligations and any other interest 
income that is exempt from federal income tax and isn’t included in federal taxable income. 

Corporations subject to the Wisconsin income tax rather than the franchise tax shouldn’t enter interest income on line 
1 that is exempt from income tax under both Wisconsin and federal law. This includes interest on the following types 
of obligations: 

•  Public housing authority or community development authority bonds issued by municipalities located in Wisconsin 
•  Wisconsin Housing Finance Authority bonds 
•  Wisconsin municipal redevelopment authority bonds 
•  Wisconsin Housing and Economic Development Authority bonds issued on or after December 11, 2003, to fund 
   multifamily affordable housing or elderly housing projects 
•  Wisconsin Housing and Economic Development Authority bonds  issued before January 29, 1987, except 
   business development revenue bonds,  
   economic development revenue bonds, and CHAP housing revenue bonds 
•  Public housing agency bonds issued before January 29, 1987, by agencies located outside Wisconsin where the 
   interest therefrom qualifies for exemption from federal taxation for a reason other than or in addition to section 
   103 of the IRC 
•  Local exposition district bonds 
•  Wisconsin professional baseball park district bonds 
•  Bonds issued by the Government of Puerto Rico, Guam, the Virgin Islands or, for bonds issued after October 16, 
   2004, the Government of American Samoa 
•  Local cultural arts district bonds 
•  Wisconsin professional football stadium bonds 
•  Wisconsin Aerospace Authority bonds 
•  Bonds issued on or after October 27, 2007, by the Wisconsin Health and Education Facilities Authority to fund 
   acquisition of information technology hardware or software 
•  Conduit revenue bonds issued under sec. 66.0304, Wis. Stats., if the bonds or notes are used to fund multifamily 
   affordable housing projects or elderly housing projects in Wisconsin and the Wisconsin Health and Education 
   Facilities Authority has the authority to issue the bonds.  The bonds or notes are used by a health facility to fund 
   the acquisition of information technology hardware or software  in  Wisconsin and the  Wisconsin Health  and 
   Educational Facilities  Authority  has the  authority to issue the bonds.  Bonds or notes  issued  to fund a 
   redevelopment project or housing project in Wisconsin. 
•  Bonds issued by the Wisconsin Housing and Economic Development Authority to provide loans to a public affairs 
   network  
•  Wisconsin Health and Educational Facilities Authority Bonds if the bonds or notes are issued for the benefit of a 
   person who is eligible to receive the proceeds from another entity for the same purpose for which the bonds or 
   notes are issued and the interest income received from the other bonds or notes is exempt from Wisconsin 

IC-123 (R. 11-23)                                      1

- 2 -

                                              2023 Schedule 4V Instructions 
 
  taxation. 
• The bonds or notes are issued to fund a redevelopment project in this state or a housing project in this state, and 
  the authority exists for bonds or notes to be issued by an entity described under s. 66.1201, 66.1333, or 66.1335. 
• Bonds or notes issued by the Wisconsin Health and Educational Facilities Authority under sec. 231.03(6), Wis. 
  Stats., if the bonds or notes were issued in an amount totaling $35 million or less, and the interest income is not 
  otherwise exempt.  

■ Line 2. State Taxes – Enter taxes imposed by Wisconsin, any other state, and the District of Columbia that are 
value-added taxes, single business taxes, or taxes on or measured by net income, gross income, gross receipts, or 
capital stock and that were deducted in computing federal taxable income.  

 NOTE: The state taxes you add back on line 2 should include all components of the Texas Margins Tax regardless 
 of which computation is used. However, the Ohio Commercial Activity Tax is not required to be added back since it 
 is deductible.  
                                                                                                                            
■ Line 3. Related Entity Expenses –       A corporation must make an addition modification to “add back” expenses 
attributable to transactions with related parties. The expenses that must be added back include the following, if paid, 
accrued, or incurred to a related entity: 
• Interest expenses 
• Rent expenses 
• Management fees 
• Intangible expenses 

Corporations that are partners, members, or beneficiaries of pass-through entities must include on line 3 their share 
of the pass-through entity’s related entity expenses shown on line 22a of Schedule 3K-1 and line 14a of Sched-
ule 2K-1, as applicable. 
 
 NOTE: If the corporation meets one of the specific conditions provided in the Wisconsin Statutes, the corporation 
 may take a subtraction modification on Schedule 4W for some or all of the amount added back on Schedule 4V, 
 line 3. See the instructions for Schedule 4W, line 2 for details.  
                                                                                                                    
Definitions Applicable to Line 3. In determining whether an addback of related entity expenses is necessary, the 
following definitions apply:   

“Related entity”   –A related person under one of the following sections of the Internal Revenue Code (IRC): 
• Section 267(b), which defines relationships through which taxpayers would be considered “related” for purposes 
  of the disallowance of deduction or loss on transactions between related taxpayers  
• Section 1563, relating to controlled groups of corporations, which is incorporated into section 267 by reference  
• Section 707(b), relating to partners of partnerships, which is also incorporated into section 267 by reference 

A "related entity" also includes certain real estate investment trusts (REITs) if they are not "qualified REITs." For more 
on qualified REITs, see Wisconsin Tax Bulletin #158, page 17, Questions A2 and A3. 

“Interest expenses”      –Interest that would otherwise be deductible under section 163 of the IRC and otherwise 
deductible in the computation of Wisconsin income. 

“Rent expenses”      –Gross amounts that would otherwise be deductible under the IRC, as modified for Wisconsin 
purposes, for the use of, or the right to use, real property and tangible personal property in connection with real 
property, including services rendered in connection with such property, regardless of how reported for financial ac-
counting purposes and regardless of how computed. 

“Management fees” – Expenses and costs, not including interest expenses, pertaining to accounts receivable, ac-
counts payable, employee benefit plans, insurance, legal matters, payroll, data processing, purchasing, taxation, 

IC-123 (R. 11-23) 
                                                           2

- 3 -

2023 Schedule 4V Instructions

financial matters, securities, accounting, or reporting on compliance matters or similar activities, to the extent that the
amounts would otherwise be deductible in determining net income under the IRC as modified for Wisconsin purposes.

“Intangible expenses” – Any of the following, to the extent the amounts would otherwise be deductible in determin-
ing net income under the IRC as modified for Wisconsin purposes:
• Expenses, losses, or costs for, related to, or directly or indirectly in connection with, the acquisition, use,
maintenance, management, ownership, sale, exchange, or any other disposition of intangible property
• Losses related to, or incurred in connection directly or indirectly with, factoring transactions or discounting
transactions
• Royalty, patent, technical, and copyright fees
• Licensing fees

If a corporation purchases an amortizable intangible asset from a related entity, the amortization expenses on that
asset are considered intangible expenses and should be added back.

Schedule RT Filing Requirement for Amount on Line 3. If the amount a corporation reports on line 3 of Schedule
4V exceeds $100,000, the corporation must file Schedule RT, Wisconsin Related Entity Expenses Disclosure State-
ment, with its return. However, for corporations using apportionment, you may multiply the amount on line 3 by the
apportionment percentage (Form 4, line 8) for purposes of determining whether you meet the $100,000 threshold for
filing Schedule RT.

CAUTION: Don’t forget to file Schedule RT if the amount on line 3, multiplied by the amount on Form 4, line 8, is
greater than $100,000.

■ Line 4. Actual distributions of previously taxed income– Enter the amount of income distributed this year that
was previously taxed on the federal return (e.g., Subpart F income).

■ Line 5. Expenses Related to Nontaxable Income – Enter expenses included in federal taxable income that are
directly or indirectly related to nontaxable income. Include a schedule with your return showing the payers and
amounts of nontaxable income and explaining why that income isn’t taxable.

Interest, dividends, and capital gains from the disposition of intangible assets are nontaxable if both of the following
are true:
• The operations of the payer are not unitary with those of the payee, and
• The payer and payee are not related as parent company and subsidiary or affiliates and the investment activity
from which the income is received is not an integral part of a unitary business.

Income may also be nontaxable under the principles of the U.S. Supreme Court decision in Allied-Signal v. Director,
Div. of Taxation, 504 U.S. 768 (1992), if the investment is passive and does not serve an operational function.

For corporations subject to the Wisconsin income tax rather than the franchise tax, nontaxable income also includes
interest on United States government obligations.

Examples of expenses related to nontaxable income include taxes, interest, and administrative fees related to the
production of nontaxable income.

Also enter on this line losses included in federal taxable income from disposing of assets if gains from disposing
those assets would have been nontaxable income if the assets were disposed of at a gain.

■ Line 6. Basis, Section 179, Depreciation Differences –

Difference in federal and Wisconsin basis of depreciated or amortized assets:

Enter the amount by which the federal deduction for depreciation or amortization exceeds the Wisconsin deduction
for depreciation or amortization. Include a schedule showing the computation details. These differences can happen

IC-123 (R. 11-23)
3

- 4 -

2023 Schedule 4V Instructions

because of IRC sections not adopted for Wisconsin purposes and electing a different depreciation method under the
Internal Revenue Code in effect for Wisconsin purposes. For further information about the differences between fed-
eral and Wisconsin basis and depreciation, see the section titled Conformity with Internal Revenue Code and Excep-
tions in the Form 4 instructions, as applicable.

Section 179 expenses:

For taxable years beginning on or after January 1, 2014, sections 179, 179A, 179B, 179C, 179D, and 179E of the
Internal Revenue Code, related to expensing of depreciable business assets, apply for Wisconsin tax purposes.
"Internal Revenue Code" means the federal Internal Revenue Code in effect for the year in which the property is
placed in service.

For further information about the differences between the limitations for federal and Wisconsin purposes, see the
section titled Conformity with Internal Revenue Code and Exceptions in the Form 4 instructions.

Depreciation/Amortization:

Enter the amount by which the federal deduction for depreciation or amortization exceeds the Wisconsin deduction.
Include a schedule showing the computation details.
These differences can happen because of IRC sections not adopted for Wisconsin purposes and because of
differences that existed between Wisconsin and federal law for assets placed in service before January 1, 1987.

For 2014 and beyond, bonus depreciation was reinstituted by the federal government, and an adjustment is required
to account for the depreciation difference because Wisconsin has not adopted federal bonus depreciation provisions.
For Wisconsin purposes, depreciation, depletion, and amortization is computed based on the Internal Revenue Code
in effect on January 1, 2014, and bonus depreciation was not in effect on that date.

■ Line 7. Amount by Which the Federal Basis of Assets Disposed of Exceeds the Wisconsin Basis – Enter the
amount by which the federal basis of assets disposed of exceeds the Wisconsin basis. If more than one asset is
disposed of, you may combine the bases of the assets so that you need only one entry on this line. Include a schedule
showing the computation details.

For example, assume a corporation sold the following assets during the current taxable year:

Federal Basis Wisconsin Basis Difference
Equipment $1,500 $500 $1,000
Machinery 1,000 2,000 (1,000)
Building 20,000 10,000 10,000
Totals $22,500 $12,500 $10,000

The amount to enter on Schedule 4V, line 7, would be $10,000. If the Wisconsin bases of the assets had exceeded
the federal bases, an entry would be made on Schedule 4W, line 11, instead.

The modification on line 7 may also apply in cases where a parent corporation disposes of subsidiary stock for which
the basis is determined under Treas. Reg. §1.1502-32. See sec. Tax 2.61(6)(f), Wisconsin Administrative Code, for
details.

■ Line 8. Addition for Credits Computed – Enter the total amount of credits computed from the list below if you
computed any on your 2023 return. Note: The manufacturing and agriculture credit is the credit computed in 2022.
■ Line 8a. Business development credit (Schedule BD)
■ Line 8b. Community rehabilitation program credit (Schedule CM)
■ Line 8c. Development zones credits (Schedule DC)
■ Line 8d. Economic development credit (Schedule ED)
■ Line 8e. Electronics and information technology manufacturing zone credit (Schedule EIT)

IC-123 (R. 11-23)
4

- 5 -

2023 Schedule 4V Instructions

■ Line 8f. Employee college savings account contribution credit (Schedule ES)
■ Line 8g. Enterprise zone jobs credit (Schedule EC)
■ Line 8h. Farmland preservation credit (Schedule FC or Schedule FC-A)
■ Line 8i. Jobs tax credit (Schedule JT)
■ Line 8j. Reserve for Future Use
■ Line 8k. Manufacturing and agriculture credit (2022 Schedule MA-M and MA-A)
■ Line 8l. Research credits (Schedule R)
■ Line 8m. Reserved for Future Use

■ Line 9. Special Additions for Insurance Companies – If the corporation is an insurance company, you must
complete Schedule 4I to account for addition modifications that are unique to insurance companies. Enter the total
from Schedule 4I, line 4 on Schedule 4V, line 9.

■ Line 10. Other Additions –Enter any other additions to federal income. These could include:
• Federal capital loss carryovers (if previously deducted for Wisconsin).
• Adjustments required as a result of changes made to the Internal Revenue Code which don’t apply for
Wisconsin. For Wisconsin, the Internal Revenue Code means the federal Internal Revenue Code as of
December 31, 2022, with the following exceptions.

Provisions of the Internal Revenue Code Not Adopted by Wisconsin include:

o Sections 1, 3, 4, and 5 of P.L. 106-519, which repealed foreign sales corporation provisions and replaced
with extraterritorial income provisions.
o Sections 101, 102, and 422 of P.L. 108-357, which repealed the exclusion for extraterritorial income,
domestic production activities deduction, and the creation of sec. 965 – incentives to reinvest foreign earnings
in the U.S.
o Sections 1310 and 1351 of P.L. 109-58, which provides for the modification to special rules for nuclear
decommissioning costs, repeal of the limitation on contract research expenses paid so small businesses,
universities, and federal laboratories.
o Section 11146 of P.L. 109-59, the tax treatment of state ownership of railroad real estate investment trust.
o Section 403(q) of P.L. 109-135, which provides incentives to reinvest foreign earnings from controlled foreign
corporations in the U.S.
o Section 513 of P.L.109-222, which repeals foreign sales corporation/extraterritorial income exclusion binding
contract relief.
o Section 104 of P.L. 109-432, which increases the rates of the alternative incremental credit and provides a
new alternative simplified credit.
o Sections 8233 and 8235 of P.L. 110-28, which created a special rule for banks required to change from the
reserve method of accounting in becoming tax-option (S) corporations and the elimination of all earnings and
profits attributable to pre-1983 years.
o Section 11(e) and (g) of P.L. 110-172, which provides clerical amendments to research credits for controlled
corporations and common control, and clerical amendments to the FSC Repeal and Extraterritorial Income
Exclusion Act of 2000.
o Section 301 of P.L. 110-245, which provides for tax responsibilities of expatriation.
o Section 15351 of P.L. 110-246, limits the amount of farm losses that may offset non-farming business income
to $300,000.
o Section 302 of division A, section 401 of division B, and sections 312, 322, 502(c), 707, and 801 of division
C of P.L. 110-343, which limits executive compensation for employers participating in troubled assets relief
program for the taxable year in which the troubled assets exceed $300,000,000. Caps the domestic
production activities deduction at 6% for oil-related activities. The deduction for income attributable to
domestic production activities in Puerto Rico applies to the first 8 taxable years beginning before January 1,
2010. Tax incentives for investment in the District of Columbia includes exclusion for gain on sale of an asset

IC-123 (R. 11-23)
5

- 6 -

2023 Schedule 4V Instructions

held from more than 5 years. Defines wages for purposes of the domestic production activities deduction.
Creates sec. 198A to provide for expensing of disaster expenses for control of hazardous substances.
Specifies treatment of nonqualified deferred compensation plans maintained by foreign corporations.
o Sections 1232, 1251, 1501, and 1502 of division B of P.L. 111-5, which suspends the special rules for original
issue discount on high yield obligations issued during the period 9/1/2008 and 12/31/2009. Provides that no
built-in-gain tax is imposed on a tax-option (S) Corporation for a taxable year beginning in 2009 and 2010 if
the seventh taxable year in the corporation's recognition period preceded such taxable year. Tax-exempt
obligations held by financial institutions, in an amount not to exceed 2 percent of the adjusted basis of the
financial institution's assets, are not taken into account for determining the portion of the financial institutions
interest expense subject to the pro rata interest disallowance rule of sec. 265(b). Modification of the small
insurer exception to tax-exempt interest expense allocation rules for financial institutions.
o Sections 211, 212, 213, 214, and 216 of P.L. 111-226, which adopts a matching rule to prevent the separation
of foreign taxes from the associated foreign income, denies a foreign tax credit for the disqualified portion of
any foreign income tax paid in connection with a covered asset acquisition, provides a separate application
of foreign tax credit limitation to items resourced under treaties, limits the amount of foreign taxes deemed
paid with respect to sec. 956 inclusions, treats a foreign corporation as a member of an affiliated group for
interest allocation and apportionment purposes in more than 50% of gross income is effectively connected
income and at least 80% of either the vote or value of all outstanding stock is owned directly or indirectly by
members of the affiliated group.
o Section 2122 of P.L. 111-240, which clarifies the income sourcing rules for guaranteed fees.
o Sections 754 and 760 of P.L. 111-312, which specifies certain tax incentives for investments in the District
of Columbia and specifies that gross income does not include gain on certain small business stock.
o
o Sections 104, 318, 322, 323, 326, 327, and 411 of P.L. 112-240, which makes the alternative minimum tax
exemption permanent and indexed for inflation, extends through 2013 the deduction with respect to income
attributable to domestic production activities in Puerto Rico, extends the subpart F exception for active
financing income, extends the look-thru treatment of payments between related controlled foreign
corporations under foreign personal holding company, extends through 2013 the reduction in tax-option (S)
Corporation built-in gains tax and clarifies treatment of installment sales, provides a 60% exclusion for gain
on small business stock acquired before 2019, and extends through 2013 the rules that allow gain certain
sales of electric transmission property to be recognized ratably over 8 taxable years.
o Public Law. 114-7, relating to contributions for relief of slain New York Police Detectives.
o Section 1101 of P.L. 114-74 relating to partnership rules.
o Section 305 of division P of P.L. 114-113, relating to the transportation costs of independent refiners.
o Sections 123, 125-128, 143, 144, 151-153, 165-167, 169-171, 189, 191, 326, and 411 of division Q of P.L.
114-113:
o Section 123, relating to extension of 15-year straight-line cost recovery for qualified leasehold
improvements, qualified restaurant buildings and improvements, and qualified retail improvements
o Section 125, relating to the extension of treatment of certain dividends of regulated investment
companies.
o Section 126, relating to the extension of exclusion of 100 percent of gain on certain small business stock.
o Section 127, relating to the extension of reduction in S-corporation recognition period for built-in gains
tax.
o Section 128, relating to the extension of subpart F exception for active financing income.
o Section 143, relating to the extension and modification of bonus depreciation.
o Section 144, relating to the extension of look-thru treatment of payments between related controlled
foreign corporations under foreign personal holding company rules.
o Section 151, relating to the extension and modification of exclusion from gross income of discharge of
qualified principal residence indebtedness.
o Section 152, relating to the extension of mortgage insurance premiums treated as qualified residence
interest.
o Section 153, relating to the extension of above-the-line deduction for qualified tuition and related
expenses.
o Section 165, relating to the extension of classification of certain race horses as 3-year property.

IC-123 (R. 11-23)
6

- 7 -

2023 Schedule 4V Instructions

o Section 166, relating to the extension of 7-year recovery period for motorsports entertainment complexes.
o Section 167, relating to the extension and modification of accelerated depreciation for business property
on an Indian reservation.
o Section 169, relating to the extension of special expensing rules for certain film and television
productions; special expensing for live theatrical productions.
o Section 170, relating to the extension of deduction allowable with respect to income attributable to
domestic production activities in Puerto Rico.
o Section 171, relating to the extension and modification of empowerment zone tax incentives.
o Section 189, relating to the extension of special allowance for second generation biofuel plant property.
o Section 191, relating to the extension of special rule for sales or dispositions to implement FERC or State
electric restructuring policy for qualified electric utilities.
o
o Section 326, relating to the dividends derived from RICs and REITs ineligible for deduction for United
States source portion of dividends from certain foreign corporations.
o Section 411, relating to the partnership audit rules.

o Sections 11011, 11012, 13201 (a) to (e) and (g), 13206, 13221, 13301, 13304 (a), (b), and (d), 13531, 13601,
13801, 14101, 14102, 14103, 14201, 14202, 14211, 14212, 14213, 14214, 14215, 14221, 14222, 14301,
14302, 14304, and 14401 of P.L. 115−97:
o Section 11011, relating to the 20% deduction for domestic qualified business income.
o Section 11012, relating to the limitation on losses for taxpayers other than corporations.
o Section 13201 (a) to (e) and (g), relating to the temporary 100% expensing for certain business assets
(bonus depreciation).
o Section 13206, relating to the amortization of research and experimental expenditures beginning in 2022.
o Section 13221, relating to special rules for the taxable year of inclusion.
o Section 13301, relating to the 30% taxable income limitation for the deduction of interest.
o Section 13304(a), (b), and (d) relating to the limit on the deduction by employers of fringe benefits (meals,
entertainment, and transportation).
o Section 13531, relating to the limitation on deductions for FDIC premiums.
o Section 13601, relating to the modification of the limitation on excessive employee remuneration.
o Section 13801, relating to the production period for beer, wine, and distilled spirits.
o Section 14101, relating to the deduction for the foreign-source portion of dividends received by domestic
corporations from specified 10% owned foreign corporations.
o Section 14102, relating to the special rules for sale or transfers involving specified 10% owned foreign
corporations.
o Section 14103, relating to the treatment of deferred foreign income upon transition to a participation
exemption system of taxation.
o Section 14201, relating to the current year global intangible low-taxed income by U.S. shareholders.
o Section 14202, relating to the deduction for foreign derived intangible income and global intangible low-
taxed income.
o Section 14211, relating to the elimination of the inclusion of foreign base company oil related income.
o Section 14212, relating to the repeal of the inclusion based on withdrawal of previously excluded subpart
F income from qualified investment.
o Section 14213, relating to the modification of stock attribution rules for determining the status as a
controlled foreign corporation.
o Section 14214, relating to the modification of the definition of a U.S. shareholder.
o Section 14215, relating to the elimination of the requirement that a corporation must be controlled for 30
days before the subpart F inclusions apply.
o Section 14221, relating to the limitations on income shifting through intangible property transfers.
o Section 14222, relating to certain related party amounts paid or accrued in hybrid transactions or with

IC-123 (R. 11-23)
7

- 8 -

                             2023 Schedule 4V Instructions 
 
   hybrid entities.  
  o  Section 14301, relating to the repeal of section 902 – indirect foreign tax credits, and determination of 
   the deemed paid credit for subpart F inclusions under sec. 960 on a current year basis. 
  o  Section 14302, relating to the separate foreign tax credit limitation basket for foreign branch income. 
  o  Section 14304, relating to the election to increase the percentage of domestic taxable income offset by 
   the overall domestic loss treated as foreign source. 
  o  Section 14401, relating to the base erosion anti-abuse tax.  
 o  Sections 40304, 40305, 40306, and 40412 of P.L. 115-123: 
  o  Section 40304, relating to the extension of classification of certain race horses as 3-year property. 
  o  Section  40305, relating to the  extension  of 7-year  recovery period for  motor-sports entertainment 
   complexes. 
  o  Section 40306, relating to the extension of accelerated depreciation for business property on an Indian 
   reservation. 
  o  Section 40412, relating to the extension of special allowance for second generation biofuel plant property. 
 o  Section 101 (c) of division T of P.L. 115-141, relating to the application of section 199 to certain qualified 
  payments paid after 2017 for payments received by a patron from a specified agricultural or horticultural 
  cooperative for qualified production activities income  
 o  Sections 101 (d) and (e), 102, 201 to 207, 301, 302, and 401 (a) (47) and (195), (b) (13), (17), (22) and 
  (30), and (d) (1) (D) (v), (vi), and (xiii) and (xvii) (II) of division U of P.L. 115-141: 
  o  Sections 101 (d) and (e) and 102, relating to technical corrections to bonus depreciation, alternative 
   minimum tax requirements for qualified Indian reservation property, and qualified production activities 
   income  made  by  the  Protecting  Americans  from  Tax  Hikes  Act  of  2015  and  the  Consolidated 
   Appropriations Act, 2016. 
  o  Sections 201 to 207 relating to partnership audit rules. 
  o  Sections 301 and 302, relating to amendments to regulatory requirements for partnership returns and 
   the definition of qualified small power production facilities made by the Bipartisan Budget Act of 2015 
   and the Energy Policy Act of 2005. 
  o  Section 401 (a) (47) and (195), (b) (13), (17), (22) and (30), and (d) (1) (D) (v), (vi), and (xiii) and (xvii) 
   (II), relating  to clerical corrections and  deadwood-related  provisions to the following: exempt facility 
   bonds, tax-exempt enterprise zone facility bonds, the special allowance for qualified disaster assistance 
   property, reducing the dividends received deduction where portfolio stock is debt financed, exemption 
   from tax on corporations, certain trusts, etc., requirements of domestic international sales corporations, 
   dividends received by corporations, rules applied to deductions for dividends received,  the foreign tax 
   credit, and dividends received by corporations.  
 o  Sections 104, 114, 115, 116, 130, and 145 of division Q of P.L. 116-94. 
  o  Section 104, relating to the deduction of qualified tuition and related expenses. 
  o  Section 114, relating to the classification of certain race horses as 3-year property. 
  o  Section 115, relating to the 7-year recovery period for motorsports entertainment complexes. 
  o  Section 116, relating to the accelerated depreciation for business property on Indian reservations. 
  o  Section 130, relating to special allowance for second generation biofuel plant property. 
  o  Section 145, relating to look-thru rule for related controlled foreign corporations. 
 o  Sections 2304 and 2306 of P.L. 116-136: 
  o  Section 2304, relating to the modification of limitations on losses for taxpayers other than corporations. 
  o  Section 2306, relating to the modifications of limitation on business interest. 
 o  Sections 111, 114, 115, 116, 118 (a) and (d), 133, 137, 138, and 210 of division EE of P.L. 116-260. 
  o  Section 111, relating to the look-thru rule for related controlled foreign corporations. 
  o  Section 114, relating to the exclusion from gross income of discharge of qualified principal residence 
   indebtedness. 
  o  Section 115, relating to the 7-year recovery period for motorsports entertainment complexes. 
  o  Section 116, relating to the expensing rules for certain productions. 
  o  Section 118 (a) and (d), relating to empowerment zone tax incentives. 
  o  Section 133, relating to the treatment of mortgage insurance premiums as qualified residence interest. 
  o  Section 137, relating to the classification of certain race horses as 3-year property. 
  o  Section 138, relating to the accelerated depreciation for business property on Indian reservations. 
  o  Section 210, relating to temporary allowance of full deduction for business meals. 

IC-123 (R. 11-23) 
                                            8

- 9 -

2023 Schedule 4V Instructions

• Section 5003, 9041, 9673, 9675, and 9708 of P.L. 117-2.
o Section 5003, relating to additional restaurant revitalization grant funds.
o Section 9041, relating to the excess business loss limitation extension for noncorporate taxpayers to
December 31, 2026.
o Section 9673, relating to restaurant revitalization grants not being included in gross income and
deductions allowed.
o Section 9675, relating to the exclusion from income for most student loans discharged after December
31, 2020, and before January 1, 2026.
o Section 9708, relating to the expanded definition of "covered employee" for publicly held corporations
deducting excessive employee remuneration.
Section 13903(b) of P.L. 117-169, relating to the extension of the excess business loss limitation for noncorporate
taxpayers through December 32, 2028.Changes made by the following public laws apply for Wisconsin purposes for
taxable years beginning after December 31, 2010:

• Section 1201 of P.L. 108-173, relating to health savings accounts.
• Section 307 of P.L. 109-432, relating to the exclusion from gross income of a one-time distribution from
individual retirement accounts to fund health savings accounts.

Changes made by the following public laws apply for Wisconsin purposes for taxable years beginning after
December 31, 2022:

• Sections 5001, 5002, 5005, 9623, 9624, and 9672 of P.L. 117-2
o Section 5001, relating to the addition of certain nonprofit entities and internet publishing organizations
to the list of eligible entities to receive a paycheck protection program loan.
o Section 5002, relating to additional appropriations for targeted economic injury disaster loan advances.
o Section 5005, relating to additional appropriations for shuttered venue operator grants and a reduction
in the amount of a paycheck protection program loans received.
o Section 9623, relating to allowing a married individual who files as married filing separate and lives
apart from their spouse for the last 6 months of the year or has a divorce or separation instrument with
the other spouse by the end of the tax year to claim the earned income credit.
o Section 9624, relating to permanently raising the investment income limit to $10,000, and allowing
adjustments for inflation in subsequent years for purposes of claiming the earned income credit.
o Section 9672, relating to targeted economic injury disaster loan advances received under sec. 331 of
Division N of P.L. 116-260 not being included in gross income, allowing deductions, not reducing tax
attributes, and allowing a basis increase. For partnerships and S corporations, any amount forgiven
are treated as tax-exempt for purposes of sec. 705 and 1366, IRC.
• Section 2 of P.L. 117-6, relating to the extension of paycheck protection program loan funding to June 30,
2021.
• The following sections of Division H of P.L. 117-58:
o Section 80401, relating to the addition of qualified broadband projects to the list of federally exempt
facility bonds.
o Section 80402, relating to the addition of qualified carbon dioxide capture facilities to the list of federally
exempt facility bonds.
o Section 80601, relating to including certain contributions received by a regulated public utility which
provides water or sewerage disposal services in the definition of a "contribution to the capital of the
taxpayer" for purposes of excluding the contribution from gross income of a corporation.

• Adjustments required as a result of making different elections for Wisconsin and federal purposes. See
page 8 of Wisconsin Tax Bulletin 214.
• Separately stated items of income and adjustments for differences between the federal and Wisconsin
treatment of any items of an S corporation that opts out of Wisconsin tax-option status.
• Moving expenses, as defined in s. 71.01 (8j), paid or incurred during the taxable year to move the taxpayer’s
Wisconsin business operation, in whole or in part, to a location outside the state or to move the taxpayer’s
business operations outside the United States may not be deducted as provided under the Internal Revenue
Code.

IC-123 (R. 11-23)
9

- 10 -

2023 Schedule 4V Instructions

• Entity-Level Tax Election Made by a Partnership – If the corporation is a partner in a partnership that makes
the entity level tax election, make an adjustment to remove the items of income, gain, loss, or deduction that
were included in federal taxable income before net operating loss and special deductions. If the partnership
makes the election, the box on Schedule 3K-1, Part C, box 3 will be checked. Include a copy of the Schedule
3K-1 and all supplemental schedules with your return.

CAUTION: Do not enter additions on line 10 that are specifically designated on lines 1-9 above. For example, if a
depreciation adjustment is passed through from a partnership on Schedule 3K-1, enter the amount on Schedule 4V,
line 6, not on line 10.

Additional Information and Assistance

Web Resources.

The Department of Revenue’s web page, available at revenue.wi.gov, has a number of resources to provide addi-
tional 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 in effect as of
December 1, 2023: Chapter 71 Wis. Stats., and Chapter Tax 2, Wis. Adm. Code

IC-123 (R. 11-23)
10

PDF file checksum: 3568358165

(Plugin #1/9.12/13.0)