2.60 Definitions relating to combined report-

ing. (1) PURPOSE. This section provides definitions applicable to ss. Tax 2.61, 2.62, 2.63, 2.64, 2.65, 2.66, and 2.67, which inter- pret the combined reporting provisions of s. 71.255, Stats. (2) DEFINITIONS. (a) XCombined groupY has the meaning given in s. 71.255 (1) (a), Stats. The following subdivisions clar- ify this meaning: 1. If a group of corporations satisfies all three conditions de- scribed in s. Tax 2.61 (2) (a), it is considered a combined group even if the group is not eligible to apportion its income because all corporations in the group do business solely in Wisconsin. 2. A combined group remains in existence for as long as two or more corporations meet all three conditions described in s. Tax 2.61 (2) (a) with regard to the same unitary business. The mere Published under s. 35.93, Stats. Updated on the first day of each month. Entire code is always current. The Register date on each page is the date the chapter was last published. WISCONSIN ADMINISTRATIVE CODE addition of new members or departure of existing members does not create a new combined group. 3. Any commonly controlled group that has made a con- trolled group election is a combined group, and each member of a commonly controlled group that has made the controlled group election is a combined group member. (b) XCombined group memberY means a corporation for which any part of the corporation[s net income or loss is subject to combination and therefore required to be included in a com- bined report, or any member of a commonly controlled group that is subject to a controlled group election. (c) XCombined reportY has the meaning given in s. 71.255 (1) (b), Stats. A combined report is considered a return filed pur- suant to ss. 71.24 (1) or (1m) or 71.44 (1) or (1m), Stats., as appli- cable, by each corporation included in the combined report. For this reason, the term Xcombined returnY is used throughout the rules of this chapter to refer to a combined report. (d) XCombined returnY has the same meaning as Xcombined reportY as explained in par. (c). In general, a combined return in- cludes the computation of combined unitary income, the appor- tionment of the income to each combined group member, as ap- plicable, any separate entity items, loss carryforwards, and cred- its of each combined group member, and the net tax and eco- nomic development surcharge liability of each combined group member. To be considered complete, a combined return shall contain all the items required in s. Tax 2.67 (2) (c). (e) XCombined unitary incomeY means the combined group[s net income or loss attributable to the unitary business which is subject to combination under s. 71.255, Stats., before apportion- ment and net business loss carryforwards. Combined unitary in- come excludes any amounts that are not subject to combination because of the water[s edge rules. (f) XControlled group electionY means an election to include every member of the commonly controlled group in the com- bined group as provided by s. 71.255 (2m), Stats., and further de- scribed in s. Tax 2.63. (g) XCorporationY includes corporations, publicly traded part- nerships treated as corporations in section 7704 of the Internal Revenue Code, limited liability corporations treated as corpora- tions under the Internal Revenue Code, joint stock companies, as- sociations, common law trusts and all other entities treated as corporations under section 7701 of the Internal Revenue Code, unless the context requires otherwise in this chapter or in ch. 71, Stats. (h) XDesignated agentY means the corporation in the com- bined group responsible for acting on behalf of the group for mat- ters relating to the combined return, as further described in s. Tax 2.65. (i) XIncomeY and Xnet incomeY include net losses, unless the context requires otherwise. (j) XIntercompany transactionY means a transaction between two members of the same combined group. (k) XInternal Revenue CodeY has the meaning given in ss. 71.22 (4) and (4m) and 71.42 (2), Stats., as applicable. (L) XNonincludable corporationY means a corporation that is not required to use combined reporting even if it satisfies all three conditions described in s. Tax 2.61 (2) (a). A nonincludable cor- poration cannot be a combined group member even if the nonin- cludable corporation is a member of a commonly controlled group which has made the controlled group election. (Lm) XPre-2009 net business loss carryforwardY has the meaning given to Xpre-2009 net business loss carry-forwardY in s. 71.255 (6) (bm) 1., Stats. (m) XSeparate entity itemY means a combined group mem- ber[s item of net income or loss or apportionment factor amount which is not subject to combination but instead must be ac- counted for on a separate entity basis. Separate entity items may include those listed in s. Tax 2.61 (5) (b) to (g). Net business loss carryforwards may be separate entity items if they are non- sharable loss carryforwards as provided in s. Tax 2.61 (9). (n) XStateY means a state of the United States, the District of Columbia, the commonwealth of Puerto Rico, or any territory or possession of the United States. (o) XUnitary business incomeY means the net income or loss derived from the unitary business, whether or not the income or loss is subject to combination. XUnitary businessY is explained further in s. Tax 2.62. (p) XUnitary combinationY means the computation of com- bined unitary income and of each member[s share of the com- bined unitary income. (q) XWater[s edge rulesY means the rules provided under s. Tax 2.61 (4) under which some or all of a corporation[s items at- tributable to a unitary business are not subject to combination be- cause of the degree of the corporation[s activity outside the United States. Note: Section Tax 2.60 interprets s. 71.255, Stats. History: EmR1001: emerg. cr. eff. 1-15-10; CR 09-064: cr. Register April 2010 No. 652, eff. 5-1-10; CR 12-006: cr. (2) (Lm) Register July 2012 No. 679, eff. 8-1- 12; CR 12-011: am. 2.60 (2) (d) Register July 2012 No. 679, eff. 8-1-12.