State of Wisconsin
Department of Revenue
Filing Claims
for Refund of
Sales or Use Tax
Includes information on:
• Who may file claims for refund
• Which form to use
• Time limitations for filing
• Interest
• Penalties
Publication 216 (10/12)
Printed on
Recycled Paper
Important Rate Changes!
BEGINNING JANUARY 1, 2024:
o Milwaukee County sales and use tax rate increases
from 0.5% to 0.9%
o City of Milwaukee imposes a new 2% sales and use tax
o See Fact Sheet 2414 Milwaukee Sales and Use Taxes
See the Sales Tax Rate Chart for a complete list of county
sales and use tax rates and their effective dates
Table of Contents
PAGE
I. INTRODUCTION................................................................................................................................1
II. WHICH SALES ARE SUBJECT TO SALES AND USE TAXES?.................................................1
III. WHO MAY FILE CLAIMS FOR REFUND? ...................................................................................1
A. Sellers ...............................................................................................................................................1
B. Buyers ..............................................................................................................................................2
I V. HOW TO FILE A CLAIM ..................................................................................................................3
A. Sellers ...............................................................................................................................................3
B. Buyers ..............................................................................................................................................3
V. TIME LIMITATIONS FOR FILING ................................................................................................4
A. Sellers ...............................................................................................................................................5
B. Buyers ..............................................................................................................................................7
VI. INTEREST .........................................................................................................................................10
A. Refunded to Seller..........................................................................................................................10
B. Refunded to Buyer .........................................................................................................................10
VII. OTHER ............................................................................................................................................... 11
A. Buyer and Seller May Not Both Obtain Refunds of Tax ............................................................... 11
B. Offsetting a Refund Against Any Debts ......................................................................................... 11
C. Department of Revenue to Act on Claim ....................................................................................... 11
D. Seller to Refund Tax and Interest to Buyers or the Department of Revenue ................................. 11
VIII. PENALTIES .......................................................................................................................................12
A. Incorrect Claim for Refund ............................................................................................................12
B. Failure to Return Tax to Buyer or Department ..............................................................................12
C. Failure to Produce Records ............................................................................................................12
IX. SPECIAL SITUATIONS NOT REQUIRING THE SELLER TO FILE A CLAIM FOR
REFUND .............................................................................................................................................12
A. Sale Returns and Price Adjustments ..............................................................................................12
B. Bad Debts .......................................................................................................................................13
C. Tax Paid on Purchase of Leased Property ......................................................................................14
D. Tax-Paid Purchases Resold ............................................................................................................14
X. IF YOU HAVE QUESTIONS............................................................................................................14
APPENDIX
Form S-220, Form BCR, Buyer's Claim for Refund of Wisconsin State, County and
Stadium Sales Taxes
Form S-220a, Schedule P, Attachment to Form BCR, Buyer's Claim for Refund of Wisconsin
State, County and Stadium Sales Taxes
Filing Claims for Refund of Sales or Use Tax
1
I. INTRODUCTION
This publication explains who may file a claim for re-
fund of Wisconsin state, county, and stadium sales or
use tax. It also includes information relating to forms,
time limitations for filing, interest, and penalties.
CAUTION
The information in this publication reflects the po-
sitions of the Wisconsin Department of Revenue of
laws enacted by the Wisconsin Legislature and in
effect as of October 1, 2012. Laws enacted and in
effect after that date, new administrative rules, and
court decisions may change the interpretations in
this publication.
For purposes of this publication, the following defini-
tions apply:
“Seller” means a person selling, licensing, leasing, or
renting the property, items, or goods listed in Part II.A.,
B., C., and D., or selling, performing, or furnishing ser-
vices. Note: In certain situations, the term may include
a certified service provider when acting on behalf of a
seller with respect to the seller’s sales and use tax func-
tions.
“Buyer” means a person who acquires possession, own-
ership, title, enjoyment, or use the property, items, or
goods listed in Parts II.A., B., C., and D. or services for
a consideration.
A person may be a buyer in some transactions and a
seller in other transactions.
“Claim for refund,” as used in this publication, refers to
a written request for a refund of sales or use taxes by a
buyer or seller pursuant to secs. 77.59(4) or (8m), Wis.
Stats. (2009-10).
Note: In certain situations, a seller is allowed to make
adjustments to their current sales and use tax return ra-
ther than file a claim for refund for sales and use taxes
paid with returns previously filed. See Part IX. on
page 12 for additional information.
II. WHICH SALES ARE SUBJECT TO
SALES AND USE TAXES?
Sales, licenses, leases, and rentals of the following
property, items, and goods are subject to the 5% Wis-
consin state sales tax, unless an exemption applies:
A. Tangible personal property;
B. Coins or stamps of the United States that are sold,
licensed, leased, rented, or traded as collector’s
items above their face value;
C. Leased tangible personal property that is affixed to
real property, if the lessor has the right to remove
the leased property upon breach or termination of
the lease agreement, unless the lessor of the leased
property is also the lessor of the real property to
which the leased property is affixed.
D. Specified digital goods, additional digital goods,
and digital codes. These digital goods are character-
ized by the fact that they are transferred
electronically to the purchaser (i.e., accessed or ob-
tained by the purchaser by means other than
tangible storage media). “Specified digital goods”
means “digital audio works,” “digital audiovisual
works,” and “digital books.” “Additional digital
goods” means greeting cards, finished artwork, pe-
riodicals, video or electronic games, and
newspapers or other news or information products.
See Publication 240 for a description of the prod-
ucts that are included.
In addition, certain services are subject to the 5%
Wisconsin state sales tax. For a list of taxable ser-
vices, see Part X.B. of Publication 201.
III. WHO MAY FILE CLAIMS FOR
REFUND?
A. Sellers
A seller who paid sales or use taxes in error to the De-
partment of Revenue may file a claim for refund.
Caution: If a seller is refunded tax and interest by
the Department of Revenue for tax collected from a
buyer, the seller must return the tax and interest to
the buyer or to the Department of Revenue within
Publication 216
2
90 days after the date of the refund or offset. Fail-
ure to return the tax and related interest to the
buyer or the Department of Revenue within the 90
day period results in a penalty of 25% of the
amount not returned, or may result in a penalty of
100% if due to fraud.
B. Buyers
1. Tax Paid to Department of Revenue
A buyer may file a claim for refund of use tax
the buyer paid in error to the Department of
Revenue.
Example: A manufacturer (buyer) purchased
equipment for $50,000 from an out-of-state
seller. The seller did not charge sales tax to the
buyer on the equipment.
On a consumer use tax return, the buyer report-
ed and paid $2,500 of use tax to the Department
of Revenue on the equipment. At a later date,
the buyer realized that its purchase of the
equipment qualified for exemption from sales
and use tax since it is used exclusively and di-
rectly by the buyer in manufacturing.
The manufacturer (buyer) may file a claim for
refund with the Department of Revenue for the
$2,500 of use tax paid in error to the Depart-
ment of Revenue.
2. Tax Paid to a Seller
A buyer may file a claim for refund of sales and
use tax paid in error to a seller under any of the
following four conditions:
a. The claim for refund totals $50 or more of
tax.
“$50 or more of tax” means that the total
tax relating to all transactions contained in
the claim for refund filed with the Depart-
ment of Revenue is $50 or more.
Example: Buyer A erroneously paid $40 of
sales tax to Seller B and $30 of sales tax to
Seller C. Buyer A may file a claim for re-
fund with the Department of Revenue for
the $70 of overpaid sales tax.
Important: For conditions (b), (c), and (d)
below, the $50 requirement [as in condition
(a) above] does not apply.
b. Seller has ceased operating business.
If at the time of filing the claim the seller
has ceased business, the buyer may file a
claim for refund with the Department of
Revenue.
Example: Buyer D erroneously paid $45 of
sales tax to Seller E in January 2009. In
April 2011, Seller E terminated the busi-
ness. Buyer D may file a claim for refund
with the Department of Revenue for the
$45 of overpaid sales tax.
If the buyer also paid sales or use tax in er-
ror to sellers who have not ceased business,
only the seller may file a claim for refund
with the Department of Revenue for such
tax, unless the buyer meets one of the other
conditions described in (a), (c), or (d).
c. Buyer is being field audited.
If a buyer being field audited by the De-
partment of Revenue paid sales or use tax
in error to sellers or to the Department of
Revenue, the buyer may file a claim for re-
fund with the Department of Revenue.
Example: Buyer F is being field audited for
the period of January 2007 through Decem-
ber 2010. Buyer F erroneously paid $1,000
of sales tax to Seller G in November 2009.
While Buyer F is being field audited, Buy-
er F may file a claim for refund for the
$1,000 of sales tax erroneously paid in No-
vember 2009. The auditor will include this
overpayment in the audit determination, if
the claim is filed in advance of the pro-
posed audit report.
d. Periods covered in the claim for refund are
within the statute of limitations for buyer,
but are closed to seller.
Filing Claims for Refund of Sales or Use Tax
3
Example: In August 2012, Buyer H discov-
ers that it erroneously paid sales tax to
Seller I in July 2007. Seller I reported the
sales tax on its July 2007 sales and use tax
return and paid the tax to the Department of
Revenue in August 2007.
Buyer H files its Wisconsin corporate fran-
chise tax return on a fiscal year basis, with
its fiscal year ending June 30. Seller I files
its Wisconsin corporate franchise tax return
on a calendar year basis.
The statutory deadline for Seller I to file a
claim expired on March 15, 2012, which is
four years from the unextended due date
(that is, March 15, 2008) of its corporate
franchise tax return for the calendar year
2007.
Buyer H may file a claim for refund of tax
it paid to Seller I in July 2007. Buyer H
must file this claim by September 17, 2012,
which is four years from the unextended
due date (that is, September 15, 2008) of
Buyer H’s 2007 corporate franchise tax re-
turn. Note: September 15, 2012 falls on a
Saturday. The due date is the next business
day.
Note: If the buyer also paid sales or use tax
to sellers in error which pertains to a period
which is within the statute of limitations for
both the buyer and seller, only the seller
may file a claim for refund with the De-
partment of Revenue for such tax, unless
the buyer meets one of the other conditions
described in (a), (b), or (c).
IV. HOW TO FILE A CLAIM
A. Sellers
1. My Tax Account
Sellers may claim a refund of sales and use
taxes paid to the Department by amending a previ-
ously filed return using My Tax Account. See
Amend a Return, using the following link:
revenue.wi.gov/Pages/FAQS/mta-using-
mta.aspx#filing for additional information.
2. Form ST-12
Sellers claiming a refund of sales or use tax paid
to the Department of Revenue may use a paper
Form ST-12, Wisconsin Sales and Use Tax Return,
as an amended return. Form ST-12 and instructions
are available from any Department of Revenue
office, or online, at: revenue.wi.gov. Refer to
page 6 of the instructions for Form ST-12 for more
information on how to use Form ST-12 as an
amended return to file a claim for refund. Paper
amended returns should be sent to: Wisconsin
Department of Revenue, P. O. Box 8921, Madison,
WI 53708-8921.
3. Alternative Written Option
In lieu of an amended return, a seller may file a
claim for refund by sending a letter to the Depart-
ment of Revenue. Claims submitted in this manner
must indicate the claimant’s name and address, sell-
er’s tax account number, amount of the claim,
reporting period for which the overpayment was
made, and a reason for the claim. A chronological
listing of all invoices included in the claim and cop-
ies of applicable exemption certificates received
from buyers should be attached to the letter. Claims
for refund filed in this manner should be submitted
to: Wisconsin Department of Revenue, Mail Stop
5-144, P.O. Box 8906, Madison, WI 53708-8906.
Note: The Department will not accept refund
claims made via email or over the telephone.
B. Buyers
1. Tax Paid to a Seller:
Buyers that overpaid sales or use tax to a seller
can file a claim for refund using one of the fol-
lowing three methods:
• If you have filed a buyer's claim for refund
in the past – Use My Tax Account.
• If you have not filed a buyer's claim for re-
fund before, file electronically. Select File a
buyer's claim for refund – sales tax.
• Use paper Form S-220, Buyer’s Claim for
Refund of Wisconsin State, County, and
Stadium Sales Taxes, (also known as
Form BCR). Form S-220a, Schedule P,
Publication 216
4
Attachment to Buyer’s Claim for Refund of
Wisconsin State, County, and Stadium Sales
Taxes, must be completed and attached to
Form S-220 for each seller to whom the
buyer paid sales or use tax in error.
Forms are available at revenue.wi.gov or
from any Department of Revenue office.
See Forms S-220 and S-220a at the end of
this publication for copies of these forms.
2. Tax Paid to Department of Revenue:
Buyers claiming a refund of use tax paid direct-
ly to the Department of Revenue may use
Form ST-12.
Refer to page 6 of the instructions for
Form ST-12, available from any Department of
Revenue office or online at revenue.wi.gov, for
more information on how to use Form ST-12 as
an amended return to file a claim for refund.
Amended returns may be submitted using My
Tax Account or sent to: Wisconsin Department
of Revenue, P. O. Box 8921, Madison, WI
53708-8921.
In lieu of Form ST-12, a buyer may file a claim
for refund by sending a letter to the Department
of Revenue. The letter must indicate the claim-
ant’s name and address, tax account number,
amount of the claim, reporting period for which
the overpayment was made, and reason for the
claim. A chronological listing of all invoices in-
cluded in the claim should be attached to the
letter. Claims for refund submitted in this mat-
ter should be submitted to: Wisconsin
Department of Revenue, Mail Stop 5-144, P. O.
Box 8906, Madison, WI 53708-8906.
3. Tax Paid to Another State Agency:
Buyers claiming a refund of use tax paid to an-
other state agency, such as the Department of
Transportation (DOT) or the Department of
Natural Resources (DNR), must submit their
request directly to: Wisconsin Department of
Revenue, Mail Stop 5-144, P. O. Box 8906,
Madison, WI 53708-8906
Note: This applies to situations where the buyer
is required to pay use tax to the agency prior to
registering or titling property such as a motor
vehicle, boat, snowmobile, mobile home not
exceeding 45 feet in length, trailer, semitrailer,
all-terrain vehicle or aircraft in Wisconsin.
In situations where the buyer paid sales tax to a
state agency as the retailer of the property or
taxable service purchased, the buyer should fol-
low the procedure under B.1. of this Part IV.
The written request should include the follow-
ing:
• A description of the transaction and reason
for the refund;
• A copy of the application that the buyer
originally completed (for example, a
Form MV1, Wisconsin Title & License
Plate Application); and
• A copy of the cancelled check (if available).
Example: Buyer X purchased an automo-
bile from a private party. When registering
the automobile with DOT, Buyer X over-
paid the use tax by $200. Buyer X may
request a refund of the overpayment in tax
from the Department of Revenue by send-
ing a written request, including an
explanation, a copy of the original
Form MV1, and the cancelled check verify-
ing payment.
V. TIME LIMITATIONS FOR FILING
A claim for refund of a buyer or seller is timely filed if
it is either:
• received in person by a Department of Revenue
employee on or before the due date, or
• mailed (including the delivery by a delivery service
designated under sec. 7502(f) of the Internal Reve-
nue Code) (1) in a properly addressed envelope,
with postage duly prepaid, (2) the envelope is
postmarked, or marked or recorded electronically as
provided under sec. 7502(f)(2)(c) of the IRC, before
midnight of the last day of the limitation period, and
(3) the claim is actually received by the Department
Filing Claims for Refund of Sales or Use Tax
5
of Revenue within five days after the last day of the
limitation period.
Note: For purposes of this publication, a “determina-
tion” means the net result (that is, refund or tax due) of
a Department of Revenue audit. For example, the De-
partment of Revenue may audit a claim for refund and
find additional tax and interest due on unreported pur-
chases of tangible personal property. If the refund
claimed, including interest, is greater than the amount
of tax and interest due, the net result is a refund. The
taxpayer may file a claim for refund regarding the tax
paid (that is, assessed during audit and offset against
refund) within two years of that refund determination,
as long as the taxpayer did not file of petition for rede-
termination.
A. Sellers
As indicated in Parts V.A.1. to 4. on pages 5-7, the
time limitations for a seller to file a claim for refund
of sales or use tax depend on whether the seller was
audited by the Department of Revenue for the peri-
od of the claim.
1. Claims for Refund — No Office Audit Deter-
mination Was Made for the Transaction and
No Field Audit Determination Was Made for
Period of the Claim
If the transaction in the claim for refund (1) was
not included in a prior office audit determina-
tion and (2) was not in the periods or years
included in a prior field audit determination
(neither (1) nor (2) occurred), claims for refund
may be filed as follows:
• Within four years after the unextended due
date of the seller’s Wisconsin income or
franchise tax return, or,
• If exempt from filing Wisconsin income or
franchise tax returns, within four years of
the 15th day of the 4th month of the year
following the close of the calendar or fiscal
year.
Example: Seller J, an individual, overpaid
sales tax to the Department of Revenue on
her January 2008 sales and use tax return.
The unextended due date of Seller J’s 2008
income tax return is April 15, 2009.
Seller J has until April 15, 2013 to file a
claim for refund for the overpaid sales tax
reported on her January 2008 sales and use
tax return.
2. Claims for Refund — Office Audit Determina-
tion Was Made for the Transaction
Claims for refund of the tax assessed by an of-
fice audit may be filed within two years of the
issuance of the notice of determination of sales
or use tax assessed by office audit, if the seller
paid the tax and the tax was not protested by fil-
ing a petition for redetermination.
Example: In an office audit determination dated
and issued July 15, 2011, the Department of
Revenue assessed Seller K $800 of sales tax on
equipment Seller K sold to Buyer L in June
2009. Seller K paid the $800 of sales tax on Ju-
ly 29, 2011, and did not file a petition for
redetermination.
In January 2012, Buyer L provides Seller K
with an exemption certificate, claiming the
manufacturing exemption on the equipment.
Seller K has until July 15, 2013 (two years from
the date the notice of office audit determination
was issued) to file a claim for refund with the
Department of Revenue for the $800 of tax,
since the overpaid tax was part of the July 15,
2011 office audit determination.
3. Claims for Refund — Field Audit Determina-
tion Was Made for Period of Claim
If the transaction occurred during the period or
years included in a prior field audit determina-
tion, the time limitations for filing a claim for
refund for such transaction are as follows:
a. Transaction Not Assessed in Field Audit
Determination
1) Field Audit Not Appealed to Depart-
ment’s Resolution Unit
Seller has until the earliest of the fol-
lowing to file a claim for refund:
Publication 216
6
• Four years from the unextended
due date of the seller’s income or
franchise tax return or if exempt
from filing Wisconsin income or
franchise tax returns, within four
years of the 15th day of the 4th
month of the year following the
close of the calendar or fiscal year
(or date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
• Date the amount of the notice of
determination is paid.
• 60 days after the date the seller re-
ceived the notice of determination.
2) Field Audit Determination Appealed to
the Department’s Resolution Unit, But
Not to Wisconsin Tax Appeals Commis-
sion
Seller has until the earliest of the fol-
lowing to file a claim for refund:
• Four years from the unextended
due date of the seller’s income or
franchise tax return or if exempt
from filing Wisconsin income or
franchise tax returns, within four
years of the 15th day of the 4th
month of the year following the
close of the calendar or fiscal year
(or date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
• Date the amount of the notice of
determination is paid (this does not
include deposits of tax under
sec. 77.59(6)(c), Wis. Stats., while
appeal is pending).
• 60 days after the date the seller re-
ceived the Resolution Unit’s notice
of redetermination.
3) Seller Appeals Field Audit Determina-
tion to Wisconsin Tax Appeals
Commission or Court
Seller has until the earliest of the fol-
lowing to file a claim for refund:
• Four years from the unextended
due date of the seller’s income or
franchise tax return or if exempt
from filing Wisconsin income or
franchise tax returns, within four
years of the 15th day of the 4th
month of the year following the
close of the calendar or fiscal year
(or date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
• Date the amount of the notice of
determination is paid (this does not
include deposits of tax under
sec. 77.59(6)(c), Wis. Stats., while
appeal is pending).
• 60 days after the date the seller re-
ceived the Resolution Unit’s notice
of redetermination, even though
seller files the appeal with the Wis-
consin Tax Appeals Commission
before the 60 days have expired.
b. Transaction Assessed in Field Audit De-
termination
Claims for refund of the tax assessed by a
field audit may be filed within two years of
the issuance of the notice of determination
of sales or use tax assessed by field audit, if
the seller paid the tax and the tax was not
protested by filing a petition for redetermi-
nation.
Example: Seller O is field audited by the
Department of Revenue for the period Jan-
uary 2008 through December 2011, and is
assessed $5,000 of sales tax on sales made
by Seller O. The notice of determination is
dated and issued April 6, 2012.
Seller O pays the $5,000 of sales tax on
April 20, 2012, and does not file a petition
for redetermination.
Seller O has until April 7, 2014, to file a
claim for refund with the Department of
Revenue for all or part of the $5,000 of
sales tax assessed. (April 6, 2014, falls on a
Sunday. The due date is the following busi-
ness day.)
Filing Claims for Refund of Sales or Use Tax
7
4. Claims for Refund — A Field Audit Determi-
nation Was Made and Customer Files Valid
Claim With Seller
Even though a seller has been field audited,
claims for refund may be filed within four years
after the unextended due date of the seller’s
Wisconsin income or franchise tax return, or if
exempt from filing Wisconsin income or fran-
chise tax returns, within four years of the 15th
day of the 4th month of the year following the
close of the calendar or fiscal year, if the sell-
er’s customers have filed valid claims for
refund with the seller.
Example: Seller Q, a sole proprietor, is field
audited by the Department of Revenue for the
period January 2006 through December 2009.
Seller Q is assessed $2,000 of use tax on
equipment purchased by Seller Q from vendors
located outside Wisconsin. The notice of field
audit determination is dated and issued June 11,
2010. Seller Q does not file a petition for rede-
termination.
Seller Q files its income tax return on a calen-
dar year basis.
In November 2011, Seller Q receives a request
from a church for a refund of $500 of sales tax
which it charged to the church on landscaping
services provided by Seller Q in July 2008. The
church has provided Seller Q with its certificate
of exempt status number. Seller Q reported the
$500 of tax on its July 2008 sales and use tax
return.
Since Seller Q reported the $500 of tax on its
July 2008 sales and use tax return, Seller Q has
until April 15, 2013 (four years from the unex-
tended due date of his 2008 income tax return),
to file a refund claim with the Department of
Revenue for the $500 of sales tax.
B. Buyers
As indicated in this Part V.B. on pages 7-10, the
time limitations for a buyer to file a claim for re-
fund of sales or use tax depend on whether the
buyer was audited by the Department of Revenue
for the period of the claim.
Tax Paid to the Department of Revenue:
1. Claims for Refund — No Office Audit Deter-
mination Was Made for the Transaction and
No Field Audit Determination Was Made for
Period of the Claim
If the transaction in the claim for refund (1) was
not included in a prior office audit determina-
tion and (2) was not in the periods or years
included in a prior field audit determination
(neither (1) nor (2) occurred), claims for refund
may be filed as follows:
• Within four years after the unextended due
date of the buyer’s Wisconsin income or
franchise tax return, or,
• If exempt from filing Wisconsin income or
franchise tax returns, within four years of
the 15th day of the 4th month of the year
following the close of the calendar or fiscal
year (or date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
Example: Buyer J, an individual, overpaid
use tax to the Department of Revenue on
his January 2008 sales and use tax return.
The unextended due date of Buyer J’s 2008
income tax return is April 15, 2009.
Buyer J has until April 15, 2013 to file a
claim for refund for the overpaid use tax
reported on the January 2008 sales and use
tax return.
2. Claims for Refund — Office Audit Determina-
tion Was Made for the Transaction
Claims for refund of the tax assessed by an of-
fice audit may be filed within two years of the
issuance of the notice of determination of sales
or use tax assessed by office audit, if the buyer
paid the tax and the tax was not protested by fil-
ing a petition for redetermination.
Example: In an office audit determination dated
and issued July 22, 2011, the Department of
Revenue assessed Buyer K $800 of use tax on
equipment Buyer K purchased in June 2009.
Buyer K paid the $800 of use tax on July 29,
Publication 216
8
2011, and did not file a petition for redetermi-
nation.
Buyer K has until July 22, 2013, (two years
from the date the notice of office audit determi-
nation was issued) to file a claim for refund
with the Department of Revenue for the $800 of
tax, since the tax was part of the July 22, 2011
office audit determination.
3. Claims for Refund — Field Audit Determina-
tion Was Made for Period of Claim
If the transaction occurred during the period or
years included in a prior field audit determina-
tion, the time limitations for filing a claim for
refund for such transaction are as follows:
a. Transaction Not Assessed in Field Audit
Determination
1) Field Audit Not Appealed to Depart-
ment’s Resolution Unit
Buyer has until the earliest of the fol-
lowing to file a claim for refund:
• Four years from the unextended
due date of the buyer’s income or
franchise tax return or if exempt
from filing Wisconsin income or
franchise tax returns, within four
years of the 15th day of the 4th
month of the year following the
close of the calendar or fiscal year
(or date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
• Date the amount of the notice of
determination is paid.
• 60 days after the date the buyer re-
ceived the notice of determination.
2) Field Audit Determination Appealed to
the Department’s Resolution Unit, But
Not to Wisconsin Tax Appeals Commis-
sion
Buyer has until the earliest of the fol-
lowing to file a claim for refund:
• Four years from the unextended
due date of the buyer’s income or
franchise tax return or if exempt
from filing Wisconsin income or
franchise tax returns, within four
years of the 15th day of the 4th
month of the year following the
close of the calendar or fiscal year
(or date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
• Date the amount of the notice of
determination is paid (this does not
include deposits of tax under
sec. 77.59(6)(c), Wis. Stats., while
appeal is pending).
• 60 days after the date the buyer re-
ceived the Resolution Unit’s notice
of redetermination.
3) Buyer Appeals Field Audit Determina-
tion to Wisconsin Tax Appeals
Commission or Court
Buyer has until the earliest of the fol-
lowing to file a claim for refund:
• Four years from the unextended
due date of the buyer’s income or
franchise tax return or if exempt
from filing Wisconsin income or
franchise tax returns, within four
years of the 15th day of the 4th
month of the year following the
close of the calendar or fiscal year
(or date extended by waiver under
sec. 77.59(3m), Wis. Stats).
• Date the amount of the notice of
determination is paid (this does not
include deposits of tax under
sec. 77.59(6)(c), Wis. Stats., while
appeal is pending).
• 60 days after the date the buyer re-
ceived the Resolution Unit’s notice
of redetermination, even though the
buyer files the appeal with the Wis-
consin Tax Appeals Commission
before the 60 days have expired.
Filing Claims for Refund of Sales or Use Tax
9
b. Transaction Assessed in Field Audit De-
termination
Claims for refund of the tax assessed by a
field audit may be filed within two years of
the issuance of the notice of determination
of sales or use tax assessed by field audit, if
the buyer paid the tax and the tax was not
protested by filing a petition for redetermi-
nation.
Example: Buyer O is field audited by the
Department of Revenue for the period Jan-
uary 2007 through December 2010, and is
assessed $5,000 of use tax on purchases
made. The notice of determination is dated
and issued October 7, 2011.
Buyer O pays the $5,000 of use tax on Oc-
tober 28, 2011, and does not file a petition
for redetermination.
Buyer O has until October 7, 2013, to file a
claim for refund with the Department of
Revenue for all or part of the $5,000 of use
tax assessed.
Tax Paid to Seller:
1. Claims for Refund — No Field Audit Deter-
mination Was Made for Period of the Claim
If the transaction in the claim for refund was
not in the periods or years included in a prior
field audit determination, claims for refund may
be filed as follows:
• Within four years after the unextended due
date of the buyer’s Wisconsin income or
franchise tax return, or if exempt from fil-
ing Wisconsin income or franchise tax
returns, within four years of the 15th day of
the 4th month of the year following the
close of the calendar or fiscal year (or date
extended by waiver under sec. 77.59(3m),
Wis. Stats.).
Example: Buyer J, an individual, overpaid
sales tax of $100 to Seller K in January
2009. The unextended due date of Buyer J’s
2009 income tax return is April 15, 2010.
Buyer J has until April 15, 2014 to file a
claim for refund for the overpaid sales tax
paid to Seller K in January 2009.
2. Claims for Refund — Field Audit Determina-
tion Was Made for Period of Claim
If the transaction occurred during the period or
years included in a prior field audit determina-
tion, the time limitations for filing a claim for
refund for such transaction are as follows:
a. Field Audit Not Appealed to Depart-
ment’s Resolution Unit
Buyer has until the earliest of the following
to file a claim for refund:
• Four years from the unextended due
date of the buyer’s income or franchise
tax return or if exempt from filing Wis-
consin income or franchise tax returns,
within four years of the 15th day of the
4th month of the year following the
close of the calendar or fiscal year (or
date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
• Date the amount of the notice of deter-
mination is paid.
• 60 days after the date the buyer re-
ceived the notice of determination.
b. Field Audit Determination Appealed to
the Department’s Resolution Unit, But
Not to Wisconsin Tax Appeals Commis-
sion
Buyer has until the earliest of the following
to file a claim for refund:
• Four years from the unextended due
date of the buyer’s income or franchise
tax return or if exempt from filing Wis-
consin income or franchise tax returns,
within four years of the 15th day of the
4th month of the year following the
close of the calendar or fiscal year (or
date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
• Date the amount of the notice of deter-
mination is paid (this does not include
Publication 216
10
deposits of tax under sec. 77.59(6)(c),
Wis. Stats., while appeal is pending).
• 60 days after the date the buyer re-
ceived the Resolution Unit’s notice of
redetermination.
c. Buyer Appeals Field Audit Determina-
tion to Wisconsin Tax Appeals
Commission or Court
Buyer has until the earliest of the following
to file a claim for refund:
• Four years from the unextended due
date of the buyer’s income or franchise
tax return or if exempt from filing Wis-
consin income or franchise tax returns,
within four years of the 15th day of the
4th month of the year following the
close of the calendar or fiscal year (or
date extended by waiver under
sec. 77.59(3m), Wis. Stats.).
• Date the amount of the notice of deter-
mination is paid (this does not include
deposits of tax under sec. 77.59(6)(c),
Wis. Stats., while appeal is pending).
• 60 days after the date the buyer re-
ceived the Resolution Unit’s notice of
redetermination, even though the buyer
files the appeal with the Wisconsin Tax
Appeals Commission before the
60 days have expired.
VI. INTEREST
When sales or use tax is refunded, interest at 9% per
year is paid with the refund, computed as follows:
A. Refunded to Seller
The period for which interest is computed begins on
the unextended due date of the seller’s sales and use
tax return for the period in which the sale was
made, and ends on the date the refund is paid.
Example: On July 15, 2011, Seller U files its June
2011 sales and use tax return, and pays the tax due
of $500 reported on the return. The unextended due
date of Seller U’s June 2011 sales and use tax return
is July 31, 2011.
Subsequently, Seller U determines that it overre-
ported its gross receipts on its June 2011 sales and
use tax return, resulting in a $100 overpayment of
sales tax.
On August 22, 2013, Seller U files a claim for re-
fund for the $100 of overpaid sales tax. The
Department of Revenue pays the refund to Seller U
on October 31, 2013.
The period for which interest is computed is Ju-
ly 31, 2011 to October 31, 2013 (27 months). The
interest portion of the refund is computed as fol-
lows:
27 months
x .09 x $100 = $20.25
12 months
B. Refunded to Buyer
1. Tax Paid to Department — The period for
which interest is computed begins on the unex-
tended due date of the buyer’s sales and use tax
return (or the buyer’s consumer use tax return)
for the period in which the purchase was made,
and ends on the date the refund is paid.
Example: On January 22, 2010, Buyer V files
its December 2009 sales and use tax return. The
unextended due date of Buyer V’s December
2009 sales and use tax return is January 31,
2010.
Subsequently, Buyer V determines that it over-
paid its use tax by $500 and files a claim for
refund with the Wisconsin Department of Rev-
enue for the $500 of overpaid use tax. The
Department of Revenue pays the refund to
Buyer V on October 1, 2010.
The period for which interest is computed is
January 31, 2010 to October 1, 2010 (eight
months). The interest portion of the refund is
computed as follows:
8 months
x .09 x $500 = $30.00
12 months
2. Tax Paid to Seller — Interest is computed
from the last day of the month following the
Filing Claims for Refund of Sales or Use Tax
11
month in which the tax was paid by the buyer to
the seller, to the date the refund is paid.
Example: On September 15, 2009, Buyer W
pays $1,000 of sales tax to Seller X on a pur-
chase of equipment.
Subsequently, Buyer W determines that the
equipment purchased qualifies for exemption
from sales and use tax. On December 10, 2009,
Buyer W files a claim for refund with the Wis-
consin Department of Revenue for the $1,000
of sales tax. The Department of Revenue pays
the refund to Buyer W on April 30, 2010.
Since Buyer W paid the tax to Seller X in Sep-
tember 2009, the period for which interest is
computed is October 31, 2009 (the last day of
the month following the month in which the tax
was paid by the buyer to the seller) to April 30,
2010 (six months). The interest portion of the
refund is computed as follows:
6 months
x .09 x $1,000 = $45.00
12 months
VII. OTHER
A. Buyer and Seller May Not Both Obtain Refunds
of Tax
Refunds will not be allowed to both the buyer and
seller for the tax on the same transaction. If refund
claims for the same transaction are filed by both the
seller and buyer, and both claims are approved by
the Department of Revenue, the Department of
Revenue will decide whether the buyer or seller will
receive the refund.
B. Offsetting a Refund Against Any Debts
The Department of Revenue may offset a sales or
use tax refund against any delinquent taxes and un-
paid amounts owed by the buyer or seller who filed
the claim for refund that are collectible by the De-
partment of Revenue on behalf of any governmental
unit.
C. Department of Revenue to Act on Claim
A claim for refund shall be regarded as a request for
determination. The determination shall be made by
the department within one year after the claim for
refund is received by the department, unless the
buyer or seller making the claim has consented in
writing to an extension of the one-year time period
prior to its expiration.
D. Seller to Refund Tax and Interest to Buyers or
the Department of Revenue
A seller is required to refund taxes and related in-
terest to the buyers from whom the taxes were
collected, in the following situations:
(a) The seller files a claim for refund with the Wis-
consin Department of Revenue, for taxes that
the seller has collected from buyers, and re-
ceives such refund.
(b) The seller files a claim for refund with the Wis-
consin Department of Revenue, for taxes that
the seller has collected from buyers, and the
seller is entitled to a refund of such taxes, but
the refund is offset against deficiencies of the
seller due and owing on the books of the Wis-
consin Department of Revenue.
(c) The seller collects amounts as taxes erroneously
from buyers, but the seller does not remit such
amounts to the state.
If the seller cannot locate the buyers, the seller must
return the taxes and related interest to the Wisconsin
Department of Revenue within 90 days after the
date of the refund, within 90 days after the date of
the offset, or within 90 days after discovering that
the seller has collected taxes erroneously from the
buyers.
Note: A person who collects amounts as taxes erro-
neously from buyers for a real property construction
activity or nontaxable service may reduce the taxes
and interest that he or she is required to submit to
the buyer or to the department for that activity or
service by the amount of tax and interest subse-
quently due and paid on the sale of or the storage,
use, or other consumption of
the property, items, or
goods listed in Parts II.A., B., C., and D. that are
Publication 216
12
used by the person in that activity or service and
transferred to the buyer.
VIII. PENALTIES
A. Incorrect Claim for Refund
Negligence Penalty: A buyer or seller who negli-
gently files an incorrect and excessive claim for a
refund of sales or use tax is subject to a penalty of
25% of the difference between the amount claimed
and the amount that should have been claimed.
Fraud Penalty: A buyer or seller who fraudulently
files an incorrect claim for a refund of sales or use
tax is subject to a penalty of 100% of the difference
between the amount claimed and the amount that
should have been claimed.
B. Failure to Return Tax to Buyer or Department
Negligence Penalty: If a seller is refunded tax and
interest by the Department of Revenue for tax col-
lected from a buyer, and the seller fails to return the
tax and interest to the buyer or the department with-
in 90 days after the date of refund or offset, the
seller is subject to a penalty of 25% of the amount
not returned.
Fraud Penalty: If a seller is refunded tax and inter-
est by the Department of Revenue for tax collected
from a buyer, and the seller fails to return the tax
and interest to the buyer or the department within
90 days after the date of the refund or offset due to
fraud, the seller is subject to a penalty of 100% of
the amount not returned.
Note: An “offset” is the amount of a seller’s claim
for refund of sales and use taxes and related interest
to which the seller is entitled, but which is applied
against delinquencies of the seller due and owing on
the books of the Wisconsin Department of Revenue.
The amount of the offset is included in determining
the amount of the refund which the seller must re-
fund to the buyer or the Department of Revenue.
C. Failure to Produce Records
A person who fails to produce records or documents
requested by the Department of Revenue in a field
audit or in a summons, that support amounts or oth-
er information required to be shown on any sales
and/or use tax return that is required to be filed,
may be subject to any of the following, as deter-
mined by the Department of Revenue, except that
the penalty may not be imposed if the person shows
that under all facts and circumstances the person's
response, or failure to respond, to the department's
request was reasonable or justified by factors be-
yond the person's control:
1. The disallowance of deductions, credits, ex-
emptions, or inclusions of additional taxable
sales or additional taxable purchases to which
the requested records relate
2. A penalty for each violation of this subsection
that is equal to the greater of $500 or 25 percent
of the amount of the additional tax on any ad-
justment made by the department that results
from the person's failure to produce the records.
See sec. Tax 11.90, Wis. Adm. Code.
IX. SPECIAL SITUATIONS NOT
REQUIRING THE SELLER TO
FILE A CLAIM FOR REFUND
A seller does not need to file a claim for refund in the
following situations:
A. Sale Returns and Price Adjustments
The seller has refunded, in cash or credit, all or a
portion of the sales price as a result of property re-
turned or adjustments in the sales price after the
sale has been completed, provided:
1) The seller has included the refunded receipts in
the current period’s return or a prior period re-
turn of the seller, and paid the tax on those
receipts; and
2) The seller has refunded the tax to the buyer.
In this situation, the seller may claim a deduction
from gross receipts for the amount of the purchase
price refunded to the buyer on Line 4 (Sales returns,
allowances, and bad debts) of Form ST-12, Wiscon-
sin Sales and Use Tax Return, for the period in
Filing Claims for Refund of Sales or Use Tax
13
which the refund of the purchase price was made to
the buyer.
B. Bad Debts
“Bad debt” as used below, means the portion of the
sales price or purchase price that the seller has re-
ported as taxable for Wisconsin sales and use tax
purposes and paid the tax thereon to the department
and that the seller may claim as a deduction under
section 166 of the Internal Revenue Code. “Bad
debt” does not include financing charges or interest,
sales or use taxes imposed on the sales price or pur-
chase price, uncollectible amounts on tangible
personal property or items, property, or goods,
listed in Parts II.A., B., C., or D. that remain in the
seller’s possession until the full sales price or pur-
chase price is paid, expenses incurred in attempting
to collect any debt, debts sold or assigned to 3rd
parties for collection, and repossessed property or
items.
Claiming a Deduction for Bad Debts: A seller may
claim a deduction on a sales or use tax return for the
amount of any bad debt that the seller writes off as
uncollectible in the seller's books and records and
that is eligible to be deducted as a bad debt for fed-
eral income tax purposes, regardless of whether the
seller is required to file a federal income tax return.
The seller must claim the deduction on the return
that is submitted for the period in which the seller
writes off the amount of the deduction as uncollect-
ible in the seller's books and records and in which
such amount is eligible to be deducted as bad debt
for federal income tax purposes. If the seller subse-
quently collects in whole or in part any bad debt for
which a deduction is claimed under this paragraph,
the seller shall include the amount collected in the
return filed for the period in which the amount is
collected and shall pay the tax with the return. In
addition, the following apply to bad debts:
1. For purposes of computing a bad debt deduc-
tion or reporting a payment received on a
previously claimed bad debt, any payment
made on a debt or on an account is applied first
to the price of the property, items, or goods
listed in Parts II.A., B., C., and D., or taxable
services sold, and the proportionate share of the
sales tax on the property, items, or goods listed
in Parts II.A., B., C., or D., or services, and then
to interest, service charges, and other charges
related to the sale.
2. If a bad debt relates to the retail sales of the
property, items, or goods listed in Parts II.A.,
B., C., and D., or taxable services that were
sourced to this state and to one or more other
states, the total amount of such bad debt shall
be apportioned among the states to which the
underlying sales were sourced in a manner pre-
scribed by the department to arrive at the
amount of the deduction.
The “sourcing” of a sale refers to the location in
which the sale takes place, as provided in
sec. 77.522, Wis. Stats.
3. A seller may obtain a refund of the tax on the
bad debt amount deducted under the paragraph
titled “Claiming a Deduction for Bad Debts”
that exceeds the amount of the seller's taxable
sales, except that the period for making a claim
as determined under Part V.A. begins on the
date on which the return on which the bad debt
could be claimed would have been required to
be submitted to the department.
4. If a seller is using a certified service provider,
the certified service provider may claim a bad
debt deduction on the seller's behalf if the seller
has not claimed and will not claim the same de-
duction. A certified service provider who
receives a bad debt deduction shall credit that
deduction to the seller and a certified service
provider who receives a refund shall submit that
refund to the seller.
Note: If the retailer fails to claim the deduction for
the bad debt on the original return that is filed for
the period in which the debt became a “bad debt,”
the retailer must file an amended return for that pe-
riod, as explained in Part I V. A . , to claim the bad
debt.
Example: Retailer A has a bad debt of $10,000 for
the period March 2009. Retailer A filed a sales tax
return for March 2009, but did not claim the deduc-
tion for the bad debt. The unextended due date for
March 2009 return is April 20, 2009. To claim the
$10,000 deduction for the bad debt, Retailer A must
file an amended return for the period of March
Publication 216
14
2009. Retailer A has until April 20, 2013, (four
years from the unextended due date of the return on
which the bad debt may be claimed), to file the
amended return.
C. Tax Paid on Purchase of Leased Property
If a lessor of property, items, or goods listed in
Part II.A., B., C., or D. reimbursed the vendor for
sales tax on the sale of the property, items, or goods
by the vendor to the lessor, the tax due from the les-
sor on the rental receipts may be offset by a credit
equal to, but not exceeding, the tax otherwise due
on the rental receipts from the property, items, or
goods for the reporting period. The credit expires
when the cumulative rental receipts equal the sales
price upon which the vendor paid sales taxes to the
Department of Revenue. The credit is claimed by
taking a deduction on Line 5 “Other subtractions”
of Form ST-12, Wisconsin Sales and Use Tax Re-
turn, or the online form using My Tax Account, for
the amount of rental receipts from the property,
items, or goods included in gross receipts on Line 1
of Form ST-12 by the lessor during the period cov-
ered by the return.
D. Tax-Paid Purchases Resold
If a purchaser of property, items, or goods listed in
Part II.A., B., C., or D. reimbursed the vendor for
sales tax on the sale and subsequently, prior to mak-
ing any use of the property, items, or goods, other
than retention, demonstration or display while hold-
ing it for sale or rental, makes a taxable sale of the
property, items, or goods, the tax due on the taxable
sale may be offset by the tax reimbursed. The offset
is claimed by taking a deduction on Line 5 “Other
subtractions” of Form ST-12, Wisconsin Sales and
Use Tax Return or the online form using My Tax
Account, for the amount of the purchase price paid
for the property, items, or goods resold. The offset
is claimed on the same return which includes the
sales price for the property, items, or goods resold.
Note: In situations C and D, do not take a credit or off-
set for tax-paid purchases resold in a non-taxable
transaction. You must request a refund of the tax paid
from the vendor who sold you the property, items, or
goods or file a Buyer’s Claim for Refund with the De-
partment of Revenue.
X. IF YOU HAVE QUESTIONS
If you have a question about sales and use taxes, call,
write, or email the department.
Write . . . Wisconsin Department of Revenue
Mail Stop 5-77
PO Box 8946
Madison, WI 53708-8946
Telephone . . . (608) 266-2776
Fax . . . (608) 267-1030
Email . . .
DORSalesandUse@revenue.wi.gov
Visit our website . revenue.wi.gov
