What is this?
If the tax-option (S) corporation elected to be taxed at the entity level, reverse all items of income, gain, loss, or deduction included on your federal return for which the tax-option (S) corporation is including on their corporate income tax return. If the tax-option (S) corporation has made this election, the box will be checked on Schedule 5K-1, Part B, box 3
Where do I enter it?
If the adjustment is an addition to income for Wisconsin, enter it in the Additions to Income Section. If it is a subtraction, enter it in the Subtractions from Income Section. Use Code 57 for either entry in prior years not applicable for tax year 2020. If you have adjustments for more than on entity, enter each entity adjustment separately.
Do not reverse any item of tax-option (S) corporation income or loss reported on federal Schedule D. These items have already been removed from Wisconsin income when you completed Wisconsin Schedule WD.
What else do I need to do?
You are required to attach a copy of the 5K-1 to your return. To attach a copy of your K-1 to your return, visit the Credits section of your state return. You can also download it on the state website.
For more information, get Publication 102, Wisconsin Tax Treatment of Tax-Option (S) Corporations and Their Shareholders.