Instructions for 2023 Form PW-U:               
       Underpayment of Estimated Withholding Tax by Pass-Through Entities 

  Purpose of Form PW-U                                                                                                  

 Pass-through entities use Form PW-U to determine if they are subject to interest for underpayment of estimated 
 withholding tax and, if so, the amount of interest. A pass-through entity must have made estimated withholding 
 tax payments if the total of its withholding tax for its taxable year beginning in 2023 is $500 or more. Form PW-
 U is also used to compute both extension and delinquent interest whenever the withholding tax due is paid after 
 the end of the unextended due date of the Form PW-1. 
 
  Part I: Computation of Underpayment and Interest Due on Underpayment                                                  

 Compute any underpayment of required installments and the amount of interest due in Part I. 

 Required installments are based on the smaller of: 

 (1) 90% of 2023 Wisconsin net tax, 

 (2) 100% of 2022 Wisconsin net tax, provided the 2022 return covered an entire 12-month period, or 

 (3) 90% of the 2023 Wisconsin net tax figured by annualizing income. 

 Line 1a: Enter the amount from Form PW-1, line 1. 

 Line 1b: Enter the amounts from Form PW-1, lines 3 and  4. 

 Line 1c: No underpayment interest is required if the pass-through entity meets any of two certain thresholds: 

 » If line 1c. is less than $500, enter zero and go to Part II, if applicable. 

 » If line 1c. is less than $5,000, the pass-through entity had no withholding tax liability for the preceding taxable 
  year, and the preceding taxable year covered 12 months, enter zero and go to Part II, if applicable. 

 Note: You have a “withholding tax liability” if the amount reported or required to be reported on line 1 of Form 
 PW-1 is greater than zero. 

 Line 3: If the pass-through entity had a withholding tax liability in 2022, enter the amount from 2022 Form PW-
 1 (line 1 minus the total of lines 3 and 4). 
 Line 5: If your taxable year is a full 12 months, the installment due dates are the 15thday of the 3 ,rd6 ,th9 , andth
 12thmonths of your taxable year. Enter the appropriate due dates in columns (a), (b), (c), and (d). 

 If a due date falls on a weekend or holiday, the due date becomes the business day immediately following the 
 weekend or holiday. 

 If your taxable year is less than 12 months, the installment due dates are shown in the table below: 
  
 IC-106 (R. 11-23) 
 

                                  2023 Wisconsin Form PW-U Instructions 
  
  Number of       Number of                             Installments are due on the 
                                                  th
  months in       installment                     15  day of each of the following months 
  taxable year    payments             Corporations               Persons other than corporations 
          1       None            N/A                     N/A 
                                                          st
                                  Last month of taxable   1  month following the close of the taxable 
          2       1 
                                  year                    year  
                                                          st
                                  Last month of taxable   1  month following the close of the taxable 
          3       1 
                                  year                    year 
                                  th                      th                               st
                                  4  and last months of   4 month of taxable year and 1  month 
          4       2 
                                  taxable year            following the close of the taxable year 
                                  th                      th                               st
                                  4  and last months of   4 month of taxable year and 1  month 
          5       2 
                                  taxable year            following the close of the taxable year 
                                  th                      th                               st
                                  4  and last months of   4 month of taxable year and 1  month 
          6       2 
                                  taxable year            following the close of the taxable year 
                                  th   th                 th      th                              st
                                  4 , 6 , and last months 4 and 6  months of taxable year and 1  
          7       3 
                                  of taxable year         month following the close of the taxable year 
                                  th   th                 th      th                              st
                                  4 , 6 , and last months 4 and 6  months of taxable year and 1  
          8       3 
                                  of taxable year         month following the close of the taxable year 
                                  th   th                 th      th                              st
                                  4 , 6 , and last months 4 and 6  months of taxable year and 1  
          9       3 
                                  of taxable year         month following the close of the taxable year 
                                  th   th th              th   th         th                                 st
                                  4 , 6 , 9 , and last    4 , 6 , and 9  months of taxable year and 1  
  10              4 
                                  months of taxable year  month following the close of the taxable year 
                                  th   th th              th   th         th                                 st
                                  4 , 6 , 9 , and last    4 , 6 , and 9  months of taxable year and 1  
  11              4 
                                  months of taxable year  month following the close of the taxable year 

 Line 6: Amount Due for Each Installment 
 Use the flow chart below to determine the amounts to enter on line 6: 

  Are you using the annualized    Yes     Complete Form PW-U, Part III, and enter the      
  income installment method?              amounts from line 45 on line 6.                  
            No 
                                                                                           
  Is your taxable year a full 12  Yes     Divide line 4 by 4 and enter the result in each 
  months?                                 column.                                          
            No 
                                          If 1 installment is required, enter 100% of line 4 in Column (a). If 2 
  Did you begin making estimated          installments are required, enter 75% of line 4 in Column (a) and 25% of 
  payments before you realized    No      line 4 in Column (b). If 3 installments are required, enter 50% of line 4 in 
  your taxable year would be less         Column (a) and 25% of line 4 in each of Columns (b) and (c). If 4 
  than 12 months?                         installments are required, divide line 4 by 4 and enter the result in each 
                                          column. 
          Yes 

  The initial estimated payments are 25% of the estimated tax payable with the last payment adjusted for the 
  difference between the estimated tax liability and the amount previously paid. 
  Example: Tax-Option (S) Corporation Z has been filing tax returns on a calendar year basis. On March 1, Z makes 
  an estimated payment. On April 1, Z changes to a fiscal year ending July 31 and must make 3 estimated payments 
  for the return beginning Jan. 1 and ending July 31. If Z owes estimated tax of $80,000 related to this return, then Z 
  enters the following on line 6: 
  Column (a) = $20,000 (25% of $80,000) 
  Column (b) = $20,000 (25% of $80,000) 
  Column (c) = $40,000 ($80,000 – Columns (a) and (b)) 

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                                 2023 Wisconsin Form PW-U Instructions 
  
  Lines 10 and 11: Complete lines 10 and 11 only if you have an overpayment on line 9 for one or more installment 
  periods. Overpayments should be carried back and/or carried forward in the following order: 
  1. Any overpayment on line 9, column (a), should be carried forward to the next installment period with an 
     underpayment and entered on line 11. Any remaining excess should be carried forward to the next installment 
     period with an underpayment and entered on line 11, etc. 
  2. Any overpayment on line 9, column (b), should be carried back to an underpayment in column (a) and entered 
     on line  10. Any remaining  excess should be  carried forward  to the next  installment  period with an 
     underpayment and entered on line 11, etc. 
  3. Any overpayment on line 9, column (c), should be carried back to underpayment(s) in column (b) then column 
     (a) and entered on line 10. Any remaining excess should be carried forward to an underpayment in column 
     (d) and entered on line 11. 
  4. Any overpayment on line 9, column (d), should be carried back to underpayment(s) in column (c), then 
     column (b), then column (a) and entered on line 10. 
  Note: If you carry back more than one overpayment to a prior installment period, fill in separately on line 10 
  each carryback used. 
  Caution: If you have an overpayment in more than one column see “Example of Carryforward and Carryback” 
  for clarification of how to apply the overpayments to any underpayments. 

  Example of Carryforward: 
  Column (a), line 9, has an overpayment of $10,000. Columns (b), (c), and (d), line 8, each  have underpayments 
  of $4,000. First, carryforward $4,000 of the overpayment from column (a) to column (b) by entering $4,000 on 
  line 11. Second, carryforward $4,000 of the overpayment from column (a) to column (c) by entering $4,000 on 
  line 11. Lastly, carryforward the remaining overpayment of $2,000 from column (a) to column (d) by entering 
  $2,000 on line 11. 
 
           Form PW-U                          Column (a)      Column (b)    Column (c)         Column (d) 
  Line 8 (underpayment)                                       $4,000        $4,000             $4,000 
  Line 9 (overpayment)                         $10,000                                         
  Line 10 (carryback)                                                                          
  Line 11 (carryforward)                                      $4,000        $4,000             $2,000 
  Example of Carryback: 
  Columns (a), (b), and (c), line 8, each have underpayments of $50,000. Column (d), line 9, has  an overpayment 
  of $125,000. First, carryback  $50,000  from column (d) to column (c) by entering $50,000  on line 10. Second, 
  carryback $50,000 from column (d) to column (b) by entering $50,000 on line 10. Lastly, carryback the remaining 
  overpayment of $25,000 from column (d) to column (a) by entering $25,000 on line 10. 
 
           Form PW-U                          Column (a)      Column (b)    Column (c)         Column (d) 
  Line 8 (underpayment)                        $50,000        $50,000       $50,000            
  Line 9 (overpayment)                                                                         $125,000 
  Line 10 (carryback)                          $25,000        $50,000       $50,000            
  Line 11 (carryforward)                                                                       

  Example of Carryforward and Carryback: 
  Both columns  (a) and  (c),  line  9, have an overpayment of $500.  Both  columns  (b) and  (d),  line 8,  have an 
  underpayment of $600. First, carryforward the overpayment of $500 from  column  (a) to  column  (b) by entering 
  $500 on line 11. Second, carryback $100 from column (c) to column (b) by entering $100 on line 10. Lastly, 
  carryforward the remaining overpayment of $400  from column (c) to column (d) by entering $400  on line 11. 

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                         2023 Wisconsin Form PW-U Instructions 
  
           Form PW-U                         Column (a)           Column (b)    Column (c)      Column (d) 
  Line 8 (underpayment)                                           $600                                $600 
  Line 9 (overpayment)                       $500                                $500       
  Line 10 (carryback)                                             $100                      
  Line 11 (carryforward)                                          $500                                $400 

 Lines 13 through 17:    Complete these lines to determine the amount of interest due on the underpayment. 
 Complete lines 13 and 15 only when an overpayment or late payment is carried back on line 10. If you apply 
 more than one payment to a given installment, attach a statement showing a separate computation for each 
 payment. 
 If you do not have a balance due by the unextended due date of Form PW-1 (2 1/2 months after the close of a 
 tax-option (S) corporation’s or a partnership’s taxable year or 3 1/2 months after the close of a trust’s or estate’s 
 taxable year), enter the amount from line 17 on Form PW-1. Otherwise, enter the amount from line 17 on Part II, 
 line 22, and complete the rest of Part II. 
 
  Part II: Computation of Other Interest and Penalty Due                                                        

 Complete Part II only if your return is not filed by the unextended due date and shows a balance due. 
 Line 20: Enter estimated withholding tax payments made and withholding tax withheld from lower-tier entities. 
 Line 24: The 12% interest applies to the tax on line 23, column (b), only for the extension periods. The 18% 
 interest applies to the sum on line 23, column (a), from the unextended  due date to the  date the  return  is filed. 
 The 18% interest also applies to the tax on line 23, column (b), from the extended due date to the date the 
 return is filed. Enter total interest from columns (a) and (b) on column (c). 
 Line 25a: The “net tax due” is the total tax and economic development surcharge less any allowable credits, 
 withholding, and estimated payments made by the due date, including extensions, of the return. 
 
  Part III: Annualized Income Installment Method Worksheet                                                      

 If you compute one or more installments under the annualized income installment method, complete Part III 
 and enter the amounts from Part III, line 45 on Part I, line 6. 
   
 See sec. Tax 2.89, Wis. Adm. Code, if the taxable year covers less than 12 months. 
  
 Lines 27 and 30: Do not include on line 27 items which remain constant from period to period, such as net 
 business loss carryforwards and amortization of adjustments for changes in method of accounting. Instead, enter 
 these items on line 30, columns (a) through (d), in total. 
  
                                            Applicable Laws and Rules 
  This document provides statements or interpretations of the following laws and regulations enacted as of 
  November 1, 2023: secs. 71.775 and 990.001(4), Wis. Stats., and sec. Tax 2.89, Wis. Adm. Code. 

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