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Regular Session, 2011
SENATE BILL NO. 177
BY SENATOR HEITMEIER
TAX/INCOME /PERSONAL. Grants a non-refundable income tax credit equal to the
deduction taken by a resident taxpayer on his federal return for interest paid on a loan for
himself or a resident dependent or spouse if they are graduates from the baccalaureate level
and the education loan is a loan for education above the baccalaureate level. (gov sig)
AN ACT1
To enact R.S. 47:297.13, relative to individual income tax; to provide a credit for interest2
paid on certain education loans which pay higher education expenses; and to provide3
for related matters.4
Be it enacted by the Legislature of Louisiana:5
Section 1. R.S. 47:297.13 is hereby enacted to read as follows: 6
ยง297.13. Tax credit; interest paid on graduate education loans7
A. Effective in the year in which the secretary of the Department of8
Revenue receives the certification of revenue neutrality provided for in9
Subsection C of this Section before September first of that year, there shall be10
credit against individual income tax due under this Part in an amount equal to11
the adjustment to gross income properly taken by a resident taxpayer on his12
federal income tax return for the same tax period for interest paid by the13
resident taxpayer, or paid on behalf of a resident spouse or dependent, during14
that tax period for a qualified education loan incurred to pay qualified higher15
education expenses as provided for in Internal Revenue Code Section 221(b)(1);16
provided that such resident taxpayer, spouse, or dependent is a graduate from17 SB NO. 177
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the baccalaureate level and the education loan was a loan for education above1
the baccalaureate level.2
B. The credit provided for in this Section shall not be allowed to a3
taxpayer if he, or the spouse or dependent for whom the credit is taken, is not4
a resident of the state of Louisiana for the tax period for which the credit is5
taken.6
C.(1) The provisions of this Section shall not become effective until the7
year in which the secretary of the Department of Revenue receives written8
certification from both the Division of Administration and the Legislative Fiscal9
Office that the credit provided for in this Section is likely to achieve revenue10
neutrality at some time after it becomes effective.11
(2) "Revenue neutrality" means that both the Division of Administration12
and the Legislative Fiscal Office reasonably estimates that the cost to the state13
of the tax benefit provided to taxpayers pursuant to the provisions of this14
Section will be offset by the revenue received by the state because of the tax15
benefits provided to such taxpayers.16
Section 2. This Act shall become effective upon signature by the governor or, if not17
signed by the governor, upon expiration of the time for bills to become law without signature18
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If19
vetoed by the governor and subsequently approved by the legislature, this Act shall become20
effective on the day following such approval.21
The original instrument was prepared by Riley Boudreaux. The following
digest, which does not constitute a part of the legislative instrument, was
prepared by Linda Nugent.
DIGEST
Heitmeier (SB 177)
Proposed law grants a non-refundable credit against individual income tax in an amount
equal to the deduction from gross income properly taken by a resident taxpayer on his
federal income tax return for the same tax period for interest paid by the resident taxpayer,
or interest paid on behalf of a resident spouse or dependent, during that tax period for a
qualified education loan incurred to pay qualified higher education expenses. However, the
resident taxpayer, spouse, or dependent must be a graduate from the baccalaureate level and
the education loan must be a loan for education above the baccalaureate level. SB NO. 177
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Proposed law specifically prohibits the credit to a taxpayer if he, or the spouse or dependent
for whom the credit is taken, is not a resident of the state of Louisiana for the tax period for
which the credit is taken.
Proposed law provides that the credit will be effective for a taxpayer in the year in which the
Dept. of Revenue receives a certification of revenue neutrality before September first of that
year. Provides that "revenue neutrality" means that both the Division of Administration and
the Legislative Fiscal Office estimates that the cost of the tax benefit will be offset by the
revenue received by the state.
Effective upon signature of the governor or lapse of time for gubernatorial action.
(Adds R. S. 47:297.13)
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Revenue and Fiscal
Affairs to the original bill.
1. Increases the credit from 10% to all of the deduction on the federal return.
2. Requires the person for whom the credit is taken to be a graduate from the
baccalaureate level.
3. Requires the loan to be a loan for education above the baccalaureate level.
Senate Floor Amendments to engrossed bill.
1. Eliminates the effective date of January 1, 2011.
2. Provides that the credit will be effective for a taxpayer when the Dept. of
Revenue receives a certification of revenue neutrality.
3. Defines "revenue neutrality" to mean that both the Division of
Administration and the Legislative Fiscal Office estimates that the cost of the
tax benefit will be offset by the revenue received by the state.