Louisiana House Bill HB511

Louisiana 2013 Regular Session

• Introduced: 4/8/13
• Refer: 4/8/13

Caption

Individual income tax exemption for overtime wages earned by certain employees who are subject to the Fair Labor Standards Act (OR DECREASE GF RV See Note)

Impact

If enacted, HB 511 would specifically amend existing state tax law to introduce provisions that grant an income tax exemption for overtime earnings. The bill also mandates the employers to maintain detailed records of overtime hours worked and the corresponding wages paid to employees. Moreover, the requirement for employers to provide employees with their overtime records emphasizes transparency and accountability in wage payment practices. This legislative change attempts to provide support to lower-income workers by ensuring that they are not overtaxed on additional earnings that reflect the value of their extra labor.

Summary

House Bill 511 proposes an individual income tax exemption for overtime wages purchased by certain employees, specifically those whose employment is covered under the Fair Labor Standards Act. The bill aims to exempt up to $500 of overtime wages from taxation for taxpayers with an adjusted gross income of $44,000 or less. This initiative is designed to alleviate the tax burden on lower-income workers who earn overtime wages, thereby providing some financial relief and promoting fairness in the tax structure.

Sentiment

The sentiment surrounding HB 511 appears generally positive, particularly among labor advocates and employees who benefit from overtime work. Supporters argue that this bill is a necessary step in acknowledging and compensating the hard work of lower-income workers, enabling them to retain a portion of their earnings without a tax penalty. However, there may be some concerns regarding fiscal implications and long-term sustainability of the state’s revenue if a significant portion of overtime wages becomes exempt from taxation, leading to debates among fiscal conservatives.

Contention

Discussion around HB 511 may center on the aspects of revenue loss for the state due to the introduced tax exemption. Critics may argue that while providing relief to employees is essential, the state must also ensure that its revenue streams are sufficient for public services. The challenge will be to balance employee benefits with the fiscal health of the state budget. Additionally, the practical implications of the record-keeping requirements on employers could be seen as burdening smaller businesses with new administrative tasks, prompting concerns about regulatory overreach.