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Prepared by Danielle Doiron.
Thibaut HB No. 563
(KEYWORD, SUMMARY, AND DIGEST as amended by Senate committee
amendments)
TAX CREDITS: Changes eligibility and provides for administrative changes for the
Research and Development Tax Credit
DIGEST
Present law provides for research and development income tax credits for taxpayers
(businesses) who employ a certain number of people and who are eligible for federal tax
credits for certain qualified research and development expenditures. There is an application
process through which a business submits documents to the Dept. of Economic Development
(department).
Proposed law retains present law and requires that businesses seeking the tax credit provide
certain federal income tax information as may be requested by the department.
Proposed law authorizes eligibility for businesses with less than 50 employees if the business
can provide to the department a report by a certified public accountant relative to the
taxpayer's expenditures qualifying for federal research and development tax credits and other
information based upon procedures and regulations developed by the department in
accordance with the Administrative Procedure Act.
Proposed law further provides that unless the business has a U.S. patent issued or pending
which is directly related to research expenditures for which the tax credit is sought,
professional services firms and businesses primarily engaged in custom manufacturing and
custom fabricating are not eligible for the tax credit.
Proposed law requires the department to perform a detailed examination of at least 10% of
the tax credit applications, including a review and verification of documents to support
qualified research expenditures.
Proposed law provides that the applicant shall bear the burden of proving that its research
activities meet federal guidelines.
Proposed law provides that the department shall disallow tax credits not supported by
documentation and may recover, recapture, or offset tax credits which had been previously
issued.
Effective on July 1, 2013 for tax years beginning on or after January, 1, 2013.
(Amends R.S. 47:6015(B), (C)(2)(c), (G), (H), and (I); Adds R.S. 47:6015(J))
Summary of Amendments Adopted by House
House Floor Amendments to the engrossed bill.
1. Added exceptions in the application process for businesses employing less than
50.
2. Added provisions regarding the report required from a certified public accountant
relative to the taxpayer's expenditures qualifying for federal income tax credits.
3. Added provision allowing eligibility for professional services firms and
businesses engaged primarily in custom manufacturing and fabrication if those
businesses have a U.S. patent issued or pending which is directly related to
research expenditures for which the tax credit is sought. Page 2 of 2
Prepared by Danielle Doiron.
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Revenue and Fiscal Affairs
to the reengrossed bill
1. Deletes the need for an "independent" CPA to prepare the report required of
taxpayers who employ less than 50 employee to apply for credits and deletes the
requirements for the contents of the report and instead authorizes the Department
of Economic Development to provide for the contents and procedures related to
the report through regulations adopted in accordance with the APA.
2. Changes the date the new provisions become applicable from "January 1, 2012"
to "January 1, 2013".