The original instrument and the following digest, which constitutes no part of the
legislative instrument, were prepared by Danielle Doiron.
DIGEST
Proposed law establishes the Rapid Response to Declared Disasters Income Tax Exclusion Act to
exclude from gross income certain monies received for services rendered by nonresidents in
response to a disaster or emergency.
Proposed law defines the following terms:
(1)"Registered business in the state" means a business entity that is currently registered to do
business in the state and was registered prior to a declared state of emergency.
(2)"Nonresident business" means a business entity whose services are requested by a
registered business in the state or by a state or local government for purposes of
performing disaster or emergency related work in the state and that prior to the declared
state of emergency:
(a)Is not qualified or registered to do business in this state;
(b)Has no employees, agents or independent contractors in this state;
(c)Is not transacting business in this state; and
(d)Has not filed and is not required to file any state or local tax return in this state.
Provides that a "nonresident business" includes a business entity that is affiliated with a
registered business in this state solely through common ownership.
(3)"Out-of-state employee" means a nonresident individual who does not provide services or
activities in this state, except for disaster or emergency related work during a disaster
period.
(4)"Infrastructure" means property and equipment owned or used by communications
networks, electric generation, transmission and distribution systems, gas distribution
systems, water pipelines, and public roads and bridges and related support facilities that
services multiple customers or citizens including but not limited to real and personal
property such as buildings, offices, lines, poles, pipes, structures and equipment.
(5)"Declared state disaster or emergency" means a disaster or emergency event declared by
any of the following:
(a)A disaster or emergency has been declared by executive order or proclamation by the governor.
(b) A disaster or emergency for which a federal declaration of disaster or emergency
has been issued by the president.
(c)An event within the state for which a good faith response is required and for
which a registered business notifies the governor or appropriate local official of
the event and the governor or local official declares a disaster or emergency as
provided by law.
(6)"Disaster period" means a period that begins within ten days of the first day of the
governor's proclamation, the president's declaration or designation by any other
authorized official of the state whichever occurs first, and that extends for a period of 60
calendar days after the end of the declared disaster or emergency period, or any longer
period authorized by the designated state official or agency.
(7)"Disaster or emergency-related work" means repairing, renovating, installing, building,
rendering services or other business activities that relate to infrastructure that has been
damaged, impaired or destroyed by the declared disaster or emergency.
Proposed law requires that operations of a "nonresident business" conducted in the state for work
or services related to a declared state disaster or emergency shall not be considered to have a
level of presence that would require it to register or remit taxes to the department as required by
law and excludes income derived from such operations from gross income.
Proposed law requires that "out-of-state-employees" not be considered to have established
residency or presence in the state that would require that person or person's employer to file and
pay income taxes or be subjected to tax withholdings or to file and pay any other state or local
tax or fee during the disaster period, including any related state or local employer withholding
and remittance obligations.
Proposed law provides that "nonresident businesses" and "out-of-state employees" shall be
required to pay transaction taxes and fees including but not limited to fuel taxes or sales and use
taxes on materials or services subject to sales and use tax, hotel taxes, car rental taxes or fees that
the nonresident business or out-of-state employee purchases for use or consumption in the state
during the disaster period, unless such taxes are otherwise exempted during a disaster period.
Proposed law provides that any "nonresident business" or "out-of-state employee" that remains in
the state after the disaster period will become subject to the state's normal standards for
establishing presence, residency, or doing business in the state and will therefore become
responsible for any business or employee tax requirements that ensue.
Proposed law authorizes the secretary of the Department of Revenue to promulgate necessary
rules and regulations, develop and issue forms or online processes to implement the tax credit
program. Present law provides for definitions for "wages" with regard to the income tax for services
performed by an employee for his employer, including the cash value of all remuneration paid in
any medium other than cash and provides for terms excluded from remuneration.
Proposed law retains present law and adds an exclusion for services by a nonresident individual
during or in response to a declared state of emergency.
Present law provides for a class of gross income designated as "allocable income".
Proposed law excludes salaries, wages and other compensation received by a "nonresident
individual" for personal services rendered during a declared disaster from gross "allocable
income".
Proposed law excludes income from construction, repair, or other similar services received by a
"nonresident corporation" for disaster or emergency related work rendered during a declared
disaster from gross "allocable income".
Present law provides for a class of gross income designated as "apportionable income".
Proposed law excludes salaries, wages and other compensation received by a nonresident
individual for personal services rendered during a declared disaster and income from
construction, repair, or other similar services received by a nonresident corporation for disaster or
emergency related work rendered during a declared disaster from gross "apportionable income".
Proposed law provides that the definition of "Louisiana net income" does not include income
received by a "nonresident corporation" for construction, repair, or other similar services for
disaster or emergency related work rendered during a declared disaster.
Proposed law is applicable to all tax years beginning on or after January 1, 2013.
Effective upon signature of the governor or lapse of time for gubernatorial action.
(Amends R.S. 47:242 and 287.67(1)(g), (h), and (2); adds R.S. 47:53.5 and 111(A)(11))