HLS 15RS-1098 ENGROSSED
2015 Regular Session
HOUSE BILL NO. 383
BY REPRESENTATIVES JACKSON, BURRELL, COX, GAINES, HALL, HUNTER,
JAMES, TERRY LANDRY, PIERRE, SMITH, AND WOODRUFF
TAX/CORP INCOME: Removes the carryback provisions for the net operating loss
deduction for purposes of the corporate income tax
1 AN ACT
2To amend and reenact R.S. 47:246(E) and (G), 287.86(A), (B), (C), (D), and (E),
3 1621(B)(7), and 1623(C) and to repeal R.S. 47:287.86(F), (G), (H), and (I), relative
4 to corporate income tax; to provide for the net operating loss deduction; to eliminate
5 net operating loss deduction carryback; to provide for an effective date; and to
6 provide for related matters.
7Be it enacted by the Legislature of Louisiana:
8 Section 1. R.S. 47:246(E) and (G), 287.86(A), (B), (C), (D), and (E), 1621(B)(7),
9and 1623(C) are hereby amended and reenacted to read as follows:
10 §246. Corporations; deduction from net income from Louisiana sources
11 * * *
12 E. At the election of the taxpayer a net operating loss deduction as
13 determined in Subsection B may be a net operating loss carry-back to each of the
14 three taxable years preceding the taxable year of such loss. Such election shall be
15 made in accordance with rules and regulations prescribed by the Secretary of
16 Revenue and Taxation. The first period to which a net operating loss may be carried
17 under this provision is taxable years beginning on or after January 1, 1980. For all
18 claims for this deduction on any return filed on or after July 1, 2015, regardless of
19 the taxable year to which the return relates, no carry-back election shall be allowed.
20 * * *
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HB NO. 383
1 G. Any amount actually refunded, tentative or otherwise, as an overpayment
2 resulting from a net operating loss carry-back shall bear interest at the rate provided
3 in R.S. 47:1624 computed ninety days after the date the request for tentative refund
4 or claim for refund (amended return) is filed, or from ninety days after the due date,
5 without regard to extensions of time, to file of the loss year return, whichever is later.
6 For all claims for this deduction on any return filed on or after July 1, 2015,
7 regardless of the taxable year to which the return relates, no refund shall be allowed.
8 * * *
9 §287.86. Net operating loss deduction
10 A. Deduction from Louisiana net income. Except as otherwise provided, for
11 all claims for this deduction on any return filed on or after July 1, 2015, regardless
12 of the taxable year to which the return relates, there shall be allowed for the taxable
13 year an adjustment reducing Louisiana net income in an amount equal to the
14 aggregate of:
15 (1) The net operating loss carryovers to such year, plus.
16 (2) The net operating loss carrybacks to such year.
17 B. Net operating loss carrybacks and carryovers. The For all claims for this
18 deduction on any return filed on or after July 1, 2015, regardless of the taxable year
19 to which the return relates, the taxable years to which a Louisiana net loss may be
20 carried shall be:
21 (1) A net operating loss carryback to each of the three taxable years
22 preceding the taxable year of such loss, unless carryback treatment is
23 relinquished pursuant to R.S. 47:287.86(D).
24 (2) For losses incurred for taxable years beginning before January, 1984, a
25 net operating loss carryover to each of the five taxable years following the taxable
26 year of such loss. For losses incurred for taxable years beginning on or after January
27 1, 1984, a net operating loss carryover to each of the fifteen taxable years following
28 the taxable year of such loss.
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HB NO. 383
1 C. Manner and amount of carrybacks and carryovers. The For all claims for
2 this deduction on any return filed on or after July 1, 2015, regardless of the taxable
3 year to which the return relates, the entire amount of Louisiana net loss for any
4 taxable year, hereinafter the "loss year", shall be carried back over to the earliest of
5 the taxable years allowed, unless an election to relinquish carryback treatment is
6 made, in which case such loss shall be carried to the earliest of the taxable years
7 allowed for carryovers. The portion of such loss which shall be carried to each of
8 the other taxable years allowed by Subsection B shall be the excess, if any, of the
9 amount of such loss over the aggregate of the Louisiana taxable income for each of
10 the prior taxable years to which such loss may be carried. For the purposes of this
11 Subsection:
12 (1) Louisiana taxable income shall not be adjusted to less than zero.
13 (2) In calculating the aggregate Louisiana taxable incomes in cases where
14 more than one loss year must be taken into account, the various net operating loss
15 carryovers and carrybacks to such taxable year are considered to be applied in
16 reduction of Louisiana net income in the order of the taxable years from which such
17 losses are carried over or carried back, beginning with the loss for the earliest taxable
18 year.
19 D. Election to relinquish carryback. Any taxpayer may make an election to
20 relinquish the carryback treatment allowed and have its Louisiana net loss treated
21 only as a carryover. Such election shall be made as prescribed by the secretary.
22 E.D. Statement with tax return. Every corporation claiming a net operating
23 loss deduction for any taxable year shall file with its return for such year a concise
24 statement setting forth the amount of the net operating loss claimed and all material
25 and pertinent facts relative thereto, including a detailed schedule showing the
26 computation of the net operating loss deduction.
27 * * *
28 I. E. Net operating loss carryovers.
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HB NO. 383
1 (1) Notwithstanding any other provisions of this Chapter to the contrary, for
2 all claims for this deduction on any return filed on or after July 1, 2015, regardless
3 of the taxable year to which the return relates, the acquiring corporation shall
4 succeed to and take into account, as of the close of the day of distribution or transfer,
5 the aggregate net operating loss carryovers of the distributors or transferor
6 corporation as determined under this Section, subject to federal law and the
7 limitations provided thereunder.
8 (2) Net operating losses generated after the effective date of a reorganization
9 cannot be carried back to a corporation that does not survive the reorganization,
10 unless the reorganization is a reorganization under Internal Revenue Code Section
11 368(a)(1)(F). For purposes of this Part, the surviving entity of a reorganization under
12 Internal Revenue Code Section 368(a)(1)(F) is the same entity as the transferor
13 entity, and the reorganization will be treated as a mere change in form.
14 * * *
15 §1621. Refunds of overpayments authorized
16 * * *
17 B. The secretary shall make a refund of each overpayment where it is
18 determined that:
19 * * *
20 (7) With regard to a Louisiana income tax overpayment, the overpayment
21 resulted from application of a Louisiana net operating loss carryback or carryover.
22 * * *
23 §1623. Prescription of refunds or credits
24 * * *
25 C. Provided that in any case where a refund relates to an overpayment
26 attributable to a net operating loss deduction carry-back election made pursuant to
27 R.S. 47:246(E) or 287.86, for taxable periods ending on or after December 31, 1983,
28 in lieu of the three-year period of limitation prescribed in Subsection A of this
29 Section, the period shall be the period which ends three years from the thirty-first
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HB NO. 383
1 day of December of the year in which the tax for the loss year would become due or
2 the period prescribed in Subsection B or E of this Section with respect to such
3 taxable year, whichever expires later. No refund shall be allowed for any claim for
4 this deduction on any return filed on or after July 1, 2015, regardless of the taxable
5 year to which the return relates.
6 * * *
7 Section 2. To repeal R.S. 47:287.86(F), (G), (H), and (I) in their entirety.
8 Section 3. The provisions of this Act shall apply to all claims for this deduction on
9any return filed on or after July 1, 2015, regardless of the taxable year to which the return
10relates.
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 383 Engrossed 2015 Regular Session Jackson
Abstract: For any claim filed on or after July 1, 2015, regardless of the taxable year to
which the return relates, eliminates the three year carryback of the net operating loss
deduction for purposes of calculating corporate income tax liability.
Present law provides for imposition, computation, and payment of income tax for estates and
property held in trust. Present law further authorizes the net operating loss to be deducted
from net income in any of the 15 years immediately following the year in which the loss
occurred.
Present law provides a deduction from Louisiana net income for a net operating loss to be
carried back three taxable years preceding the taxable year of such loss or carried over to
each of the 15 taxable years following the taxable year of such loss.
Proposed law repeals the three year carryback provisions of present law beginning with any
claim filed on or after July 1, 2015, regardless of the taxable year to which the return relates.
Present law provides for refunds of overpayment of taxes, penalties, and interest. Further
authorizes a refund when La. tax overpayment results from application of a net operating
loss carryback.
Proposed law retains present law but repeals provisions relative to net operating loss carry
back for any claim filed on or after July 1, 2015, regardless of the taxable year to which the
return relates.
Present law provides a three year prescriptive period within which a refund or credit shall
be paid and provides for suspension of the prescriptive period. Further provides a time table
for prescription when a refund or credit is attributable to a net operating loss deduction
carryback election.
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HB NO. 383
Proposed law retains present law but repeals provisions relative to the net operating loss
deduction carryback election for any claim filed on or after July 1, 2015, regardless of the
taxable year to which the return relates.
Proposed law applies to all claims for the net operating loss deduction on any return filed
on or after July 1, 2015, regardless of the taxable year to which the return relates.
(Amends R.S. 47:246(E) and (G), 287.86(A), (B), (C), (D), and (E), 1621(B)(7), and
1623(C); Repeals R.S. 47:287.86(F), (G), (H), and (I))
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Ways and Means to the
original bill:
1. Delete application of proposed law to tax years beginning on or after Jan. 1,
2015.
2. Add applicability of proposed law to all returns filed on or after July 1, 2015,
regardless of the taxable year to which the return relates.
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