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 950 Engrossed 2016 Regular Session Foil
Abstract: Authorizes a state rebate for companies which receive a federal Small Business
Innovation Research Grant that is payable from current state tax collections.
Present law authorizes a nonrefundable income or corporation franchise tax credit for a taxpayer who
receives a federal Small Business Innovation Research Grant as created and provided for by federal
law. The amount of the credit is equal to 40% of the award received during the tax year.
Proposed law retains present law.
Proposed law authorizes a rebate for companies which receive a federal Small Business Innovation
Research Grant as created and provided for in federal law. The amount of the rebate is equal to 30%
of the award received during the tax year. Proposed law caps the amount of rebates issued at $5
million per calendar year.
Proposed law requires qualifying entities to submit an application to DED by Dec. 31st of the year
following the calendar year in which the entity qualified for the incentive rebate and to remit the
application fee as required in present law. Further provides for information required to be submitted
with the application including the applicant's federal income tax return and supporting
documentation that shows the amount of the federal research credit for the same taxable year.
Proposed law requires the incentive rebates to be paid from the current collections of the taxes
imposed by present law.
Proposed law requires DED to approve rebates on a first-come, first-served basis until the maximum
amount of rebates have been issued. Rebate requests received on the same business day shall be
treated as received at the same time, and if the aggregate amount of rebate requests received on a
single business day exceeds the total amount of available rebates, rebates shall be approved on a pro
rata basis. Rebates applied for in any particular year in excess of the amount of rebates authorized
for that year shall be treated as having been applied for on the first day of the subsequent year and
shall be paid as a priority against the next year's maximum amount of authorized rebates.
Proposed law requires DED to administer the provisions of proposed law including to monitor the
implementation and operation of proposed law, conduct a continuing evaluation of the program,
assist any company in obtaining the benefits of any incentive or inducement program, and to receive
information from the Dept. of Revenue regarding the company, its direct and indirect owners, and
the amount of any incentive rebates claimed. Proposed law prohibits an entity from receiving any other incentive administered by DED for any
expenditure for which the entitiy receives a rebate pursuant to proposed law.
Applicable for all taxable years beginning on and after Jan. 1, 2016.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Adds R.S. 47:6361)
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Ways and Means to the original
bill:
1. Delete the rebate for 30% of the La. qualified research expenses for the taxable year for
companies that employ 50 or less employees in the state which also claim a federal
income tax credit for increasing research activities.
2. Delete the definition of "qualified research expenses" and "qualified research" from
proposed law.
3. Add provision that applicants applying for the rebate shall remit the application fee
provided for in present law.
4. Delete the exclusion provided for in proposed law for professional service firms and
businesses primarily engaged in custom manufacturing and custom fabricating that do
not have a pending or issued U. S. patent directly related to the qualified research
expenditures from participating in this rebate program.
5. Add provisions for the recovery of rebates that are later disallowed and authorizes the
collection of interest on recovered rebates at the rate of three percentage points above the
rate provided for in present law.