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2020 Second Extraordinary Session
SENATE BILL NO. 57
BY SENATORS LUNEAU, ALLAIN AND CARTER
REVENUE DEPARTMENT. Establishes reporting requirements for businesses and
governmental entities using service providers. (2/3 - CA7s2.1(A)) (1/1/21) (Item #23)
1 AN ACT
2 To amend and reenact R.S. 47:1508(B)(28) and to enact R.S. 47:114.1, relative to reporting
3 requirements to the Department of Revenue; to require businesses and governmental
4 entities that pay certain service providers to file reports; to provide for the format of
5 the reports; to provide for an exception to the confidentiality of the records of the
6 secretary of the Department of Revenue; to provide for definitions; to provide for
7 exceptions; to provide for penalties; and to provide for related matters.
8 Be it enacted by the Legislature of Louisiana:
9 Section 1. R.S. 47:1508(B)(28) is hereby amended and reenacted and R.S. 47:114.1
10 is hereby enacted to read as follows:
11 §114.1. Louisiana Act of Government Against Misclassified Employees
12 A. This Section shall be known and may be cited as the "Louisiana Act
13 of Government Against Misclassified Employees" or "LA A GAME".
14 B. The legislature hereby finds that the misclassification of employees is
15 a serious problem in Louisiana that drains revenues otherwise due to state and
16 local government and is contrary to the public policy of this state.
17 Misclassification of employees results in unfair competitive advantages and
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1 harms Louisiana businesses that properly comply with applicable laws. It is the
2 intent and purpose of this Section to encourage the secretary of the Louisiana
3 Department of Revenue and the secretary of the Louisiana Workforce
4 Commission to work collaboratively to detect, investigate, and extinguish cases
5 of misclassification of employees in this state utilizing the reports required by
6 this Section. Further, the legislature directs that the reporting requirements
7 shall be developed by the secretary as to cause the least amount of
8 administrative or compliance burden feasible to businesses and the state.
9 C. For purposes of this Section:
10 (1) "LA A GAME Annual Report" means a report prescribed by the
11 secretary and filed annually by a service recipient that includes the following
12 information:
13 (a) The service recipient's name, business name, and address.
14 (b) The service recipient's federal employer identification number, social
15 security number, Louisiana Department of Revenue account number, or other
16 identifying number as required by the secretary.
17 (c) The service provider's full name, address, social security number or
18 federal employer identification number, and the total amount paid to the service
19 provider during the calendar year.
20 (2) "Secretary" means the secretary of the Louisiana Department of
21 Revenue.
22 (3) "Service recipient" means any individual, person, corporation,
23 association, or partnership, or agent thereof, doing business in this state,
24 deriving trade or business income from sources within this state, or in any
25 manner is engaged in the course of a trade or business subject to the laws of this
26 state that pays, in the course of its trade or business, remuneration to a service
27 provider for services provided in this state. "Service recipient" includes any
28 agency or political subdivision of the state.
29 (4) "Service provider" means a person who is not an employee of the
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1 service recipient who receives remuneration for services performed for the
2 service recipient in Louisiana.
3 D. Beginning January 1, 2022, any service recipient who makes or is
4 required to make a return to the Internal Revenue Service, in accordance with
5 Section 6041A(a) of the Internal Revenue Code, relating to payments made to
6 a service provider as remuneration for services provided in this state, shall file
7 the LA A GAME Annual Report with the secretary as provided in this Section.
8 E.(1) The LA A GAME Annual Report required pursuant to this Section
9 shall be filed with the secretary on or before the 28th day of February of each
10 year for the preceding calendar year. The first LA A GAME Annual Report
11 shall be filed on or before February 28, 2022, for remunerations made during
12 calendar year 2021.
13 (2) Upon receipt of a written request from a service recipient in the
14 manner prescribed by the secretary, the secretary may grant a reasonable
15 extension of time, not exceeding thirty days, for filing the annual report.
16 (3) The secretary may waive the annual reporting requirement upon a
17 showing by the service recipient that the requirement creates an undue
18 hardship. A request for waiver shall be submitted to the secretary in the
19 manner prescribed by the secretary.
20 F.(1) A penalty shall be imposed for the delinquent submission of, or
21 failure to submit, the LA A GAME Annual Report in the form prescribed by
22 the secretary.
23 (2) For each failure to fully comply with LA A GAME Annual Report
24 filing requirements, the secretary may assess a penalty of one hundred dollars
25 for each service provider for whom the required information is not reported
26 timely or is incomplete. The total penalty imposed pursuant to this Subsection
27 shall not exceed ten thousand dollars per calendar year.
28 (3) If the failure to timely submit a complete and accurate LA A GAME
29 Annual Report is attributable, not to the negligence of the service recipient, but
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1 to other causes set forth in written form and considered reasonable by the
2 secretary, the secretary may waive all or any part of the specific penalty
3 provided for the failure.
4 G.(1) In consultation with service recipients and their representatives,
5 the secretary shall prescribe the forms and format to be used for compliance
6 with the provisions of this Section. The secretary may also prescribe the types
7 of media and record layout to be used in the submission of the LA A GAME
8 Annual Report consistent with Internal Revenue Service Form 1099-MISC,
9 Form 1099-NEC, or successor forms' filing requirements.
10 (2) The secretary may promulgate rules and regulations to prescribe any
11 alternative technological, mathematical, or data-driven methods for filing,
12 signing, and submitting any report, statement, or other document required
13 pursuant to this Section.
14 (3) The secretary shall design and provide for the electronic filing of LA
15 A GAME Annual Reports at no charge for use by the service recipients. The
16 secretary may require electronic filing of LA A GAME Annual Reports by rule
17 and shall provide for hardship exceptions.
18 * * *
19 §1508. Confidentiality of tax records
20 * * *
21 B. Nothing herein contained shall be construed to prevent:
22 * * *
23 (28) The sharing or furnishing, in the discretion of the secretary, of LA A
24 GAME Annual Reports required by R.S. 47:114.1 or other information to the
25 Louisiana Workforce Commission for the purposes of determining, investigating, or
26 prosecuting fraud related to all areas administered by the Louisiana Workforce
27 Commission. Any information shared or furnished shall be considered and held
28 confidential and privileged by the Louisiana Workforce Commission to the same
29 extent heretofore provided.
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1 * * *
2 Section 2. This Act shall become effective on January 1, 2021.
The original instrument was prepared by Leonore Heavey. The following
digest, which does not constitute a part of the legislative instrument, was
prepared by Curry J. Lann.
DIGEST
SB 57 Engrossed 2020 Second Extraordinary Session Luneau
Proposed law creates the "Louisiana Act of Government Against Misclassified Employees"
or "LA A GAME" and provides for annual reporting requirements.
Proposed law defines the following terms:
(1)"LA A GAME Annual Report" means a report prescribed by the secretary and filed
annually by a service recipient that includes the following information:
(a)The service recipient's name, business name, and address.
(b)The service recipient's federal employer identification number, social
security number, La. Dept. of Revenue account number, or other identifying
number as required by the secretary.
(c)The service provider's full name, address, social security number or federal
employer identification number, and the total amount paid to the service
provider during the calendar year.
(2)"Secretary" means the secretary of the La. Dept. of Revenue.
(3)"Service recipient" means any individual, person, corporation, association, or
partnership, or agent thereof, doing business in this state, deriving trade or business
income from sources within this state, or in any manner is engaged in the course of
a trade or business subject to the laws of this state that pays, in the course of its trade
or business, remuneration to a service provider for services provided in this state.
"Service recipient" includes any agency or political subdivision of the state.
(4)"Service provider" means a person who is not an employee of the service recipient
who receives remuneration for services performed for the service recipient in
Louisiana.
Proposed law requires any service recipient who makes or is required to make a return to the
IRS relating to payments made to a service provider as remuneration for services provided
in this state to file the annual report with the secretary beginning January 1, 2022.
Proposed law requires the first annual report to be filed on or before February 28, 2022 for
remunerations made during calendar year 2021.
Proposed law requires the annual report to be filed with the secretary on or before February
28th of each year for the preceding calendar year.
Proposed law authorizes the secretary to grant filing extensions and waive the annual
reporting requirement in certain circumstances.
Proposed law authorizes the secretary to assess a penalty of $100 for each service provider
for late or incomplete reports and caps the total penalty imposed at no more than $10,000
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per calendar year.
Proposed law requires the secretary to develop forms for the annual report in consultation
with service recipients.
Proposed law authorizes the secretary to promulgate rules and requires the secretary to
design and provide for the electronic filing of annual reports at no charge for use by the
service recipients and to provide for hardship exceptions.
Proposed law provides for an exception to the confidentiality of tax records of the secretary
of the Dept. of Revenue for the sharing of certain information with the Louisiana Workforce
Commission.
Effective January 1, 2021.
(Amends R.S. 47:1508(B)(28); adds R.S. 47:114.1)
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Revenue and Fiscal
Affairs to the original bill
1. Creates the "Louisiana Act of Government Against Misclassified
Employees" and provides for annual reporting requirements.
2. Requires any service recipient who is required to make a return to the IRS
relating to payments made to a service provider to file an annual report with
the secretary of the Dept. of Revenue beginning January 1, 2022 regardless
of the number of service providers used.
3. Increases the penalty cap from $7,500 to $10,000 per year.
4. Authorizes the secretary to promulgate rules and requires the secretary to
provide for the electronic filing of annual reports.
5. Requires the secretary of the Dept. of Revenue to consult with service
recipients when developing forms for the annual report.
6. Provides for an exception to the confidentiality of the records of the secretary
of the Dept. of Revenue for the sharing of certain information with the
Louisiana Workforce Commission.
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