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 506 Reengrossed 2021 Regular Session Beaullieu
Abstract: Increases the amount of the net operating loss deduction that may be claimed on returns
filed for tax years beginning on or after Jan. 1, 2021, through Dec. 31, 2023, to 80% of the
net operating loss carryovers for the taxable year.
Present law authorizes a deduction reducing La. net income in an amount equal to 72% of the net
operating loss carryovers for the taxable year for all claims on any return filed on or after July 1,
2015, regardless of the taxable year to which the return relates. Present law prohibits the amount of
the deduction from exceeding 72% of the La. net income of the taxpayer.
Proposed law increases the amount of the deduction for net operating losses for claims on any return
for a taxable year beginning on or after Jan. 1, 2021, through Dec. 31. 2023, from 72% of the net
operating loss carryovers for the taxable year to 80% of the net operating loss carryovers for the
taxable year. Prohibits the amount of the deduction from exceeding 80% of the La. net income of
the taxpayer.
Proposed law provides that for all claims for the net operating loss deduction on any return filed for
a taxable year beginning on or after Jan. 1, 2024, the amount of the deduction shall be 72% of the
net operating loss carryovers for the taxable year.
Present law authorizes a La. net loss to be carried over for 20 taxable years following the taxable
year of the loss.
Proposed law retains present law.
Applicable to tax years beginning on or after Jan. 1, 2021.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Amends R.S. 47:287.69 and 287.86(A))
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Ways and Means to the original
bill: 1. Change the amount of the net operating loss deduction in proposed law from 100% of
the net operating loss carryovers for the taxable year to 80% of the net operating loss
carryovers for the taxable year.
2. Prohibit the amount of the net operating loss deduction from exceeding 80% of the La.
net income of the taxpayer.
The House Floor Amendments to the engrossed bill:
1. Limit the increase in the amount of the deduction for net operating losses to claims filed
for taxable years beginning on or after Jan. 1, 2021, through Dec. 31, 2023. The amount
of the deduction for taxable years beginning on or after Jan. 1, 2024, reverts to 72% of
the net operating loss carryovers for the taxable year.