SLS 21RS-695 ENGROSSED
2021 Regular Session
SENATE BILL NO. 240
BY SENATOR LUNEAU
TAX/TAXATION. Limits the utilization of income and corporation franchise tax credits
to total tax liability. (gov sig)
1 AN ACT
2 To enact R.S. 47:1675(K), relative to the utilization of income and corporation franchise tax
3 credits; to provide that the total corporation income and franchise tax credits claimed
4 in a tax year cannot exceed the corporation's tax liability for the tax year; to provide
5 that the total amount of certain business-related individual income tax credits cannot
6 exceed the taxpayer's individual income tax liability for the tax year; to limit
7 refundabilty of refundable credits; to provide for effectiveness; and to provide for
8 related matters.
9 Be it enacted by the Legislature of Louisiana:
10 Section 1. R.S. 47:1675(K) is hereby enacted to read as follows:
11 ยง1675. General administrative provisions for credits against income and corporation
12 franchise tax
13 * * *
14 K. Limitation on the utilization of income and corporation franchise tax
15 credits:
16 (1) For all taxable years beginning on or after January 1, 2022,
17 notwithstanding any provision of law to the contrary including contrary
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions. SB NO. 240
SLS 21RS-695 ENGROSSED
1 provisions in applicable tax credit statutes, total tax credits allowed pursuant
2 to Subtitle VII of this Title shall not exceed the total corporation income and
3 corporation franchise tax liability of any taxpayer required to file a corporate
4 income or corporation franchise tax return. If the total amount of applicable tax
5 credits authorized pursuant to Subtitle VII of this Title exceeds the amount of
6 corporation income and corporation franchise tax liability for the tax year, the
7 excess credits shall not be refundable.
8 (2) For all taxable years beginning on or after January 1, 2022,
9 notwithstanding any provision of law to the contrary including contrary
10 provisions in applicable tax credit statutes, total tax credits allowed pursuant
11 to Subtitle VII of this Title, other than the credits provided for in R.S. 47:6104
12 and 6106, shall not exceed the total individual income tax liability of any
13 taxpayer required to file an individual income tax return. If the total amount
14 of applicable tax credits authorized pursuant to Subtitle VII of this Title exceeds
15 the amount of individual income tax liability for the tax year, the excess credits
16 shall not be refundable, other than the credits provided for in R.S. 47:6104 and
17 6106.
18 (3) For all taxable years beginning on or after January 1, 2022,
19 notwithstanding any provision of law to the contrary including contrary
20 provisions in applicable tax credit statutes, total tax credits allowed pursuant
21 to Subtitle VII of this Title shall not exceed the total fiduciary income tax
22 liability of any taxpayer required to file a fiduciary income tax return. If the
23 total amount of applicable tax credits authorized pursuant to Subtitle VII of this
24 Title exceeds the amount of tax liability for the tax year, the excess credits shall
25 not be refundable.
26 (4) Tax credits that are in excess of the taxpayer's tax liability for a
27 taxable year that would be refundable but for the provisions of this Subsection
28 may be carried forward as a credit against subsequent Louisiana income or
29 corporation franchise tax liability for a period not to exceed five years.
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions. SB NO. 240
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1 Section 2. This Act shall become effective upon signature by the governor or, if not
2 signed by the governor, upon expiration of the time for bills to become law without signature
3 by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If
4 vetoed by the governor and subsequently approved by the legislature, this Act shall become
5 effective on the day following such approval.
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 240 Engrossed 2021 Regular Session Luneau
Present law authorizes a variety of tax credits that can be utilized to reduce income and
corporation franchise tax due dollar-for-dollar and further provides that for a limited number
of these credits that any tax credit balance in excess of the current year's tax liability shall
be refunded to the taxpayer.
Proposed law provides that the total tax credits available to a corporate taxpayer shall not
reduce the taxpayer's corporate income and corporate franchise tax liability below zero and
any excess credit shall not be refundable even if the statute creating the credit provides for
refundability.
Proposed law provides that the total business tax credits available to an individual taxpayer
shall not reduce the taxpayer's individual tax liability below zero and any excess credit shall
not be refundable even if the statute creating the credit provides for refundability, except for
the School Readiness child care expense tax credit and the child care directors and staff tax
credit.
Proposed law provides that beginning on or after January 1, 2022, the total tax credits
authorized in present law shall not exceed the total fiduciary income tax liability of any
taxpayer required to file a fiduciary income tax return. If the total amount of applicable tax
credits exceeds the amount of tax liability for the tax year, the excess credits are not
refundable.
Proposed law authorizes credits that would be refundable but for the provisions of proposed
law to be carried forward to be used against subsequent tax liability for up to five years.
Effective upon signature of the governor or lapse of time for gubernatorial action.
(Adds R.S. 47:1675(K))
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Revenue and Fiscal
Affairs to the original bill
1. Adds the child care directors and staff tax credit to the list of exceptions for
individual income tax only.
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2. Provides that the total tax credits shall not exceed the total fiduciary income
tax liability of any taxpayer required to file a fiduciary income tax return and
any excess credits are not refundable.
3. Makes technical changes.
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.