Louisiana House Bill HB659

Louisiana 2021 Regular Session

• Introduced: 4/12/21
• Refer: 4/13/21
• Report Pass: 4/26/21

Caption

Establishes an income tax credit for taxpayers claiming a dependent less than eighteen years of age (EG -$60,600,000 GF RV See Note)

Impact

The bill is poised to impact the state's tax landscape significantly by providing fiscal relief to low to moderate-income families. It attempts to ease the financial burden of raising children, thereby likely influencing family welfare positively during the taxable years beginning on January 1, 2021. Furthermore, by offering a refundable credit for eligible taxpayers, it aims to stimulate the local economy, as families are expected to utilize the savings for essential needs.

Summary

House Bill 659 establishes a targeted income tax credit for Louisiana residents claiming children as dependents. This legislation introduces a financial benefit aimed at supporting parents and guardians of children aged less than eighteen years. The credit's value fluctuates based on the taxpayer's gross income and the age of the child, ranging from $200 to $500. Specifically, taxpayers with an income of less than $51,000 can receive up to $500 for children under six, while different amounts are offered for older children and for taxpayer income levels between $51,000 and $100,000.

Sentiment

Discussions surrounding HB 659 have generally reflected a favorable sentiment toward supporting families with children in Louisiana. Proponents highlight the bill as a step towards addressing the financial challenges faced by families, particularly those within the lower and middle-income brackets. However, some critics have expressed concerns about the bill's long-term fiscal implications on the state budget, fearing it could lead to decreased state revenue in the long run as credits are claimed.

Contention

A notable point of contention arose from concerns regarding the income thresholds set for the tax credit. Critics argue that the cut-offs might prevent many families with moderate incomes from qualifying, thereby limiting the bill's effectiveness in supporting a broader spectrum of households. Additionally, there were discussions about how sustainable these tax credits would be within the context of Louisiana's economic landscape, particularly given potential state funding shortfalls.