Louisiana Revised Statutes 47:33 – Credit for taxes paid in other states
NOTE: The La. Supreme Court, in the case of Smith v. Robinson (2018 WL 6382118), declared Act 109 of 2015 R.S. unconstitutional. See also Act 6 of the 2018 2nd E.S.
Terms Used In Louisiana Revised Statutes 47:33
- Precedent: A court decision in an earlier case with facts and law similar to a dispute currently before a court. Precedent will ordinarily govern the decision of a later similar case, unless a party can show that it was wrongly decided or that it differed in some significant way.
- Taxable year: includes , in the case of a return made for a fractional part of a year under the provisions of this Chapter or under regulations prescribed by the collector, the period for which return is made. See Louisiana Revised Statutes 47:98
Subject to the following conditions, resident individuals shall be allowed a credit against the taxes imposed by this Chapter for net income taxes imposed by and paid to another state on income taxable under this Chapter, provided that:
(1) The credit shall be allowed only for taxes paid to the other state on income which is taxable under its law irrespective of the residence or domicile of the recipient.
(2) If accrued taxes when paid differ from the amounts claimed as credits by the taxpayer, or if any tax paid is refunded in whole or in part, the taxpayer shall notify the secretary who shall redetermine the amount of the tax for the year or years affected, and the amount of tax due upon such redetermination, if any, shall be paid by the taxpayer upon notice and demand by the secretary, or the amount of tax overpaid, if any, shall be credited or refunded to the taxpayer in accordance with the provisions of La. Rev. Stat. 47:261 et seq. In the case of such tax accrued but not paid, the secretary as a condition precedent to the allowance of this credit may require the taxpayer to give a bond with sureties approved by the secretary in such sum as the secretary may require, conditioned upon the payment by the taxpayer of any amount of tax found due upon any such redetermination, and the bonds herein prescribed shall contain such further conditions as the secretary may require.
(3) The credits provided for in this Section shall be allowed only for the same taxable period as that for which the tax liability to the other state arose, irrespective of the method of accounting employed by the taxpayer. No deduction shall be allowed under La. Rev. Stat. 47:55 for any net income taxes paid to another state if any portion of such tax has been claimed as a credit under this Section.
(4)(a) The credit shall be limited to the amount of Louisiana income tax that would have been imposed if the income earned in the other state had been earned in Louisiana.
(b) The credit shall not be allowed for tax paid on income that is not subject to tax in Louisiana. The amount of the credit shall not exceed the ratio which shall be determined by multiplying the taxpayer’s Louisiana income tax liability before consideration of any credit described in this Section by a fraction, the numerator of which is the taxpayer’s Louisiana tax table income attributable to other states to which net income taxes were paid by a resident individual, and the denominator of which is total Louisiana tax table income.
(5) The credit shall not be allowed for income taxes paid to a state that allows a nonresident a credit against the income taxes imposed by that state for taxes paid or payable to the state of residence.
(6)(a) For taxes paid on or after January 1, 2018, an individual partner, member, or shareholder that pays another state’s entity-level tax that is based solely upon net income included in the entity’s federal taxable income without any capital component shall be allowed a deduction equal to their proportionate share of the entity-level tax paid.
(b) The deduction pursuant to this Paragraph shall be allowed only to the extent that the proportionate share of the related income on the tax paid to the other state is included in the calculation of Louisiana taxable income that is reported on the Louisiana return of the individual partner or member.
(c) The deduction authorized pursuant to the provisions of this Paragraph shall be in lieu of and not in addition to the credit authorized in this Section.
Amended by Acts 1950, No. 445, §1; Acts 1958, No. 169, §2; Acts 1968, No. 106, §3; Acts 1998, No. 53, §, eff. Aug. 15, 1998; Acts 2015, No. 109, §1, eff. July 1, 2015; §2, eff. July 1, 2018; Acts 2018, 2nd Ex. Sess., No. 6, §§1, 2, eff. June 12, 2018; Acts 2023, No. 413, §§1, 2, eff. June 15, 2023.
NOTE: THE PROVISIONS OF ACT NO. 53 OF THE 1998 R.S., WHICH PROVIDE THAT A CREDIT FOR INCOME TAXES, IMPOSED BY AND PAID TO ANOTHER STATE ON INCOME DERIVED FROM PROPERTY IS AVAILABLE IN THE TAXABLE YEAR IN WHICH THE TAXES ARE ACTUALLY PAID, SHALL BE EFFECTIVE UNTIL JULY 1, 2000.
NOTE: See Acts 2015, No. 109, §4, re: applicability.