A. The responsible official for each claimant agency will provide to the secretary of revenue and taxation a certified listing of all offset claims. The listing of offset claims must be made in writing or on magnetic tapes in a format specified by the secretary of revenue and taxation which will permit a written listing to be generated.

B. The responsible official must also furnish certification in writing that the debts for which the offset claims are made are legally collectible, liquidated sums due and owing the claimant agency or due and owing a person and collectible by the claimant agency. The certification must include the name and address of the claimant agency and the manner in which each offset claim arose.

C. For each offset claim, the agency must include the following information:

1. the name of the individual;

2. the amount of offset claimed;

3. the Social Security number of the debtor;

4. the most current address available to the claimant;

5. any additional information requested by the secretary which will facilitate identification and processing of the offset claim.

D. Prior to participation in the program and each year thereafter, each claimant agency participating in the garnishment program must furnish to the Department of Revenue and Taxation by October 1:

1. a statement that the agency intends to submit offset claims for the next year;

2. the anticipated number of offset claims to be certified to the department;

3. the estimated total amount of claims due;

4. any additional information requested by the Secretary of Revenue and Taxation to facilitate the economical and efficient administration of this program.

E. The Secretary of Revenue and Taxation may establish a minimum number of offset claims which will be accepted from each claimant agency.

F. The Secretary of Revenue and Taxation will determine the date each agency will be required to furnish the listing of offset claims.

G. The Secretary of Revenue and Taxation will determine the frequency and method of making remittances to the claimant agency.

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:299.4.

HISTORICAL NOTE: Promulgated by the Department of Revenue and Taxation, Income and Corporation Franchise Taxes Section, LR 10:804 (October 1984).

A. Nonresident individuals may carry back or carry over Louisiana net operating losses. Louisiana net operating losses may be carried and used in the same manner that would be allowed for federal purposes if the nonresident individual's federal returns consisted of only the Louisiana items of income and loss.

B. Application

1. The years to which Louisiana net operating losses may be carried are the same as they are for federal personal income tax purposes.

2. Net operating loss carrybacks and carryovers are considered an adjustment to Louisiana income and must be applied against total Louisiana income before applying any deductions.

C. Limitations

1. A Louisiana net operating loss carryback or carryover cannot include any amount that has already been deducted for Louisiana purposes.

2. Nothing in this Section authorizes a federal income tax deduction for income that did not bear Louisiana personal income tax.

D. Documentation for claiming the deduction

1. When a year produces a Louisiana net operating loss, a pro forma Federal Form 1040 showing how the Louisiana NOL was calculated must be attached to the return at the time of filing.

2. When a net operating loss carryback or carryover is used you must mark the “NOL” box on the face of the return and the following documentation must be attached to the return at the time of filing:

a. a schedule showing:

i. the taxable year in which each loss that is being carried back or carried over occurred; and

ii. the amount of each loss applied to each taxable year to which it was carried over or carried back.

b. a pro forma Federal Form 1040 showing the utilization of the Louisiana net operating loss; and

c. a pro forma Federal Form 1040 for the year producing the Louisiana net operating loss if it was not provided for the year in which it was produced.

3. When federal law provides for the carryback of a net operating loss:

a. If an amended return is being filed to carryback a Federal net operating loss, you must mark the “Amended Return” box on the face of the return and attach an explanation of the change and a copy of the federal amended return, Federal Form 1040X, or Federal Form 1045 whichever was filed.

b. If an amended return is being filed to carryback a federal and Louisiana net operating loss, you must mark the “Amended Return” and “NOL” box on the face of the return; attach the schedule required by Subparagraph (2)(a) of this Subsection, a copy of the federal amended return, Federal Form 1040X or Federal Form 1045 whichever was filed; and a pro forma Federal Form 1040 to show how the Louisiana net operating loss was utilized.

4. The accrual of interest shall be suspended during any period of time that a delay in the issuance of a refund is attributable to the taxpayer’s failure to provide information or documentation required herein, as provided by R.S. 47:1624(F).

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:293, R.S. 47:295, and R.S. 47:1511.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Policy Services Division, LR 28:101 (January 2002), amended by the Department of Revenue, Tax Policy and Planning Division, LR 50:1859 (December 2024).

A. The income of an enrolled member of a federally recognized Indian tribe residing on that tribe' reservation that is derived from sources on that reservation shall be exempted from Louisiana individual income tax. The determination of the sources of gross allocable income shall be consistent with R.S. 47:243.

B. The income of an enrolled member of a federally recognized Indian tribe residing on that tribe's reservation that is derived from sources outside of that reservation is taxable for Louisiana individual income tax purposes. This includes income derived from sources outside of the state.

C. The income of an enrolled member of a federally recognized Indian tribe residing in Louisiana off of that tribe's reservation is taxable for Louisiana individual income tax purposes regardless of source.

D. If an enrolled member of a federally recognized Indian tribe resides on that tribe's reservation for a portion of the year and resides off of that tribe's reservation for a portion of the year such enrolled member shall be taxed based upon where such enrolled member resided when the income in question was earned.

E Compensation from military sources paid to an enrolled member of a federally recognized Indian tribe shall be exempted from Louisiana individual income tax if:

1. such enrolled member was residing on that tribe's reservation at the time of entering the armed forces of the United States; and

2. such enrolled member has not elected to abandon his or her residence on that tribe's reservation.

AUTHORITY NOTE: Adopted in accordance with R.S. 47:293(6)(a)(iii) and R.S. 47:295.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Policy Services Division, LR 27:2261 (December 2001).

A. For purposes of this Section, nonresident means any individual not domiciled, residing in, or having a permanent place of abode in Louisiana.

B. Nonresidents are taxed on all income from sources within Louisiana. Income from sources within Louisiana includes compensation for personal services rendered within Louisiana.

C. The purpose of this rule is to apportion to Louisiana, in a fair and equitable manner, a nonresident's total compensation for personal services performed in the state. It is presumed that application of the provisions of this rule will result in a fair and equitable apportionment of that compensation.

1. When the department demonstrates that the method provided under this rule does not fairly and equitably apportion that compensation, the department may require the nonresident service provider to apportion that compensation under an alternative method the department prescribes, as long as the prescribed method results in a fair and equitable apportionment.

2. If a nonresident service provider demonstrates that the method provided under this rule does not fairly and equitably apportion compensation, the nonresident may submit a proposal for an alternative method to apportion compensation. If approved, the proposed method must be fully documented and explained in the nonresident service provider's nonresident personal income tax return for the state.

3. Nonresident service providers shall keep adequate records to substantiate their determination or to permit a determination by the department of the part of their adjusted gross income that was derived from or connected with sources in this state.

D. Compensation of Salaried Employees with a Constant Rate of Pay. The Louisiana income from personal services is the proportion of total compensation from services rendered, which the total number of working days in the state bears to the total number of working days both within and without the state.

1. The total number of working days is determined by subtracting all nonworking days from the total number of days in the year or contract period, if the contract period is less than a year.

2. Nonworking days include, but are not limited to, Saturdays and Sundays not worked, holidays, days off for religious observance, days of absence due to illness or personal injury, vacation days, days of leave without pay, days off for any personal reason, and sabbatical days.

3. Days spent in travel, if the travel is at the direction of the employer, are considered working days even if the travel is on a day that would usually be considered a nonworking day.

E. Compensation Based on Volume of Business. The Louisiana income from commissions earned by a nonresident traveling salesman, agent or other employee for services performed or sales made, whose compensation depends directly on the volume of business transacted by him, includes that proportion of the compensation received which the volume of business transacted by such employee within Louisiana bears to the total volume of business transacted by him within and without the state.

F. Compensation from Continuous Employment in Louisiana for Part of the Year. If a nonresident employee (including officers of corporations, but excluding employees, mentioned in Subsection D above) is employed continuously in this state for a definite portion of any taxable year, that employee's Louisiana income includes the total compensation for the period employed in this state.

G. Compensation from Transportation Services. If a nonresident employee is employed in this state at intervals throughout the year, as would be the case if employed in operating trains, boats, planes, motor buses, trucks, etc., between this state and other states and foreign countries, and is paid on an hourly, daily, weekly or monthly basis, that employee's Louisiana income includes that portion of the total compensation for personal services which the total number of working days, as defined in Subsection C above, employed within the state bears to the total number of working days both within and without the state. If the employee is paid on a mileage basis, that employee's Louisiana income includes that portion of the total compensation for personal services which the number of miles traversed in Louisiana bears to the total number of miles traversed within and without the state. If the employee is paid on some other basis, the total compensation for personal services must be apportioned between this state and other states and foreign countries in such a manner as to allocate to Louisiana that portion of the total compensation which is reasonably attributable to personal services performed in this state. This Subsection is not intended to attribute to Louisiana any income that is exempted from state taxation by federal law.

H. Compensation of Nonresident Entertainers and Athletes Who Are Not Members of a Professional Athletic Team. Compensation earned by a nonresident entertainer is considered earned where the services are performed, regardless of where the nonresident entertainer lives, enters into the contract, or receives payment. Entertainers include, but are not limited to, actors, singers, musicians, performers, and professional athletes who are not members of a professional athletic team.

1. Entertainers must include the gross amount received for performances in this state in their Louisiana income.

2. Ordinary and necessary business expenses directly attributable to the income earned in Louisiana and a pro-rata share of indirect business expenses not directly attributable to income from any particular source are "adjustments to income." These "adjustments to income" are subtracted from Louisiana income to arrive at "total Louisiana income."

I. Nonresident Athletes Who Are Members of a Professional Athletic Team

1. The Louisiana income of a nonresident individual who is a member of a professional athletic team includes that portion of the individual's total compensation for services rendered as a member of a professional athletic team during the taxable year which, the number of duty days spent within the state rendering services for the team in any manner during the taxable year, bears to the total number of duty days spent both within and without the state during the taxable year.

2. Definitions. These terms are defined as follows. Unless otherwise indicated, these definitions apply only to this Subsection.

Duty Days―all days during the taxable year from the beginning of the professional athletic team's official preseason training period through the last game in which the team competes or is scheduled to compete.

i. Duty days shall also include days on which a member of a professional athletic team renders a service for a team on a date that does not fall within the period described in the general definition of duty days above, for example, participation in instructional leagues, the Pro Bowl, or other promotional caravans. Rendering a service includes conducting training and rehabilitation activities, but only if conducted at the facilities of the team.

ii. Included within duty days shall be game days, practice days, days spent at team meetings, promotional caravans, and preseason training camps, and days served with the team through all postseason games in which the team competes or is scheduled to compete.

iii. Duty days for any person who joins a team during the season shall begin on the day that person joins the team, and for a person who leaves a team shall end on the day that person leaves the team. If a person switches teams during a taxable year, a separate duty day calculation shall be made for the period that person was with each team.

iv. Days for which a member of a professional athletic team is not compensated and is not rendering services for the team in any manner, including days when the member of a professional athletic team has been suspended without pay and prohibited from performing any services for the team, shall not be treated as duty days.

v. Days for which a member of a professional athletic team is on the disabled list shall be presumed not to be duty days spent in the state. They shall, however, be included in total duty days spent within and without the state.

vi. Travel days that do not involve either a game, practice, team meeting, promotional caravan or other similar team event are not considered duty days spent in the state, but shall be considered duty days spent within and without the state.

Member of a Professional Athletic Team―shall include those employees who are active players, players on the disabled list, and any other persons required to travel and who do travel with and perform services on behalf of a professional athletic team on a regular basis. This includes, but is not limited to, coaches, managers, and trainers.

Professional Athletic Team―includes, but is not limited to, any professional baseball, basketball, football, soccer, or hockey team.

Total Compensation―includes salaries, wages, bonuses, and any other type of compensation paid during the taxable year to a member of a professional athletic team for services performed in that year.

i. Total compensation shall not include strike benefits, severance pay, termination pay, contract or option-year buyout payments, expansion or relocation payments, or any other payments not related to services rendered to the team.

ii. For purposes of this rule, "bonuses" subject to the allocation procedures described in this Subsection, are:

(a). bonuses earned as a result of play during the season, including performance bonuses, bonuses paid for championship, playoff or bowl games played by a team, or for selection to all-star league or other honorary positions; and

(b). bonuses paid for signing a contract, unless all of the following conditions are met:

(i). the payment of the signing bonus is not conditional upon the signee playing any games for the team, or performing any subsequent services for the team, or even making the team;

(ii). the signing bonus is payable separately from the salary and any other compensation; and

(iii). the signing bonus is nonrefundable.

Total Compensation for Services Rendered as a Member of a Professional Athletic Team―the total compensation received during the taxable year for services rendered:

i. from the beginning of the official preseason training period through the last game in which the team competes or is scheduled to compete during that taxable year; and

ii. during the taxable year on a date that does not fall within the period in Clause i. above, for example, participation in instructional leagues, the Pro Bowl, or promotional caravans.

J. Nothing in this regulation shall restrict the secretary's authority to otherwise provide for efficient administration of the individual income tax.

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:290, R.S. 47:293, R.S. 47:295, and R.S. 47:1511.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Policy Service Division LR 28:99 (January 2002), amended LR 48:507 (March 2022).

A. If the Louisiana income tax of a nonresident professional athlete or professional sports franchise is attributable to the Sports Facility Assistance Fund, created by R.S. 39:100.1, the following schedule must be attached to any income tax return filed, including individual, corporate, fiduciary, or trust income tax returns. Each nonresident professional athlete and professional sports franchise with Louisiana source income must attach a schedule to the required Louisiana income tax return that includes the following information:

1. the name of each facility, course, stadium, or arena at which they earned income in Louisiana;

2. the location of each facility, course, stadium, or arena at which they earned income in Louisiana; and

3. the number of duty days, as defined in LAC 61:I.1304.I, spent at each facility, course, stadium, or arena at which they earned income in Louisiana.

B. For purposes of this Section only, these terms are defined as follows.

Professional Athlete—an athlete that either plays for a professional sports franchise or who is a member of a professional sports association or league.

Professional Sports Association or League—any of the following:

a. Professional Golfers Association of America;

b. National Football League;

c. National Basketball Association;

d. National Hockey League;

e. East Coast Hockey League;

f. Pacific Coast League.

Professional Sports Franchise—a member team of a professional sports association or league.

C. Effective for tax years beginning on or after January 1, 2021, nonresident professional athletes, if required to file an individual income tax return, must utilize the Louisiana Nonresident Return, Form IT-540B and attach Schedules NRPA-1 and NRPA-2.

D. Penalty for Failure to Timely Remit Returns, Schedules and Payments

1. The following penalties based on R.S. 47:1602.1 will be imposed for failure to timely remit these returns, schedules, and payments.

a. In the case of failure to timely make and file any return or schedule required by the secretary to administer the provisions of the Sports Facility Assistance Fund, the penalty shall be $500 for the first such failure, $1,000 for the second such failure within the three-year period beginning on the due date of the first delinquent return or schedule, and $2,500 for each subsequent failure within the three-year period beginning on the due date of the first delinquent return or schedule.

b. In the case of failure to timely remit any payment required by the secretary to administer the provisions of the Sports Facility Assistance Fund, the penalty shall be 5 percent of the total payment due if the delinquency is for not more than 30 days, with an additional 5 percent for each additional 30 days or fraction thereof during which the delinquency continues, not to exceed 50 percent of the amount due.

E. Based on R.S. 47:1604.1, any taxpayer who fails to comply with the tax laws of this state or understates tax liability by ten percent or more, under circumstances indicating a careless or reckless disregard of rules and regulations, but with no voluntary intent to defraud, may cause a penalty to be imposed, in addition to any other penalties provided, of 20 percent of the tax or deficiency found to be due.

1. The penalty provided for pursuant to this Paragraph shall not be applicable if a taxpayer's understatement was due to reasonable cause where the taxpayer acted in good faith.

AUTHORITY NOTE: Promulgated in accordance with R.S. 39:100.1, R.S. 47:101(A)(3), R.S. 47:295, R.S. 47:1511, R.S. 47:1602.1, and R.S. 47:1604.1.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Policy Services Division, LR 28:98 (January 2002), amended LR 34:446 (March 2008), amended LR 48:507 (March 2022).

A. The claimant must submit a written offset claim with a certified copy of the judgment that makes past-due payments under a child-support award executory. The claim must be submitted before participation in the program and by December 1 each year thereafter. After the first year of participation, a copy of the claim and judgment can be submitted if the information requested in Subsection B has not changed.

B. For each offset claim, the claimant must provide the following information:

1. the name of the debtor;

2. the amount of offset claimed;

3. the Social Security number of the debtor;

4. the most current address of the debtor available to the claimant; and

5. any additional information requested that will facilitate identification of the debtor and processing of the offset claim.

C. Remittances will be made to the claimant within three months after the debtor has waived the right to contest the offset or final disposition by the claimant or by a court.

D. A fee for processing the claim will be withheld from each refund issued.

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:299.34.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Policy Services Division, LR 29:42 (January 2003).

A. Louisiana Revised Statutes 47:44.1 provides an exemption of up to $6,000 for annual retirement income received by an individual who is 65 years of age or older. Only the individual who actually received the annual retirement income is entitled to the exemption.

Annual Retirement Income―pension and annuity income which is included in tax table income.

Tax Table Income―as defined in R. S. 47:293.

B. For purposes of determining the total annual retirement income exemption that can be claimed on a Louisiana individual income tax return, an individual receives annual retirement income as follows.

1. Receipt of Benefits Paid from a Pension Plan. Except as otherwise provided herein, only the plan participant receives annual retirement income from the pension plan, the non-participant spouse does not receive annual retirement income from the plan.

2. Receipt of Annuity Income. Only the named payee or named annuitant receives annual retirement income from an annuity.

3. Receipt of Income from an Individual Retirement Account. Only the named payee or distribute receives annual retirement income from an individual retirement account.

4. Exceptions

a. If there is a qualified domestic relations order, as defined in Internal Revenue Code Section 414(p), payments received by the alternate payee will be considered annual retirement benefits received by an individual.

b. Survivor benefits paid from a pension plan to the plan participant's surviving spouse will be considered annual retirement benefits received by an individual.

C. Examples

1. Mary and John are a married couple. Mary worked for X Corporation for 35 years from 1964 until she retired in 1999. While working for X Corporation, Mary participated in the corporation's pension plan. In 2005, Mary received a total of $30,000 in distributions from the X Corporation pension plan. John's only source of retirement income is federal Social Security, which is not included in the couple's tax table income because it is already exempt under R.S. 47:44.2. Mary and John's filing status for federal and state income tax is married filing joint and they are both over 65. Because only Mary receives annual retirement income, Mary and John may only exempt $6,000 of Mary's retirement income from their 2005 income taxes under this exemption. Because John is not the plan participant, he has not received any annual retirement income for purposes of the exemption.

2. Scott and Ellen are a married couple. Their filing status for federal and state income tax is married filing joint and they are both over 65. Because they are both 65 years of age or older, each of them is entitled to exempt up to $6,000 of the annual retirement income each of them receive. Scott worked for ABC Corporation for 35 years from 1964 until he retired in 1999 at the age of 65. While working for ABC Corporation, Scott participated in the corporation's pension plan. In 2005, Scott received a total of $30,000 in distributions from the ABC Corporation pension plan. Ellen has two sources of retirement income; federal Social Security that is already exempt under R.S. 47:44.2 and an annuity paid to her as the named annuitant in the amount of $4,000 annually. Scott may exempt $6,000 of his ABC Corporation pension income and Ellen may exempt all of her $4,000 annuity income for a combined exemption of $10,000.

3. Alan and Leslie are a married couple who do not live apart. Their filing status for federal and state income tax is married filing separate and they are both over 65. Because they are both 65 years of age or older, each of them is entitled to exempt up to $6,000 of the annual retirement income each of them receive on their married filing separate returns. Alan is the named annuitant of an annuity from which he receives annual retirement income of $10,000. Leslie is not yet retired and receives a salary, but no annual retirement income. Alan's annuity income and Leslie's salary are community property. Because Louisiana is a community property state and the couple has chosen not to file a joint return, Leslie must report one half of Alan's annuity income, or $5,000, on her married filing separate federal and state income tax returns. Because Leslie is not the named annuitant, she has not received annual retirement income for purposes of the exemption and cannot claim any exemption amount on her return. Because Alan is only reporting $5,000 of his annuity income on his federal and state income tax returns, he is only entitled to an exemption of $5,000.

4. Assume the same facts as in Example 3 except that Alan and Leslie have a separation of property agreement. Each spouse will therefore report his or her own items of income and loss on his or her own married filing separate return. Alan will report the entire amount of his annuity income and will be entitled to exempt $6,000 of the $10,000 of annual retirement income he receives.

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:44.1, R.S. 47:295, and R.S. 47:1511.

HISTORICAL NOTE: Promulgated by the Department of Revenue, LR 32:259 (February 2006).

A. General. R.S. 47:293(9)(a)(xvii) and (10) provide a deduction for resident individuals and nonresident individuals (“taxpayers”), respectively, for net capital gains resulting from the sale or exchange of an equity interest in, or from the sale or exchange of substantially all of the assets of a non-publicly traded corporation, partnership, limited liability company, or other business organization (“business”) commercially domiciled in Louisiana.

B. Definitions

Capital Gains from the Sale or Exchange of the Assets of a Business—capital gains from sales and exchanges that are reported on Federal Form 4797–Sales of Business Property, the gains from which are reportable on Schedule D of Federal Form 1040.

Commercial Domicile—the principal place from which the business is directed or managed.

Controlled Entities—with respect to a business or taxpayer

a. a corporation in which more than 50 percent of the value of the outstanding stock is owned (directly or indirectly) by or for the taxpayer or business,

b. a partnership in which more than 50 percent of the capital interest or profits interest is owned (directly or indirectly) by or for the taxpayer or business, and

c. any entity which is a related person to the taxpayer or business pursuant to paragraph (3), (10), (11), or (12) of 26 U.S.C § 267(b).

Equity Interest—an ownership interest in a business that is not publicly traded, such as stock in a corporation, a partnership interest in a partnership, or a membership interest in a limited liability company.

Net Assets—the total value of gross assets after deducting liabilities reportable or would be reportable on the Federal Form 1120, Schedule L if the form was required to be filed at time of sale as total assets at the end of the year.

Net Capital Gains—the amount reported as capital gains on the Federal Form 1040.

Gross Assets—the total value of assets reportable or would be reportable on the Federal Form 1120, Schedule L if the form was required to be filed at time of sale as total assets at the end of the year without regard to location of the assets and excluding any negative values reported on Lines 1-13.

Related Party—

a. a business or taxpayer and all entities which are controlled entities with respect to such business or taxpayer;

b. a business or taxpayer and any trust in which such business or taxpayer (or his spouse) is a beneficiary, unless such beneficiary’s interest in the trust is five percent or less of the value of the trust property; and

c. except in the case of a sale or exchange in satisfaction of a pecuniary bequest, a taxpayer who is an executor of an estate and a beneficiary of such estate.

Sale or Exchange of an Equity Interest—a sale or exchange of an equity interest that is reportable on Schedule D of Federal Form 1040–Capital Gains and Losses.

Sale or Exchange of Substantially all of the Assets of a Business—a sale or exchange of assets that leaves the entity unable to carry-on its business. A sale or exchange of assets is presumed to be a sale or exchange of substantially all of the assets of the business if the selling business transfers at least 90 percent of the fair market value of the net assets and at least 70 percent of the fair market value of the gross assets that it held immediately before the transfer.

C. Documentation Requirements

1. Taxpayers claiming the deduction shall submit the following documentation at the time of filing their Louisiana individual income tax return claiming the deduction:

a. a completed Louisiana Form R-6180, Net Capital Gains Deduction Worksheet;

b. documentary evidence of the date the taxpayer acquired an equity interest in the business, such as articles of incorporation or organization, acts of sale or exchange, or donative instruments;

c. a copy of the taxpayer’s federal Schedule K-1, if applicable, from the entity from which the gain was derived; and

d. a complete copy of the taxpayer’s Federal Form 1040 filed with the IRS for the period in which the gain was recognized, including the Schedule D and any corresponding schedules and forms.

2. In addition to the documentation required by Paragraph 1 above, when the capital gain for which a deduction is being claimed is greater than $250,000, taxpayers shall also submit the following at the time of filing their Louisiana individual income tax return claiming the deduction:

a. copies of the last two returns on which the income from the business was reported. If the gain is derived from a partnership, provide Form IT-565, Louisiana Partnership Return of Income, for the last two years.

b. If the gain is derived from a pass-through entity, provide detailed information on the pass-through structure, such as a complete organizational chart showing each tier between the taxpayer and the entity from which the gain is derived.

c. If the gain is from the sale of assets, the taxpayer shall also provide the following:

i. a depreciation schedule or fixed asset schedule showing a calculation of gross to net asset values; and

ii. an allocation of purchase price among assets as required by IRC Section 1060, and generally reportable on IRS Form 8594.

D. Eligibility Restrictions

1. Net capital gains resulting from the sale or exchange of real property or other immovable assets may qualify for the deduction if more than 50 percent of the real property or other immovable assets are located within Louisiana, provided however, that the income from the related business was subject to Louisiana income tax prior to the sale or exchange.

2. Net capital gains resulting from the sale or exchange of tangible movable assets may qualify for the deduction if during the three years immediately preceding the sale or exchange, the tangible movable assets are located within Louisiana for at least 50 percent of the time in which the assets are in service, provided however, that the income from the related business was subject to Louisiana income tax prior to the sale or exchange. “In service” shall have the same meaning as it does for the purposes of calculating depreciation.

3. Net capital gains from the sale or exchange of an equity interest or from the sale or exchange of substantially all assets shall not qualify for the deduction if the transaction transfers ownership of the interest or assets to a related party.

E. The accrual of refund interest shall be suspended during any period of time that a delay in allowance or approval of the deduction is attributable to the taxpayer’s failure to provide information or documentation required herein.

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:293(9)(a)(xvii) and (10), 47:293.2 and 47:1511.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Tax Policy and Planning Division, LR 50:1673 (November 2024).

A. An individual's hunting and fishing licenses will be suspended, revoked, or denied if the Department of Revenue has a final and nonappealable individual income tax assessment or judgment against the individual in excess of $500 exclusive of penalty, interest, costs, and other charges.

B. Exceptions

1. If the taxpayer has filed for bankruptcy, then the provisions of this regulation will not apply.

2. An assessment or judgment will not be considered final and nonappealable for purposes of this regulation if, for the applicable tax period:

a. the taxpayer is in litigation with the department;

b. the taxpayer is being audited by the department; or

c. correspondence is pending.

C. Responsibilities

1. The Department of Revenue is responsible for the following:

a. properly identifying the affected taxpayer;

b. accurately notifying the Department of Wildlife and Fisheries of the taxpayer's identity; and

c. timely notifying the Department of Wildlife and Fisheries if the taxpayer pays the assessment or judgment and regains eligibility for a hunting or fishing license.

2. The Department of Wildlife and Fisheries is responsible for the following:

a. suspending, revoking or denying hunting and fishing licenses once notified of a taxpayer's identity by the Department of Revenue; and

b. issuing or re-issuing hunting and fishing licenses to taxpayers who have paid their tax debts once notified of this fact by the Department of Revenue.

D. Taxpayer Notification

1. Before the notice of hunting and fishing licenses suspension, revocation, or denial is sent to the Department of Wildlife and Fisheries, the taxpayer will be mailed written notice.

2. The notice will inform the taxpayer that his hunting and fishing licenses will be suspended, revoked, or issuance denied until full payment of the final and nonappealable assessment or judgment is made or until the taxpayer enters into an installment agreement with the Department of Revenue.

3. The notice will be mailed to the address on record and it will be presumed that the taxpayer has received the notice if it is not returned as "Undeliverable."

4. If a taxpayer defaults on a department authorized installment payment plan, no further notice of suspension, revocation, or denial of the issuance of the taxpayer's hunting and fishing licenses will be required.

E. Notification to the Department of Wildlife and Fisheries

1. The Department of Revenue will notify the Department of Wildlife and Fisheries of the name, Social Security number, and address of the taxpayer for whom the hunting and fishing licenses are required to be suspended, revoked, or issuance denied.

2. The suspension and revocation will remain in effect until the Department of Wildlife and Fisheries is notified otherwise by the Department of Revenue.

3. The Department of Revenue will notify the Department of Wildlife and Fisheries of the name, Social Security number, and address of the taxpayer for whom the hunting and fishing licenses are to be issued or re-issued.

4. Notifications may be by secured electronic transmission or by magnetic tapes, cartridges, or other electronic media.

5. Notifications will be made weekly unless circumstances warrant a more frequent time schedule, such as the circumstances described in Subsection E.

F. If the taxpayer pays the assessment or judgment in person, notice will be given to the Department of Wildlife and Fisheries to remove the suspension, revocation, or denial of the taxpayer's hunting and fishing licenses from their records. Notice to the Department of Wildlife and Fisheries will be effected as follows:

1. Department of Revenue personnel may fax a clearance to the Department of Wildlife and Fisheries indicating that the assessment or judgment has been paid; or

2. a letter from the secretary or the secretary's designee indicating that the assessment or judgment has been paid may be issued to the taxpayer for presentation to the Department of Wildlife and Fisheries.

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:296.3 and 1511.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Policy Services Division, LR 30:1045 (May 2004).

A. An individual's driver's license will be suspended and the renewal denied if the Department of Revenue has a final and nonappealable individual income tax assessment or judgment against the individual in excess of $1,000 exclusive of penalty, interest, costs, and other charges.

B. Exceptions

1. If the taxpayer has filed for bankruptcy, then the provisions of this regulation will not apply.

2. An assessment or judgment will not be considered final and nonappealable for purposes of this regulation if, for the applicable tax period:

a. the taxpayer is in litigation with the department;

b. the taxpayer is being audited by the department; or

c. correspondence is pending.

C. Responsibilities

1. The Department of Revenue is responsible for the following:

a. properly identifying the affected taxpayer;

b. accurately notifying the Department of Public Safety and Corrections, Office of Motor Vehicles, of the taxpayer's identity; and

c. timely notifying the Department of Public Safety and Corrections, Office of Motor Vehicles, if the taxpayer pays the assessment or judgment and regains eligibility for a driver's license.

2. The Department of Public Safety and Corrections, Office of Motor Vehicles, is responsible for the following:

a. suspending or denying the renewal of a driver's license once notified of a taxpayer's identity by the Department of Revenue; and

b. issuing or renewing drivers' licenses to taxpayers who have paid their tax debts once notified of this fact by the Department of Revenue.

D. Taxpayer Notification

1. The Department of Revenue must notify the taxpayer before the notice of driver's license suspension or denial is sent to the Department of Public Safety and Corrections, Office of Motor Vehicles.

a. The notice will inform the taxpayer that their driver's license will be suspended or renewal denied until full payment of the final and nonappealable assessment or judgment is made or until the taxpayer enters into an installment agreement with the Department of Revenue.

b. The notice will be mailed to the address on record.

2. If, after notification, a taxpayer enters into an installment agreement with the Department of Revenue and later defaults on the agreement, no further notice to the taxpayer by the Department of Revenue will be required and the notice of driver's license suspension or denial will be sent to the Department of Public Safety and Corrections, Office of Motor Vehicles.

E. Notification to the Department of Public Safety and Corrections, Office of Motor Vehicles

1. The Department of Revenue will notify the Department of Public Safety and Corrections, Office of Motor Vehicles, of the name, driver's license number, and date of birth of the taxpayer for whom the driver's license is required to be suspended or renewal denied.

2. The suspension and denial will remain in effect until the Department of Public Safety and Corrections, Office of Motor Vehicles, is notified otherwise by the Department of Revenue.

3. The Department of Revenue will notify the Department of Public Safety and Corrections, Office of Motor Vehicles, of the name, driver's license number, and date of birth of the taxpayer for whom the driver's license is to be issued or renewed.

4. Notifications may be by secured electronic transmission or by magnetic tapes, cartridges, or other electronic media.

5. Notifications will be made weekly unless circumstances warrant a more frequent time schedule, such as the circumstances described in Subsection F.

F. If the taxpayer pays the assessment or judgment in person, notice will be given to the Department of Public Safety and Corrections, Office of Motor Vehicles, to remove the suspension or denial of the renewal of the taxpayer's driver's license from their records. Notice to the Department of Public Safety and Corrections, Office of Motor Vehicles, will be effected by the presentation of a letter from the secretary or the secretary's designee to the Office of Motor Vehicles indicating that the assessment or judgment has been paid.

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:296.2 and 47:1511.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Policy Services Division, LR 30:2330 (October 2004).

A. General Description

1. The Digital Nomads Exemption provides a state individual income tax exemption for digital nomads, as defined by R.S. 47:297.18, equal to 50 percent of their gross wages, limited to $150,000, for a period of up to two taxable years during taxable years 2022, 2023, 2024, and 2025.

2. The exemption applies only to gross wages received for remote work performed as a digital nomad in Louisiana.

B. Definitions. For the purposes of this Section, the following terms shall have the meaning ascribed therein.

Coworking Space—a membership-based workspace where diverse groups of freelancers, remote workers, and other independent professionals work together in a shared, communal setting.

Department—the Louisiana Department of Revenue or its successor.

Employee—as defined in R.S. 47:111(A).

Employer—as defined in R.S. 47:111(B).

Full-Time Remote Worker—a remote worker employed on average for at least 30 hours of remote service per week.

Nonresident Business—any business entity that has not filed nor is required to file any state tax return in Louisiana for taxable periods beginning on or after January 1, 2021; has no employees other than those who qualify as digital nomads working remotely, agents, or independent contractors within the state; is not registered to do business in the state; and is not transacting business with residents of the state or otherwise availing itself of Louisiana’s economic market.

Remote Work Agreement—an agreement signed by the employer and the participating employee that defines the terms of a remote working arrangement, including the number of days per year the participating employee will work remotely and any restrictions on the place from which the participating employee will work remotely.

Remote Work—work performed within the ordinary course and scope of employment on a workday that ordinarily would be performed at the employer’s work location, from an approved worksite other than the employer’s work location.

C. Eligibility

1. To qualify as a digital nomad for the purposes of this exemption, an individual must meet the following criteria:

a. establish residency in Louisiana after December 31, 2021;

b. be a policyholder, subscriber, enrollee, or other individual enrolled in or insured by a health insurance issuer for major medical health insurance coverage;

c. work remotely full-time for a nonresident business;

d. must have the intent to work remotely in Louisiana prior to establishing residency;

e. must file a Louisiana resident or part-year resident individual income tax return for the taxable year in which they are claiming the exemption;

f. must not have been a resident or domiciliary of Louisiana for any of the three years immediately preceding the establishment of residency or domicile after December 31, 2021;

g. must not have been required to file a Louisiana resident or part-year resident individual income tax return for any of the three years prior to claiming the exemption and;

h. performs the majority of employment duties in Louisiana either remotely or at a co-working space.

2. Any nonresident service member of the Armed Forces of the United States of America and any spouse of a nonresident service member of the Armed Forces of the United States of America who meets the eligibility requirements of Paragraph 1 of this Subsection may qualify for the digital nomads exemption if:

a. the nonresident service member is present in Louisiana in compliance with the nonresident service member’s military orders;

b. the spouse is not a resident or domiciliary of Louisiana; and

c. the spouse is present in Louisiana solely to be with the nonresident service member.

3. Illustrative Examples. For each of the examples below, it shall be assumed that the eligibility requirements of Paragraph 1 of this Subsection have been met unless otherwise stated and the taxpayer continues qualifying employment for the second consecutive year.

a. A nonresident taxpayer working remotely full-time for a nonresident business relocates to and establishes residency in Louisiana on January 15, 2023, and continues to work remotely for the same nonresident business. The taxpayer will qualify for the income exemption for digital nomads for tax year 2023.

b. A nonresident taxpayer working remotely full-time for a nonresident business relocates to and establishes residency in Louisiana on January 15, 2023, and continues to work remotely for the same nonresident business. However, the taxpayer failed to timely apply for the exemption. The taxpayer does not qualify for the income exemption for digital nomads for the second year because he was required to file a Louisiana resident or part-year resident individual income tax return for tax year 2023.

c. A nonresident taxpayer working remotely full-time for a nonresident business relocates to Louisiana on March 24, 2023, solely to reside with their spouse who is a nonresident member of the Armed Forces of the United States of America stationed in Louisiana. The nonresident taxpayer continues to work remotely for the same nonresident business. The taxpayer will qualify for the income exemption for digital nomads for tax year 2023.

d. A nonresident taxpayer working remotely full-time for nonresident business “A” relocates to and establishes residency in Louisiana on May 23, 2023. The taxpayer terminates employment with nonresident business “A” on July 2, 2023, and begins full-time remote employment with nonresident business “B” on July 3, 2023. The taxpayer will qualify for the income exemption for digital nomads for tax year 2023.

e. A nonresident taxpayer working remotely full-time for nonresident business “A” relocates to and establishes residency in Louisiana on May 23, 2023. The taxpayer terminates employment with nonresident business “A” on July 2, 2023, and begins full-time remote employment with a resident business on July 3, 2023. The taxpayer will qualify for the income exemption for digital nomads for the income earned while working for nonresident business “A” for tax year 2023. However, the taxpayer does not qualify for the exemption for the second year.

f. A nonresident taxpayer relocates to and establishes residency in Louisiana on September 22, 2023 and begins working in person full-time for a resident business. The taxpayer terminates employment with the resident business and begins full-time remote employment with a nonresident business on October 30, 2023. The taxpayer does not qualify for the income exemption for digital nomads because he relocated to Louisiana for in-person employment with a resident business not as a remote worker for a nonresident business.

g. A nonresident, unemployed taxpayer relocates to and establishes residency in Louisiana on January 15, 2023 with an offer of employment to begin employment as full-time remote worker with a nonresident business on February 1, 2023. The taxpayer will qualify for the income exemption for digital nomads for tax year 2023.

h. A nonresident, unemployed taxpayer relocates to and establishes residency in Louisiana on January 15, 2023. Taxpayer subsequently finds and begins employment as full-time remote worker with a nonresident business on March 30, 2023. The taxpayer does not qualify for the income exemption for digital nomads because he had no intent to relocate to Louisiana to work remotely.

D. Limitations

1. The department may approve no more than 500 taxpayers for the life of the program. A taxpayer may be approved for the exemption for a second year after receiving recertification.

2. No exemption is authorized for any wages earned by a digital nomad after December 31, 2025.

E. Application

1. Beginning January 1, 2023, taxpayers seeking to claim the digital nomad income tax exemption must apply each year by submitting Form R-90006, Digital Nomad Exemption Application and Certification of Exemption Amount. This annual application requirement applies to all taxpayers, including those who are applying for recertification for their second year of eligibility.

2. The application period for calendar year 2022 shall begin on February 1, 2023 and conclude on March 31, 2023. Thereafter, the application period shall begin on February 1 and conclude on March 31 of each subsequent calendar year for the prior year. If the start or end date falls on a weekend or holiday, the date will be the next business day. Applications may not be submitted and will not be accepted prior to, or subsequent to, the application period. Eligible applications shall be approved by the department on a first-come, first-served basis as determined by the received date and time of a completed digital nomad exemption application. An application shall not be considered complete until all information requested by the department has been received.

3. Taxpayers must electronically submit Form R-90006, Digital Nomad Exemption Application and Certification of Exemption Amount to the Department for review by submitting their application to DigitalNomadExemption@La.gov. A taxpayer is approved upon satisfactorily demonstrating that they have met the requirements of Subsection C of this Section during the calendar year.

4. Only applications concerning eligibility of gross wages earned for remote work performed by a digital nomad in the prior calendar year may be submitted and considered for purposes of the exemption.

5. Each application must contain an applicant’s home mailing address, applicant’s Social Security number, a copy of the applicant’s remote work agreement, a copy of applicant’s W-2 for the year for which the application is submitted, a copy of the first and last pay stub from applicant’s employer for the year for which application is submitted, a copy of the first and last pay stub from applicant’s employer for the dates that applicant worked remotely for the year for which application is submitted, and a copy of the applicant’s Louisiana driver’s license and voter registration card.

F. Certification

1. After review and determination of qualification, the Department shall provide a copy of the completed Form R-90006 to the taxpayer no later than April 30 of each calendar year notifying them as to whether their application has been approved or denied. If approved, the form shall notify the taxpayer of the amount eligible for the exemption, not to exceed 50 percent of the taxpayer’s gross wages earned as a digital nomad, limited to $150,000. If denied, the form shall provide the reasons for denial.

G. Claiming the Exemption.

1. Resident individual taxpayers shall make a modification on Schedule E of their Louisiana Form IT-540, Louisiana Resident Income Tax Return, in accordance with La. R.S. 47:297.18. A part-year resident shall make the modification on the Nonresident and Part-Year Resident (NPR) Worksheet of the Louisiana Form IT-540B, Louisiana Nonresident and Part-Year Resident Income Tax Return.

2. The accrual of interest shall be suspended during any period of time that a delay in the issuance of a refund is attributable to the taxpayer’s failure to provide information or documentation required herein, as provided by La. R.S. 47:1624(F).

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:297.18 and R.S. 47:1511.

HISTORICAL NOTE: Promulgated by the Department of Revenue, Policy Services Division, LR 49:2112 (December 2023).