La. Admin. Code tit. 61 § I-1669

Current through Register Vol. 50, No. 9, September 20, 2024

Section I-1669 - Use of Tax Credits

A. For tax credits earned by expenditures made on or before December 31, 2011:

1. prior to claiming a tax credit on any tax return, or transferring any tax credit, a person must apply for and obtain final certification;

2. after receiving final certification, a tax credit may be applied as follows:

a. the credit shall be allowed against the income tax due for applications submitted prior to July 1, 2009, and against the income or franchise tax due for applications submitted on or after July 1, 2009. The credit shall be allowed against the income or franchise tax due from a taxpayer for the taxable period in which the credit is earned as well as the immediately preceding period. If the tax credit allowed exceeds the amount of such taxes due from a taxpayer, then any unused credit may be carried forward by the taxpayer as a credit against subsequent tax liability for a period not to exceed 10 years. However, in no event shall the amount of the tax credit applied in a taxable period exceed the amount of such taxes due from the taxpayer for that taxable year;

b. all entities taxed as corporations for Louisiana income tax purposes shall claim any credit allowed under this section on their corporation income tax return, or in the case of applications submitted after July 1, 2009, their income and franchise tax returns;

c. individuals shall claim any credit allowed under this section on their individual income tax return;

d. entities not taxed as corporations shall claim any credits allowed under this Section on the returns of the partners or members as follows:

i. corporate partners or members shall claim their share of the credit on their corporation income tax returns;

ii. individual partners or members shall claim their share of the credit on their individual income tax returns;

iii. partners or members that are estates or trusts shall claim their share of the credit on their fiduciary income tax returns;

3. after receiving final certification, a tax credit may be transferred as follows:

a. any tax credits allocated to a person and not previously claimed by any taxpayer against his Louisiana state income or franchise tax may be transferred or sold by such person to another person, subject to the following conditions:

i. a single transfer may involve one or more transferees;

ii. transferors and transferred shall submit to the office and the Department of Revenue in writing, a notification of any transfer or sale of tax credits within 30 days after the transfer or sale of such tax credits. The notification shall include the transferor's tax credit balance prior to transfer, the state-certified production number, the name of the state-certified production, the transferor's remaining tax credit balance after transfer, all tax identification numbers for both transferor and transferee, the date of the transfer, the amount transferred, a copy of the tax credit certificate, and any other information required by the office or the Department of Revenue;

iii. failure to comply with this Paragraph will result in disallowance of the tax credit until the taxpayers are in full compliance;

iv. the transfer or sale of this credit does not extend the time in which the credit can be used. The carry forward period for credit that is transferred or sold begins on the date on which the credit was originally earned;

v. the transferee shall apply such credits in the same manner and against the same taxes as the taxpayer originally awarded the credit.

B. For tax credits earned for expenditures made on or after January 1, 2012:

1. prior to claiming a tax credit on any tax return, a person must apply for and obtain final certification;

2. after receiving final certification, a company may elect to use a tax credit as follows:

a. refund - the tax credits shall be refundable and allowed against the individual or corporate income tax liability of the companies or financiers of the project in accordance with their share of the credit as provided for in the application for certification for the project. The credit shall be allowed for the taxable period in which expenditures eligible for a credit are expended as set forth in the final tax credit certification letter. Any excess of the credit over the income tax liability against which the credit may be applied shall constitute an overpayment, as defined in R.S. 47:1621(A), and the secretary of the Department of Revenue shall make a refund of such overpayment from the current collections of the taxes imposed by Chapter 1 of Subtitle II of Title 47, as amended. The right to a refund of any such overpayment shall not be subject to the requirements of R.S. 47:1621(B); or

b. rebate - at the time of final certification of tax credits, a company may elect, on a one-time basis, to receive a rebate of the credits. The amount of the rebate shall be 85 percent of the face value of the credits. Upon receipt of the final tax credit certification letter and any necessary additional information, the secretary of the Department of Revenue shall make payment to the company, or its irrevocable designee, which may include but not be limited to a bank or other lender, in the amount to which he is entitled from the current collections of the taxes collected pursuant to Chapter 1 of Subtitle II of Title 47, as amended.

La. Admin. Code tit. 61, § I-1669

Promulgated by the Department of Economic Development, Office of Business Development, Office of Entertainment Industry Development, LR 35:634 (April 2009), amended LR 36:1984 (September 2010), LR 39:1014 (April 2013).

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:6022.