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Louisiana enacts income and franchise tax changes that may require taxpayer action by June 30, 2015

On June 19, Louisiana Gov. Bobby Jindal signed several bills amending significant income and franchise tax provisions that are generally effective July 1, 2015. The bills have been enacted as part of a larger state appropriations and tax increase package. Because many of these changes apply to returns filed on or after July 1, 2015, regardless of the taxable year to which the return relates, taxpayers may want to consider filing returns prior to July 1, 2015. Specifically, the legislation eliminates the three-year net operating loss (NOL) carryback provision and extends the carryforward period from 15 to 20 years. Another piece of the legislation reduces certain exclusions and deductions from income, including the dividend exclusion, percentage depletion and the NOL deduction. Other legislation amends the inventory tax credit and R&D credit. Also, legislation amends the individual income tax credit for taxes paid to other states. Other laws reduce many corporate income tax credits and rebates. Finally, the solar energy and motion picture credits are amended. Additional tax increases are enacted for taxes other than income and franchise taxes, such as sales and use taxes and cigarette taxes. However, these latter tax changes are beyond the immediate scope of this analysis.

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