Archive for June, 2009

Report: 'House backs 15-cent charge on Internet access'

The Louisiana House of Representatives voted overwhelmingly to impose a 15-cent monthly fee on Internet access.

Rep. Mack “Bodi” White, R-Denham Springs, said he sponsored the bill for Attorney General Buddy Caldwell, to raise money to finance a division in Caldwell’s office that investigates Internet crimes, particularly online sex crimes against children.

The measure would raise $2.4 million a year for Caldwell’s department, according to a financial analysis.

“I don’t think that 15 cents per month is too much to ask for our children’s protection,” said Rep. Simone Champagne, D-Jeanerette.

While White called it a usage fee, opponents called the charge a tax on Internet access. They also have questioned whether it would violate a federal law that prohibits states from taxing Internet services and would be challenged in court.

“Today it’s Internet access. Tomorrow, what’s it going to be? A subscription to DirecTV?” said Rep. Austin Badon, D-New Orleans.

“I don’t think we should start instituting a revenue stream for every criminal element that’s out there,” he added.

The bill heads next to the Senate for debate.

Governor Jindal’s office issued a statement opposing the measure, labeling it a tax increase.

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LDR News Release – Alleged identity theft leads to tax fraud arrest

June 4, 2009

BATON ROUGE ‐ A Baton Rouge woman faces a charge related to felony tax fraud after she allegedly committed identity theft in the filing of fraudulent state income tax returns.

Baton Rouge police arrested 25‐year‐old Kathryn Foster, of 1358 North 23rd Street in Baton Rouge, on one count of Filing False Public Records. The arrest was the result of a joint investigation by the Criminal Investigations Division (CID) of the Louisiana Department of Revenue, the East Baton Rouge Parish District Attorneyʹs Office, and Baton Rouge City Police.

Investigators say Foster falsely claimed two individuals as dependents on her Louisiana State Individual Income Tax returns in 2006, 2007, and 2008.

If convicted, Foster faces up to five years in prison, a fine of up to $5,000, or both.
For more information, please contact:

Barry Kelly
Director, Criminal Investigations Division
Louisiana Department of Revenue
225.219.2280
Barry.kelly@la.gov

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Adopted Rule – Income Tax Withholding Tables

UPDATED BELOW

Under the authority of R.S. 47:32, R.S. 47:112, R.S. 47:295, and R.S. 47:1511 and in accordance with the provisions of the Administrative Procedure Act, R.S. 49:950 et seq., the Department of Revenue, Policy Services Division, amends LAC 61:I.1501 relative to individual income tax withholding tables based on the income tax rates as provided by Act 396 of the 2008 Regular Session of the Louisiana Legislature. Act 396 amended R.S. 47:32 to reduce state income tax rates in the two highest income brackets for tax years beginning on or after January 1, 2009. Act 396 provided that the revised withholding tables will not become effective until after July 1, 2009.

Read LAC 61:I.1501: Income Tax Withholding Tables.

UPDATE

Correction made to minor errors in withholding formula.

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Notice of Intent – Electronic Filing of Certain Types of Tax Returns

The Louisiana Department of Revenue proposes a rule requiring electronic filing of certain types of tax returns, beginning with the July, 2009 filing period.

Read Louisiana Administrative Code (LAC) 61:III.1513-1523: Electronic Filing Requirements – Dedicated Funds Distribution

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Revenue Information Bulletin 09-011: Natural Gas Severance Tax Rate Effective July 1, 2009

RIB 09-011:

The natural gas severance tax rate effective July 1, 2009, through June 30, 2010, has been set at 33.1 cents per thousand cubic feet (MCF) measured at a base pressure of 15.025 pounds per square inch absolute and at the temperature base of 60 degrees Fahrenheit.

This tax rate is set each year by multiplying the natural gas severance tax base rate of 7 cents per MCF by the “gas base rate adjustment” determined by the Secretary of the Department of Natural Resources in accordance with R.S. 47:633(9)(d)(i). The “gas base rate adjustment” is a fraction, of which the numerator is the average of the New York Mercantile Exchange (NYMEX) Henry Hub settled price on the last trading day for the month, as reported in the Wall Street Journal for the previous 12-month period ending on March 31, and the denominator is the average of the monthly average spot market prices of gas fuels delivered into the pipelines in Louisiana as reported by the Natural Gas Clearing House for the 12-month period ending March 31, 1990 (1.7446 $/MMBTU).

Based on this computation, the Secretary of the Department of Natural Resources has determined the natural gas severance “gas base rate adjustment” for April 1, 2008, through March 31, 2009, to be 472.82 percent. Applying this gas base rate adjustment to the base tax rate of 7 cents per MCF produces a tax rate of 33.1 cents per MCF effective July 1, 2009, through June 30, 2010. The reduced natural gas severance tax rates provided for in R.S. 47:633(9)(b) and (c) remain the same.

Revised reporting forms will be distributed as soon as they are available. Questions concerning the natural gas severance tax rate should be directed to the Taxpayer Services Division, Severance Tax Section at 225-219-7656, Option 3.

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Report: 'Tax break delay goes to House'

From The Advocate:

The Senate advanced a controversial measure Wednesday that would generate more money for higher education by delaying a tax break.

The Senate voted 29-9 in favor of sending the legislation to the House, where many lawmakers warn it will be defeated.

Senate Bill 335 by state Sen. Lydia Jackson, D-Shreveport, would freeze the amount of federal excess itemized deductions that state income tax filers can deduct at current levels through 2011. Instead of being able to claim 100 percent, tax filers would only be able to claim 65 percent.

The savings to state government would be $118 million.

Gov. Bobby Jindal is vowing to veto the legislation. Many in the House have said the bill is dead on arrival.

More…

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Louisiana Senate bars pornographers from receiving movie tax credits

From the AP:

The state Senate has voted to make pornographic movie makers ineligible for state tax credits.

Sen. A.G. Crowe, a Slidell Republican, said no porn producers have so far taken advantage of Louisiana’s economic incentive system for the film industry, but he wants to make sure that none do.

Senators agreed with a unanimous vote on Wednesday, sending the bill to the House.

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Report: 'Senate passes freeze on personal income deduction; prospects in House slim'

The Louisiana Senate voted on Wednesday to delay implementation of a expansion of an individual income tax deduction for state taxpayers.

The Senate, marking a sharp distinction from Gov. Bobby Jindal and dozens of House members, voted 29-9 today to freeze personal income tax deductions at their current level for three years in an effort to ease budget cuts for higher education.

Senate Bill 335 by Sen. Lydia Jackson, D-Shreveport, faces long odds given the majority of the lower chamber already on record in opposition and Jindal’s promised veto. But today’s vote, and the impassioned rhetoric that preceded it, made clear the significance of the ongoing budget debate, with senators focusing less on whether the measure is a tax increase and more on their insistence on finding money for colleges and universities.

“The important things that count today are the important things that count tomorrow,” said Sen. Gerald Long, R-Winnfield. “I have eight grandsons. The value of higher education in their lives cannot be underestimated.”

Sen. Ben Nevers, D-Bogalusa, said, “Sometimes we just have to be statesmen.”

The bill would leave the deduction amount at its current 65 percent, delaying the scheduled increase to a 100 percent deduction until 2012 and steering an additional $118 million to higher education.

More…

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IRS: 'Adjustments for Hurricane Grants Must Be Made by July 30th '

The Internal Revenue Service is reminding eligible homeowners who received federal reimbursement grants stemming from Hurricanes Katrina, Rita or Wilma that there is still time to take advantage of last year’s tax law change. Eligible homeowners have until July 30th to take advantage of a new law that allows homeowners to adjust previously claimed casualty loss deductions they suffered on their main home from Hurricanes Katrina, Rita or Wilma.

The Housing and Economic Recovery Act, enacted in 2008, included the new provision, aimed at helping grant recipients who previously claimed hurricane-related disaster-loss deductions. “Notice 2008-95 provides specific guidelines to homeowners who received these grants, including the Louisiana Road Home Grants and the Mississippi Development Authority Hurricane Katrina Homeowner Grants,” said IRS Spokesperson Dee Harris.

The notice explains how eligible taxpayers can amend prior-year returns to reduce the casualty loss deduction by the amount of the grant. Taxpayers have one year to pay back any resulting tax due, penalty-free and interest-free. To qualify for this relief, these amended returns must be filed by July 30, 2009, and the entire resulting tax due must be paid by July 30, 2010, in most cases.

Before this change, homeowners who claimed casualty loss deductions and received grants in a later tax year as reimbursement for the loss were required by law to pay tax on part or all of the grant to compensate for the tax benefit of the prior deduction. While individual circumstances varied, this meant that some taxpayers ended up paying more tax on the grant than they saved by claiming the deduction.

The IRS cautions that, although filing an amended return may be a good option for many, it would not necessarily be the right choice for everyone. “Affected taxpayers and their representatives should consider carefully which option is best under their particular circumstances,” advised Harris.

For more information and additional guidance, read Notice 2008-95.

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Louisiana Tax Amnesty Program – FAQs

The LDR website now hosts a list of Frequently Asked Questions about the Louisiana Tax Delinquency Amnesty Act of 2009.

The FAQ page also includes a link to the official page for House Bill 720, the legislation creating the tax amnesty program, on the homepage of the Louisiana House of Representatives. Here you can read the current text of the legislation, as well as track its legislative history.

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