LDR Act 54; Nov 8 CA’s on ballot; IRS PPS; ERC Claims; Local OLT
October 26, 2022
LDR Issues Guidance - Tax Implications of Federal and State COVID-19 Assistance and Benefits for Individuals and Businesses
The LCPA SALT Committee ‘Act 54 Working Group’ submitted comments from member questions regarding Act 54 compliance to the Louisiana Department of Revenue (LDR). LCPA thanks Secretary Kevin Richard and Deputy Secretary Luke Morris for taking those comments into consideration.
Act 54 of the 2021 Regular Session of the Louisiana Legislature provides an individual and corporate income tax exemption for all state and federal COVID-19 relief benefits. Act 54 defines such relief benefits, in pertinent part, as “any gratuitous grant, loan, rebate, tax credit, advance refund, or other qualified disaster relief benefit directly or indirectly provided… by the state or federal government as a COVID-19 relief benefit…” if the benefit was included in the corporation’s federal gross income or the taxpayer’s federal adjusted gross income. The purpose of this ruling is to determine which relief benefits may or may not qualify for the Act 54 exemption.
- Read LDR Revenue Ruling 22-002 for full details including the many footnotes.
- Act 54 of the 2021 Regular Session
PAR Guide to the 2022 Constitutional Amendments
The Public Affairs Research Council of Louisiana (PAR) has been providing a nonpartisan review of the Constitutional Amendments since the 1970’s. The 2022 Guide covers the potential impact of the constitutional amendments the public will consider on the November 8 and December 10, 2022 ballots. This objective review helps you understand the issues and the potential changes, so you may develop your own positions on each proposition.
- The Guide is available on the PAR website.
IRS aims to eliminate ‘line cutting’ on PPS
LCPA’s Advocacy Team has advocated for the IRS to stop the robot phone calls 'line cutting' the Practitioner Priority Service. Members of the LCPA Federal Taxation Committee participate on a monthly Regional IRS Issues call and have repeatedly requested the issue be elevated as a high priority. The IRS has initiated a pilot program that requires Practitioner Priority Service callers to repeat phrases before being transferred to an IRS assistor. This pilot will use speech recognition to help ensure a live person is calling and not a mechanical device. The IRS hopes this new process will improve customer service by reducing unnecessary wait times.
ICYMI – ERC Claims Facts vs Fraud – IRS Issues Warning
The Employee Retention Credit (ERC) has created a cottage industry that is providing misleading and false information to employers. The LCPA Federal Taxation Committee met with the several IRS staff last week including the Criminal Investigation unit. The LCPA members discussed the difficult situations CPAs face when clients receive egregious communication from companies. LPCA requested IRS Criminal Investigation place an urgent priority on the issue. In order to qualify for the ERC an employer must demonstrate eligibility. This determination is where there are some very questionable positions that are taken by credit recovery companies. Kurt Oestriecher reviews important eligibility issues and breaks down the common myths and the IRS Guidance that sets the record straight.
The Internal Revenue Service recently warned employers to be wary of third parties who are advising them to claim the Employee Retention Credit (ERC) when they may not qualify. Some third parties are taking improper positions related to taxpayer eligibility for and computation of the credit.
ICYMI – Don’t forget businesses need to pay local Occupational License Tax
The local Occupational License Tax (OLT) in Louisiana is a tax imposed by ordinance levied by a parish or municipality and is due from any person or business operating within that jurisdiction. The collector may enforce collection of all taxes due. (LA R.S. 47:341)
- Read More in this LCPA Lagniappe article (member login required).
- Refer to the Louisiana Uniform Local Sales Tax Board website for a list of Louisiana OLT Jurisdictions and contact numbers.
Questions about the content of this Alert should be directed to LCPA State Government Relations Director Linda Babin.