Louisiana regulations require electronic filing for income tax returns when taxpayers meet certain thresholds. Mandatory e-filing applies to:
- corporate income tax returns;
- corporation franchise tax returns;
- partnership returns; and
- fiduciary income tax returns (estates and trusts).
In addition, the e-filing rules for withholding tax statements and returns are also expanded to include information returns, such as 1099 forms.
Finally, the telecommunication tax for the deaf must be paid electronically.
Thresholds for Mandatory e-Filing
The thresholds for required e-filing are based on a taxpayer’s assets.
“Assets” mean total worldwide tangible and intangible assets as reported on Line F of Louisiana Form CIFT-620 or Form IT-565. They are also based on book value, which takes depreciation and depletion into account.
Income Tax Returns Filed by Corporations and Partnerships
For corporate income tax and partnership returns, e-filing is required if the “absolute value” of the taxpayer’s assets is at least:
- $500,000 for tax periods beginning in 2018; or
- $250,000 for tax periods beginning after 2018.
Corporate Franchise Tax Returns
For corporate franchise tax returns, e-filing is required if the “absolute value” of the taxpayer’s assets is at least:
- $500,000 for tax periods beginning in 2019; or
- $250,000 for tax periods beginning after 2019.
For fiduciary returns, e-filing is required if the return has:
- 11 or more Schedules K-1 attached for tax periods beginning in 2019; or
- one or more Schedules K-1 attached for tax periods beginning after 2019.
Absolute Value of Assets
“Absolute value” means that the threshold amount is either a positive or negative number. For example, if the threshold is $250,000, then the value of total assets can be either:
– equal to or greater than $250,000; or
– equal to or less than -$250,000.
Failure to E-file
Taxpayers required to e-file may not send paper versions of any forms to be included with their return.
The e-filing mandates apply to the taxpayer and preparers who file returns on their behalf.
Penalties for Failure to Comply
Failure to comply will result in a penalty of $100 or 5% of the tax due, whichever is greater.
The penalty can be waived if the failure to comply was not attributable to the taxpayer’s negligence.
However, if the penalty exceeds $25,000, the waiver may be subject to oversight by a legislative committee. Oversight is not required if the penalty is waived under the state’s voluntary disclosure program.
Regulations now clarify that employers must submit copies of information returns, such as federal Form 1099, to the state.
In addition, employers that file 50 or more employee withholding statements must electronically file the information returns.
EFT for Telecommunication Tax for the Deaf
All telecommunication tax for the deaf payments must now be made by electronic funds transfer. This applies to payments:
- by local or wireless telecommunications service companies operating in Louisiana; and
- beginning with the third quarter of the 2018 taxable calendar.
Payments must be made by the 30th day following the close of the reporting period.
Failure to comply with the EFT requirements will result in the payment being considered delinquent. Penalties and interest will be applied.
Delinquent penalties can be waived if the taxpayer makes a good faith attempt and exercises due diligence in initiating an EFT.
In addition, the EFT requirement can be waived it would create an undue hardship.
LAC 61:I.1515; LAC 61:III.1501, 1503, 1505, 1507, 1509 and 1530, Louisiana Department of Revenue, effective September 20, 2018