2020 Louisiana Laws
Revised Statutes
Title 47 - Revenue and Taxation
§6006.1. Tax credits for taxes paid with respect to vessels in Outer Continental Shelf Lands Act Waters

RS 6006.1 - Tax credits for taxes paid with respect to vessels in Outer Continental Shelf Lands Act Waters

A. There shall be allowed a credit against any Louisiana income or corporation franchise tax for ad valorem taxes paid to political subdivisions on vessels in Outer Continental Shelf Lands Act Waters as certified to the assessor pursuant to R.S. 47:1956(B) within the calendar year immediately preceding the taxable year of assessment of such vessel. For purposes of this Section, ad valorem taxes shall be deemed to be paid to political subdivisions when they are paid either in money or by applying credits established pursuant to R.S. 47:2132.

B. Notwithstanding anything to the contrary in either Chapter 1 or Chapter 5 of Subtitle II of this Title, as amended, the following rules shall apply with respect to the application of the credit established in Subsection A of this Section:

(1) The credit for taxes paid by or on behalf of a corporation shall be applied against Louisiana corporate income and corporation franchise taxes of such corporation. However, any such credit allowable to any member of an affiliated group of corporations, as defined in Section 1504 of the Internal Revenue Code of 1954, as amended, shall be applied against Louisiana corporate income and corporation franchise taxes of such member and any other member of such affiliated group of corporations until the entire amount of the credit has been applied against such Louisiana corporate income taxes or corporation franchise taxes.

(2) The credit for taxes paid by an individual shall be applied against Louisiana personal income taxes.

(3) The credit for taxes paid by or on behalf of a corporation classified under Subchapter S of the Internal Revenue Code of 1954, as amended, as an S corporation shall be applied first against any Louisiana corporate income and corporation franchise taxes due by such S corporation, and the remainder of any such credit shall be allocated to the shareholder or shareholders of such S corporation in accordance with their respective interests and applied against the Louisiana income tax of such shareholder or shareholders of the S corporation.

(4) The credit for taxes paid by or on behalf of a partnership shall be allocated to the partners according to their distributive shares of partnership gross income and applied against any Louisiana income tax and corporation franchise tax liability of such partners.

(5) The character of the credit for taxes paid by or on behalf of a partnership or S corporation and allocated to the partners or shareholders, respectively, of such partnership or S corporation, shall be determined as if such credit were incurred by such partners or shareholders, as the case may be in the same manner as incurred by the partnership or S corporation, as the case may be.

(6) The credit for taxes paid by an estate or trust shall be applied against the Louisiana income tax imposed on estates and trusts.

C. Notwithstanding any other provision of law to the contrary in Title 47 of the Louisiana Revised Statutes of 1950, as amended, any excess of allowable credit established by this Section over the aggregate tax liabilities against which such credit can be applied, as provided in this Section, shall constitute an overpayment, as defined in R.S. 47:1621(A), and the secretary shall make a refund of such overpayment from the current collections of the taxes imposed by Chapter 1 or Chapter 5 of Subtitle II of Title 47 of the Louisiana Revised Statutes of 1950, as amended, together with interest as provided in R.S. 47:1624. The right to a credit or refund of any such overpayment shall not be subject to the requirements of R.S. 47:1621(B). All credits and refunds, together with interest thereon, must be paid or disallowed within ninety days of receipt by the secretary, of any such claim for refund or credit. Failure of the secretary to pay or disallow, in whole or in part, any claim for a credit or a refund shall entitle the aggrieved taxpayer to proceed with the remedies provided in R.S. 47:1625.

D.(1) For the purpose of allowing the credit or refund for ad valorem taxes paid to political subdivisions as provided herein, the term "vessel" shall include ships, oceangoing tugs, towboats, and barges. The term "Outer Continental Shelf Lands Act Waters" as used herein shall have the meaning ascribed to it in R.S. 47:1702.

(2) The acceptance by the sheriff and ex officio tax collector of the ad valorem taxes paid by a taxpayer as certified under R.S. 47:1956(B) shall conclusively establish: that such property was properly classified as a "vessel", for purpose of this Section; that such vessel was "principally operated" in Outer Continental Shelf Lands Act Waters during the applicable tax year; and that such taxpayer shall be entitled to a credit or refund pursuant to this Section.

E. The credit provided in this Section shall be allowed as follows:

(1) For ad valorem taxes on Outer Continental Shelf Lands Act Waters vessels paid to political subdivisions on or after July 1, 1994, and before June 30, 1995, the credit shall be sixty percent of such taxes paid.

(2) For ad valorem taxes on Outer Continental Shelf Lands Act Waters vessels paid to political subdivisions on or after July 1, 1995, and before June 30, 1996, the credit shall be eighty percent of such taxes paid.

(3) For ad valorem taxes on Outer Continental Shelf Lands Act Waters vessels paid to political subdivisions on or after July 1, 1996, the credit shall be one hundred percent of such taxes paid.

F.(1) Nothing herein and any taxes paid by a taxpayer relative to any vessel, as defined herein, shall in any way prohibit any taxpayer from the payment of ad valorem taxes under protest or to otherwise resist the collection of such ad valorem taxes. Further, nothing in this Section shall affect, define, interpret, in whole or in part, or otherwise determine the applicability of the international trade exemption in Article VII, Section 21(C)(16) of the Constitution of Louisiana or any other applicable rights, exemptions, exclusions, preemptions, or peremptions under the Constitution of Louisiana as amended, the Constitution of the United States as amended, all treaties and executive agreements of the United States, all intrastate agreements and compacts between Louisiana and other states, all laws of Louisiana as amended, and all laws of the United States of America as amended.

(2)(a) If a taxpayer pays ad valorem taxes under protest, the taxpayer shall notify the Department of Revenue by submitting a copy of the payment under protest notice, along with a copy of the lawsuit that was filed. Notice shall be provided to the department within five business days of the date the lawsuit is filed. If the taxpayer prevails in the suit against the political subdivision, the amount of the credit issued under the provisions of this Section for ad valorem taxes paid by the taxpayer that the court determined not to be due shall be subject to recapture by the department as provided for in R.S. 47:1621(E), with interest at the rate provided in R.S. 9:3500(B)(1), except as may be otherwise provided in Subsection G of this Section. The taxpayer and the local taxing authorities shall notify the department of the decision by submitting a copy of the final, non-appealable judgment to the department.

(b) Any action by the Department of Revenue to recapture the tax credits shall be initiated within two years from the date that the department receives notice of the final judgment in the suit related to the payment of the taxes under protest.

G.(1) Notwithstanding any contrary provision of R.S. 47:2134(C), if a suit is timely filed and the sole challenge in the suit is a challenge of the legality of the ad valorem tax on vessels in Outer Continental Shelf Lands Act waters, the collecting officer or officers shall not be required to segregate the amount paid under protest or hold the amount paid under protest in escrow pending the outcome of the suit.

(2) The Department of Revenue shall not pursue any action to recapture credits issued for ad valorem taxes related to a suit challenging the legality of the ad valorem tax on vessels in Outer Continental Shelf Lands Act waters if the taxpayer prevails, the collecting officer or officers was not required to segregate or escrow the amount paid in accordance with this Subsection, and the taxpayer does not receive a refund of the ad valorem taxes paid from the collecting officer or officers.

(3) In the event the taxpayer prevails in a suit challenging the legality of the ad valorem tax on vessels in Outer Continental Shelf Lands Acts waters and the collecting officer or officers refunds any amount paid under protest that was not required to be segregated or held in escrow, the taxpayer shall file an amended tax return within sixty days of the date of issuance of the refund reflecting the amount of the refund and any interest paid on the refunded amount as a reduction in the ad valorem tax credit originally received for the taxes paid under protest. Any taxpayer failing to file an amended return as set forth in this Subsection shall be subject to the penalty provided for in R.S. 47:1602.

(4) This Subsection shall not apply to any payment under protest made by a taxpayer challenging the correctness of an assessment as provided in R.S. 47:2134(B).

H. Taxpayers that pay ad valorem taxes for the 2020 tax year that are eligible for the credit provided by this Section but are paid after December 31, 2020, may elect to treat these taxes as having been paid on December 31, 2020, for purposes of this credit, provided that the payments are made to the local tax collector on or before April 15, 2021. Taxpayers that make this election shall not also claim these taxes as having been paid in 2021 for purposes of claiming this credit for the 2021 tax year.

Acts 1994, 3rd Ex. Sess., No. 59, §1, eff. July 7, 1994; Acts 2002, No. 11, §1, eff. for all taxable periods beginning after Dec. 31, 2002; Acts 2015, No. 357, §1, eff. June 29, 2015; Acts 2017, No. 418, §1, eff. July 1, 2017; Acts 2020, 2nd Ex. Sess., No. 56, §1, eff. Nov. 5, 2020.

NOTE: See Acts 2017, No. 418, §2, re: applicability.