2021 Louisiana Laws
Revised Statutes
Title 47 - Revenue and Taxation
§1604.1. Negligence penalty

RS 1604.1 - Negligence penalty

A. Finding of negligence. For negligent failure to comply with any provisions of this Part or any rules and regulations of the department, when the secretary finds that a taxpayer did not have willful intent to defraud the state, the secretary may assess a penalty equal to ten percent of the tax deficiency found to be due as a result of the taxpayer's negligence.

B. Large individual income tax deficiency. In the case of individual income tax, if a taxpayer understates tax table income, by any means, by an amount equal to twenty-five percent or more of adjusted gross income or has otherwise demonstrated a willful intent to disregard the tax laws of this state, the secretary may assess a penalty equal to twenty percent of the deficiency. However, in the case of individual income tax, if a taxpayer understates tax table income by an amount equal to twenty-five percent or more of adjusted gross income but the secretary finds that the taxpayer did not have willful intent to disregard the tax laws of this state, the secretary may assess a penalty of fifteen percent of the deficiency.

C. Other large tax deficiency. In the case of a tax other than individual income tax, if a taxpayer understates tax liability by twenty-five percent or more, or has otherwise demonstrated a willful intent to disregard the tax laws of this state, the secretary may assess a penalty equal to twenty percent of the deficiency. However, in the case of a tax other than individual income tax, if a taxpayer understates tax liability by twenty-five percent or more, but the secretary finds that the taxpayer did not have willful intent to disregard the tax laws of this state, the secretary may assess a penalty of fifteen percent of the deficiency.

D. For purposes of this Section, the following terms shall have the following meanings unless the context clearly indicates otherwise:

(1) "Adjusted gross income" means gross income as defined in Section 62 of the Internal Revenue Code.

(2) "Willful" means voluntarily and intentionally acting in violation of the tax laws of this state. The secretary shall use this definition of "willful" when determining whether a penalty shall be imposed for the willful intent to defraud this state or willful intent to disregard the tax laws of this state.

NOTE: §1604.1 eff. Jan. 1, 2021. See Acts 2020, No. 348.

RS 1604.1 - Accuracy-related penalty

A.(1) Finding of negligence. For negligent failure to comply with any provisions of this Subtitle or any rules and regulations of the department, when the provisions of R.S. 47:1604 and Subsection D of this Section do not apply the secretary may assess a penalty equal to twenty percent of the tax deficiency found to be due as a result of the taxpayer's negligence.

(2)(a) A penalty equal to the amount of the penalty that would be due pursuant to Paragraph (1) of this Subsection shall be presumed to apply if the taxpayer understates tax liability by ten percent or more but did not demonstrate a willful disregard of the tax laws of this state.

(b) The penalty provided for pursuant to this Paragraph shall not be applicable if a taxpayer's understatement was due to reasonable cause where the taxpayer acted in good faith.

B. Large individual income tax deficiency. In the case of individual income tax, if a taxpayer understates tax table income, by any means, by an amount equal to twenty-five percent or more of adjusted gross income the secretary may assess a penalty of ten percent of the deficiency in addition to any penalty provided for in Subsection A of this Section.

C. Other large tax deficiency. In the case of a tax other than individual income tax, if a taxpayer understates tax liability by twenty-five percent or more, the secretary may assess a penalty of ten percent of the deficiency in addition to any penalty provided for in Subsection A of this Section.

D. Willful disregard for Louisiana tax laws. (1) If a taxpayer has demonstrated a willful disregard of the tax laws of this state, the secretary may assess a penalty of forty percent of the tax deficiency found to be due.

(2) If the penalty under this Subsection applies, then the penalty due pursuant to the provisions of Subsection A, B, or C of this Section shall not be applicable.

E. Definitions. For purposes of this Section, the following terms shall have the following meanings unless the context clearly indicates otherwise:

(1) "Adjusted gross income" means gross income as defined in Section 62 of the Internal Revenue Code.

(2) "Negligent failure" means any failure to make a reasonable attempt to comply with the tax laws of this state, or a careless or reckless disregard for the tax laws of this state.

(3) "Willful disregard" means voluntarily and intentionally acting in violation of the tax laws of this state. The secretary shall use this definition of "willful disregard" when determining whether a penalty shall be imposed for the willful disregard of the tax laws of this state. Willful disregard shall be presumed when a taxpayer fails to timely remit tax withheld or collected from others, absent a showing of good cause.

Added by Acts 1958, No. 240, §1; Acts 2015, No. 128, §1, eff. July 1, 2015; Acts 2020, No. 348, §1, eff. Jan. 1, 2021.