La. Admin. Code tit. 61 § I-1921

Current through Register Vol. 50, No. 9, September 20, 2024

Section I-1921 - Louisiana Youth Jobs Tax Credit

A. General Description

1. The Youth Jobs credit provides an income and franchise tax credit for businesses that hire one or more eligible youth, as defined herein, on or after July 1, 2021. The credit is allowable on a one-time basis for each eligible youth hired.

2. To be eligible for the credit, a business must employ an individual who:

a. meets the definition of an eligible youth, as defined herein, on or after July 1, 2021;

b. has worked in a full-time or part-time position, as defined herein, for at least three consecutive months at the business seeking to utilize the credit.

3. For a business seeking to utilize the credit for the amounts authorized for a full-time position, as provided in Paragraph D.2., an individual must have worked for three consecutive months in a full-time position in order to be eligible for the amounts so authorized.

4. The credit shall be earned in the year in which the eligible youth completes the third consecutive month of work in either a full-time or part-time position. Under no circumstances may a business earn more than one credit per eligible youth.

5. The credit shall be allowed against the income tax for the taxable period for which the credit is earned and against the franchise tax for the taxable period following the period in which the credit is earned. If the tax credit allowed pursuant to R.S. 47:6028 exceeds the amount of such taxes due, any unused credit may be carried forward as a credit against subsequent liability for a period not to exceed five years.

6. A taxpayer shall not receive any other incentive for the job creation or hiring of an eligible youth for which the taxpayer has received a tax credit pursuant to this Section, including but not limited to the provisions of R.S. 25:1226,47:6023, 6026, 6033 or 51:1787, and 2451.

B. Definitions

Department-the Louisiana Department of Revenue

Eligible Youth-an individual who:

a. has attained the age of 16 but not yet attained the age of 24.

b. is unemployed prior to being hired by a business that will apply for a credit pursuant to the provisions of this Section.

c. will be working in a full-time or part-time position that pays wages that are equivalent to the wages paid for similar jobs, with adjustments for experience and training.

d. meets at least one of the following criteria:

i. is at least 18 years old, is no longer in school, and does not have a high school diploma, HiSET or GED credential, or high school equivalency diploma;

ii. is a member of a family that is receiving assistance from the Family Independence Temporary Assistance Program;

iii. is a member of a family that is receiving benefits through the Supplemental Nutrition Assistance Program;

iv. is a member of a family that is receiving assistance from the Kinship Care Subsidy Program;

v. is a member of a family that is receiving assistance or benefits under the Temporary Assistance for Needy Families Program;

vi. has served time in jail or prison or is on probation or parole;

vii. is pregnant or is a parent;

viii. is homeless;

ix. is currently or was in foster care, extended foster care, or the custody of the Department of Children and Family Services;

x. is a veteran;

xi. is the child of a parent who is currently incarcerated or was released from incarceration within the past two years;

xii. lives in public housing or receives housing assistance such as a Section 8 voucher.

Full-Time Position-a position in which a person works at least 32 hours per week.

Part-Time Position-a position in which a person works at least 20 hours per week but less than 32 hours per week.

C. Application

1. Beginning January 1, 2022, taxpayers seeking to utilize the youth jobs tax credit for taxable periods beginning on or after January 1, 2021 must annually apply for and be deemed eligible for the credit by the department. The application period for calendar year 2021 shall begin on March 1, 2022 and conclude on April 30, 2022. Thereafter, the application period shall begin on January 1 and conclude on February 28 of the subsequent calendar year. Applications may not be submitted and will not be accepted prior to the application period. Taxpayers must electronically submit a Louisiana Youth Jobs Tax Credit Application (Form R-90004) to the department for review. Each application must include an employee-completed Louisiana Youth Jobs Tax Credit Employee Certification (Form R-90004-B) for each employee claimed, which includes the qualifying employee's date of birth, date of hire, and satisfied employment criteria of the eligible youth, as defined herein, as well as all other required information. After exercising due diligence to ensure compliance with the requirements provided herein, qualifying taxpayers must maintain supporting documentation which can be produced upon request of the department to substantiate the qualification of an eligible youth. Completed applications should be submitted to YouthJobsCredit@La.gov. A taxpayer is deemed eligible upon satisfactorily demonstrating that it has met the requirements of Subsection A of this Section during the calendar year.

D. Approval

1. For calendar year 2021, the department shall notify each taxpayer that submitted a timely and complete application as to whether the application has been approved or denied as to each youth employee no later than July 1, 2022. For all application periods subsequent to calendar year 2021, the department shall send such notice no later than May 1 following the close of the application period. If approved, the tax notice letter shall include Form R-90004 indicating the amount of credit earned and the taxable periods against which the nonrefundable credit(s) may be used. If denied, the letter shall so provide the reasons for denial.

2. Pursuant to R.S. 47:6028, an approved application shall authorize a taxpayer for eligibility for one or more nonrefundable credit(s) with a carryforward of five years equal to $750 or $1250 for each eligible youth employed in either a part-time or full-time position, respectively, unless subject to proration, for the tax period deemed eligible. In the event the taxpayer is subject to proration due to the credit cap provisions, the taxpayer shall only be eligible for a credit equal to the pro rata amount for the tax period deemed eligible.

3. For each calendar year, beginning with the March 1-April 30, 2022 application period, the department shall not approve credits in excess of $5,000,000. For purposes of administering the credit cap, the department shall count each approved eligible youth employed either part-time or fulltime at a value of $750 or $1250, respectively, or if subject to proration, the pro rata value. Eligible applications shall be approved for the credit by the department on a first-come, first-served basis as determined by the received date of a completed Louisiana Youth Jobs Tax Credit Application. An application shall not be considered complete until all information requested by the department has been received.

4. All applications received on the same business day shall be treated as received at the same time, and if the aggregate amount of requests received on the same business day exceeds the total amount of available tax credits, tax credits shall be approved on a pro rata basis.

5. In the event it is determined by the department that the taxpayer has not met the requirements of Subsection A of this Section, any amounts approved are subject to disallowance and any amounts allowed to offset tax are subject to recapture by the department.

E. Claiming the Credit

1. Taxpayers claiming tax credits on a return must include Form R-90004. The accrual of interest shall be suspended during any period of time that a delay in the issuance of a refund is attributable to the taxpayer's failure to provide information or documentation required herein, as provided by R.S. 47:1624(F).

La. Admin. Code tit. 61, § I-1921

Promulgated by the Department of Revenue, Policy Services Division, LR 48504 (3/1/2022).

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:1511 and R.S. 47:6028.