By the Kean Miller Tax Team

The 2019 Regular Session of the Louisiana Legislature ended on June 6, 2019. Important new tax provisions include several legislative acts signed into law by the Governor along with several proposed constitutional amendments that will appear on the ballot this October. In addition to substantive law changes, important remedial

By Jaye Calhoun, Jason Brown, and Willie Kolarik

The Louisiana Legislature is considering last minute legislation to change the effective date of legislation allowing the State to tax remote sellers but has not acted to make other centralized collection legislation operative.  It may not have to.

Today, in a 5-4 decision with far-reaching

By the Kean Miller State and Local Tax Team

On June 21, 2018, the Supreme Court of the United States issued its opinion in South Dakota v. Wayfair, Inc., Dkt. No, 17-494, 585 U.S. __ (June 21, 2018).  In addition to overturning the physical presence substantial nexus standard applicable to use tax collection requirements articulated

Industrial Strength Graphic Only

By Jaye Calhoun, Phyllis Sims, and Willie Kolarik

Despite consideration of an Ohio-style gross receipts tax, a Michigan-style single business tax and various versions of flat taxes, the 2017 Regular Session of the Louisiana Legislature ended on June 8, 2017, without the enactment of any significant tax reform. Because the Legislature neglected to

labor

By Jaye Calhoun

It’s time to amend the governing documents of flow-through entities taxed as partnerships to address recent federal legislative changes impacting all such entities.  Failure to amend now could result in unfavorable tax consequences.  Section 1101 of The Bipartisan Budget Act of 2015 (the “BBA”) substantially changes how the Internal Revenue Service may

flood

By Kevin C. Curry and Carey J. Messina

Many employers have a number of employees who were affected by the August 2016 flooding event in Louisiana.  These employers are looking for means to assist their employees in recovering from this significant disaster.  Employers have a number of options for providing disaster relief assistance to their

irs

By Kevin C. Curry

The Internal Revenue Service (IRS) has granted tax relief to postpone various tax filing and payment deadlines for certain filings or payments that were due on or after August 11, 2016.  The relief postpones the filing deadlines or payment deadlines until January 17, 2017.  Therefore, this extension will include the September

garage sale

By Chris Dicharry and Jason Brown

The Louisiana state and local sales tax laws have historically included an isolated or occasional sale rule. In general, the rule looks at the characteristics of a seller to determine if a sales taxable transaction has occurred. If the seller is not engaged in the business of selling the

By Kyle C. McInnis

New parents have to make a number of adjustments to their lives. From dealing with diaper rash to sleep deprivation, they have a lot to deal with. But parenting duties are not limited to physical care of a child. There are numerous financial parenting tips that every new parent must consider. This article is intended to hit the high points on the list of financial and estate planning tasks that every new parent should consider.

1) Adjust Income Tax Withholdings.

The easiest and quickest way to get extra cash into a new parent’s hands is to adjust their income tax withholdings as soon as possible. A new child should allow a new dependency withholding exemption, assuming the child qualifies as a dependent of the parent. A taxpayer qualifies for a dependency exemption in the year of the dependant’s birth and for so long as the dependent continues to satisfy the definition of a “dependant” under Internal Revenue Code (“IRC”) § 152. The additional dependency exemption should work to reduce a parent’s required tax withholdings from his or her paycheck.

The parent should adjust his or her withholding certificate as soon as possible to take advantage of the new withholding exemption. The IRC allows for almost immediate adjustment to an employee’s withholding certificate. The IRC even allows prospective adjustments to withholding calculations if furnished before December 1 of the prior year under IRC § 3402(f)(2)(C). The sooner a parent’s withholding certificate is adjusted, the sooner his or her take home pay gets a much needed bump.

2) Identify Applicable Tax Breaks.

The IRS grants taxpayers several child related tax breaks, in addition to the dependency exemption under IRC § 151. Every parent should examine these tax benefits in calculating their income tax liability.

First, parents are granted a child tax credit of $1,000 under IRC § 24. The child must be a qualifying child under IRC § 152(c), but this definition should cover almost all children living with the parent and less than seventeen years old. The credit is allowable against the alternative minimum tax, but begins to phase out for joint return filers making more than $110,000. For single parents, the phase out starts at $75,000. The phase out is complete at $130,000 for joint filers and $95,000 for individuals. In limited cases, the credit can be refundable under IRC § 24(d).

Parents with less than $15,000 in adjusted gross income are entitled to a tax credit for amounts paid to care for children, if such expenses allow the parent(s) to continue gainful employment. This credit is equal to thirty-five percent of the expenses incurred in caring for a child, up to a maximum amount of $3,000 for one child or $6,000 for two or more children.

Adoptive parents of special needs children also have a special tax break designed solely for them. Under IRC § 23, adoptive parents of children who are less than eighteen years old and physically or mentally incapable of caring for themselves are entitled to a tax credit for adoption expenses of up to $10,000. This credit is subject to a phase out for high earners.

3) Review or Create an Estate Plan.

Most new parents don’t have an estate plan because they’ve never thought they needed one. In a sense they are right. Louisiana law generally provides a spouse substantial rights in the community property of a decedent during the surviving spouse’s lifetime if the couple has no children. For single people, property usually stays within their family at death. But, when children arrive, a will is a must.


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By Kevin C. Curry

Act Number 323 of the 2011 Regular Session of the Louisiana Legislature modified the rules on small successions in Louisiana. In addition to some other changes, the law allows the use of the small succession procedure, which generally involves filing an affidavit rather than opening judicial proceedings, to transfer title to