BUSINESS TAXES AND EMPLOYEE TAX/INSURANCE REQUIREMENTS

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Occupational License Taxes

Occupational Licenses are essentially taxes on the gross receipts of various classes of businesses and professions.  There are virtually no exemptions, except that there is a minimum and maximum tax which may be paid by an individual or firm.   Occupational license taxes are payable on a sliding scale, depending upon the gross receipts of the business or profession.  Some representative tax ranges are shown below:

Manufacturers are not required to pay occupational license taxes (except on retail sales).  The statute governing occupational license taxes is rather complicated.  For more precise information about the amount of occupational license tax owed by your business, please contact the City's Revenue Division at the address shown below.

Contact your city, town or village hall, www.lma.org/munisearch.htm, or parish government (if outside incorporated area), www.lpgov.org/, click on Louisiana Parish Directory for contact information.                   

Property Taxes

Property taxes are levied on land, improvements, business furniture and fixtures, and inventories.  The assessed valuation for tax purposes is generally 15% of market value (I0% for land and residential improvements) and is set by the Parishes Tax Assessor, subject to appeal to the Louisiana Tax Commission.  Questions about the assessed value of a particular parcel should be addressed to your local tax assessor.  For contact information, go to: www.louisianaassessors.org/Assessors/Assessors.htm

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Sales & Use Taxes       

Local – Each parish has a Sales and Use Tax Commission that collects sales taxes for the municipalities and the Parish.  Any business required to collect sales taxes must register with their appropriate Commission and submit tax receipts according to the schedule established by the Commission for your business and parish.  Contact:  www.laota.com/pta.htm, then click on your parish for contact information. Some parishes allow you file for your sales tax number online at: www.laota.com/registration/tax_application.htm

State – In addition to local sales taxes, the state collects a 4% sales tax on most retail items and certain services.  You are required to register with the State of Louisiana's Department of Revenue and Taxation to receive your Sales Tax Account number, and submit your sales tax liability as required by the Department.  Contact: Department of Revenue, Shreveport Office, (318) 676-7505; for application, go to: www.revenue.louisiana.gov/sections/business/intro.aspx

State Corporate Income Tax 

The corporate income tax ranges from 4% to 8% of net taxable income.  The effective rate of taxation is somewhat less because federal income taxes are deductible in computing Louisiana net taxable income.  A partial waiver of corporate income taxes is allowable under incentive programs.  Current tax rates are:

Contact:  Department of Revenue, Shreveport Office, (318) 676-7505, http://revenue.louisiana.gov/SECTIONS/business/corp.aspx#corporation

Corporate Franchise Tax 

The rate is $1.50 per $1,000 on first $300,000 of capital stock, surplus, undivided profits, and borrowed capital employed in Louisiana; $3 per $1,000 after first $300,000.  Credits and exemptions available through various state tax incentive programs.  Note:  Under legislation passed during the 2004 Special Session and 2008 2nd Special Session of the Louisiana Legislature the inclusion of borrowed capital within the Franchise Tax began phase-out Jan. 1, 2006, and will be fully implemented as of Jan. 1, 2011.  Taxable Year Amount of Borrowed Capital Included in Tax Base:

Louisiana Department of Revenue and Taxation, Shreveport Office, 1525 Fairfield Avenue, Shreveport, LA 71101, (318) 676-7505,  revenue.louisiana.gov/SECTIONS/business/corp.aspx

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Employee Taxes

All companies with employees are required to participate in the following employee tax programs:

Federal and State Income Tax Withholding

All employers are required to withhold income taxes from their employees’ wages for both the Federal and State government.  To know how much income tax to withhold from employees' wages, you should have all new employees complete the appropriate forms: a Form W-4, Employee's Withholding Allowance Certificate for Federal withholding, www.irs.gov/pub/irs-pdf/fw4.pdf. To register online for a Louisiana Account Number go to www.revenue.louisiana.gov/sections/business/intro.aspx

Social Security and Medicare Taxes

By Federal law, all employers must withhold Social Security and Medicare taxes from an employee’s gross wages (7.65% up to a certain amount, 1.45% thereafter).  The employer must also pay an equal amount for this tax.  Depositing procedures vary depending upon the total amount an employer withholds from all employees.  Current information on amounts to withhold as well as up-to-date employee income tax withholding taxes may be found in the IRS publication entitled Circular E, Employer’s Tax Guide, www.irs.gov/publications/p15/index.html

Unemployment Insurance

With a few exceptions, all businesses with employees must pay federal and state unemployment taxes.  The tax is the business owner’s responsibility; it is illegal to deduct this tax from an employee’s wages.  For information on Louisiana Unemployment Compensation matters, Contact: Louisiana Department of Labor, Employer Status Unit, (866) 783-5567,

www.laworks.net/UnemploymentInsurance/UI_Employers.asp.  To register for Unemployment Insurance go to:

www.laworks.net/Downloads/UI/WTS/UnemploymentAccountAppES1web.pdf.   For Federal information, the IRS publication, Circular E, Employer’s Tax Guide, provides information on filing with the Federal government. www.irs.gov/publications/p15/index.html

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Federal Unemployment (FUTA) Tax

The Federal Unemployment Tax Act (FUTA), with state unemployment systems, provides for payments of unemployment compensation to workers who have lost their jobs. Most employers pay both a Federal and a state unemployment tax. A list of state unemployment tax agencies, including  addresses and phone numbers, is available in Pub. 926, Household Employer's Tax Guide. Only the employer pays FUTA tax; it is not deducted from the employee's wages. For more information, see the Instructions for Form 940, www.irs.gov/pub/irs-pdf/i940.pdf

Workers’ Compensation

Louisiana State law mandates that all employers must provide Workers’ Compensation insurance for their employees.  Rates vary depending upon employee classifications. Contact: Louisiana Department of Labor, Office of Workers’ Compensation Administration, (225) 342-7555, www.laworks.net/WorkersComp/OWC_EmployerMenu.asp

Note: An Employer Handbook outlining requirements for the state Unemployment and Worker’s Compensation programs may be accessed through the Louisiana Department of Labor’s website at  www.laworks.net/Downloads/Employment/EmployerHandbook.pdf