§297.4. Reduction to tax due; certain child care expenses

A. There shall be a credit from the tax imposed by this Part for child care expenses for which a resident individual is eligible pursuant to the federal income tax credit provided by Internal Revenue Code Section 21 for the same taxable year. The credit shall be calculated using the following percentages :

(1)(a) If the resident individual's federal adjusted gross income is equal to or less than twenty-five thousand dollars, the credit shall be calculated based on the federal tax credit before it is reduced by the amount of the individual's federal income tax and be equal to the following amounts for the following tax years:

(i) For tax years beginning after December 31, 2005 and ending before January 1, 2007, twenty-five percent of the unreduced federal credit.

(ii) For tax years beginning after December 31, 2006 fifty percent of the unreduced federal credit.

(b) For the individuals provided for by this Paragraph, the Louisiana credit shall be allowed without regard to whether they claimed such federal credit.

(2) If the resident individual's federal adjusted gross income is greater than twenty-five thousand dollars and less than or equal to thirty-five thousand dollars, the credit shall be equal to thirty percent of the federal credit for child care expenses claimed on the resident individual's federal tax return.

(3) If the resident individual's federal adjusted gross income is greater than thirty-five thousand and less than or equal to sixty thousand dollars, the credit shall be equal to ten percent of the federal credit for child care expenses claimed on the resident individual's federal tax return.

(4) If the resident individual's federal adjusted gross income is greater than sixty thousand dollars, the credit shall be equal to the lesser of twenty-five dollars or ten percent of the federal credit for child care expenses claimed on the resident individual's federal tax return.

B.(1) If the credit against Louisiana income tax for resident individuals whose federal adjusted gross income is equal to or less than twenty-five thousand dollars exceeds the amount of such individual's tax liability for the taxable year, then such excess tax credit 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 under this Part. The right to a refund of any such overpayment shall not be subject to the requirements of R.S. 47:1621(B).

(2) If the credit against Louisiana income tax for resident individuals whose federal adjusted gross income is greater than twenty-five thousand dollars exceeds the amount of such individual's tax liability for the taxable period, then such excess tax credit may be carried forward as a credit against any subsequent tax liability of such individual imposed by this Part for a period not exceeding five years.

Acts 2002, No. 25, §1, eff. for all taxable periods beginning on or after Jan. 1, 2003; Acts 2005, No. 495, §1, eff. July 12, 2005, applicable to all tax years beginning on and after Jan. 1, 2006.