HB 633: TAX RETURN: Modifies statutory timelines, penalty calculations, and exceptions for penalties for the payment of certain estimated taxes (EN DECREASE GF RV See Note) - Louisiana

HB633 Original → HB633 Act 307 · 4 edits

MODERATE

This bill updates Louisiana's tax laws to clarify how penalties for unpaid estimated income taxes are calculated. It modifies the percentage thresholds used to determine if a taxpayer has paid enough to avoid penalties and changes the specific dates used to measure the period of underpayment. The act also repeals a section regarding excessive tax adjustments and clarifies rules for farmers and fishermen.

Scope change

The bill expands the scope of the penalty calculation rules to include specific provisions for individuals with income from farming and fishing, adjusting the percentage thresholds from 70% to 66.67% for these groups.

REQUIREMENT

Changed the percentage threshold for avoiding estimated tax penalties from 70% to 66.67% (two-thirds) for individuals whose income comes from farming or fishing.

Repealed the specific section (R.S. 47:118(D)(1)(c)) that previously defined how to calculate the period of underpayment under certain conditions.

TIMELINE

Updated the statutory language to change the deadline for the underpayment period from the 15th day of the fourth month to the 15th day of the fifth month following the close of the taxable year.

DEFINITION

Refined the definition of 'required annual payment' to explicitly include the tax from the preceding year as a benchmark for calculating the required installment amount.

HB633 Enrolled → HB633 Original · 5 edits

MODERATE

This bill updates Louisiana tax laws to clarify when penalties for unpaid estimated taxes begin and to adjust the calculation thresholds for corporate underpayments. It changes the start date for penalty periods and modifies the percentage amounts used to determine if a corporation has paid enough estimated tax to avoid penalties.

Scope change

The bill applies to income tax periods beginning on or after January 1, 2026, and specifically targets corporations regarding estimated tax payments.

TIMELINE

The period during which penalties for unpaid estimated taxes are calculated now starts from the due date of the installment until the earlier of the 15th day of the fifth month after the tax year ends or another specific date, clarifying the timeline for when penalties accrue.

A new effective date provision was added, stating the law takes effect on January 1, 2026, or upon gubernatorial signature/veto override, depending on the legislative process.

REQUIREMENT

The threshold for avoiding penalties on corporate estimated tax payments was changed from 90% to 80% of the tax for the year, making it easier for corporations to avoid underpayment penalties.

The method for calculating the 'required annual payment' for corporations was updated to use an annualized basis based on taxable income for specific portions of the tax year (e.g., first three, six, eight, nine, or eleven months), replacing the previous percentage-based rules.

Specific provisions regarding special percentage rates (66 2/3%) for individuals with farming income were removed from the corporate tax section, likely because they do not apply to corporations.

HB633 Reengrossed → HB633 Enrolled · 3 edits · May 18, 2026

MINOR

The bill was finalized as an enrolled version, changing its status from a reengrossed draft to the final legislative text. The primary substantive change involves correcting a percentage threshold for estimated tax payments for certain individuals, raising the requirement from 70% to 90% of the prior year's tax liability. Other sections were reorganized and clarified to ensure consistency in how underpayment penalties are calculated for farmers and fishermen.

Scope change

The bill's scope remains focused on tax return penalties and estimated tax timelines, but the eligibility criteria for the lower payment threshold were narrowed for specific farming-related cases.

REQUIREMENT

The required annual payment percentage for certain individuals was increased from 70% to 90% of the tax shown on the return or the preceding year's tax.

DEFINITION

The definition of 'required annual payment' was updated to reflect the new 90% threshold for most taxpayers while maintaining a 66-2/3% threshold specifically for individuals with farming income.

TECHNICAL

Several sections were renumbered and reorganized to correct inconsistencies between subsections regarding penalty calculations and underpayment periods.

HB633 Engrossed → HB633 Reengrossed · 3 edits · Apr 29, 2026

MINOR

The bill was reengrossed to correct numerous typos and formatting errors from the previous version, such as repeating words like 'fifteenth' and 'lesser,' and fixing inconsistent numbering. These changes do not alter the actual tax laws or penalties; they only improve the clarity and accuracy of the text.

TECHNICAL

Corrected repeated words and typos (e.g., changed '15th fifteenth day' to '15th day' and 'lesser the lesser' to 'lesser') to ensure the statute is legally clear.

Fixed inconsistent numbering and formatting in the list of exceptions for penalty waivers, ensuring the structure matches the intended legal logic.

Adjusted the calculation method for corporate estimated tax penalties, changing the percentage threshold from ninety percent to eighty percent for income based on the first three months of the year.

TAX RETURN: Modifies statutory timelines, penalty calculations, and exceptions for penalties for the payment of certain estimated taxes (EN DECREASE GF RV See Note)

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