RS 47:287.738

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RS 47:287.738

§287.738. Other inclusions and exclusions from gross income

A. Inclusion of payments to non-United States companies.

Notwithstanding any federal law to the contrary, gross income as defined in R.S. 47:287.61 of this Part shall include rents, salaries, wages, premiums, annuities, compensations, remuneration, emoluments, and other fixed or determinable annual or periodical gains, profits, and income taxed pursuant to United States Internal Revenue Code Section 881 relative to amounts received from sources within the United States by corporations not created or organized in the United States or under the laws of the United States or any state.

B. Inclusion of target company gains.

(1)For the purposes of this Part, if a purchasing corporation makes an election under I.R.C. Section 338, or is treated under Subsection

(e)of I.R.C. Section 338 as having made such an election, then, in the case of any qualified stock purchase, the target corporation:

(a)Shall be treated as having sold all of its assets at the close of the acquisition date at fair market value in a single transaction and

(b)Shall be treated as a new corporation which purchased all of the assets referred to in Subparagraph

(a)as of the beginning of the day after the acquisition date.

(2)Any gain or loss recognized under Paragraph (B)(1) shall be taken into account in determining gross income under R.S. 47:287.71.

(3)The secretary may prescribe reasonable and needful methods of accounting, computation, and basis determination for the administration of this Subsection, including the allocation and apportionment of any gain within and without Louisiana.

(4)The secretary may provide that the gain determined under this Section may be reduced by the gain on the sale of target corporation stock determined to have borne Louisiana income tax.

C. Interest on obligations or securities issued by the state of Louisiana or its political or municipal subdivisions is exempt and therefore excluded from gross income.

D. 1934 Basis Adjustment.

(1)The adjusted basis for computing gain on the sale of property acquired before January 1, 1934 shall be its adjusted basis under federal law or its fair market value on January 1, 1934, whichever is higher.

(2)If the basis determined in Paragraph (D)(1) exceeds the property's adjusted basis under federal law, the difference between the two bases may be excluded from gross income to the extent of the gain included in gross income.

E. Gain or loss upon disposition of installment obligations.

(1)If an installment obligation is satisfied at other than its face value or distributed, transmitted, sold, or otherwise disposed of, gain or loss shall result to the extent of the difference between the basis of the obligation and

(a)In the case of satisfaction at other than face value or a sale or exchange, the amount realized, or

(b)In case of a distribution, transmission, or disposition otherwise than by sale or exchange, the fair market value of the obligation at the time of such distribution, transmission, or disposition. The basis of the obligation shall be the excess of the face value of the obligation over an amount equal to the income which would be returnable were the obligation satisfied in full.

(2)In the case of a distribution in liquidation, the secretary may permit the distributee to report the gain in the year received.

F. Deduction for interest and dividends.

(1)Effective for taxable years beginning after December 31, 2005, there shall be allowed for each taxable year a deduction equal to the amount of dividends that would otherwise be included in gross income.

(2)Effective for taxable years beginning after December 31, 2005, there shall be allowed for each taxable year a deduction equal to the amount of interest that would otherwise be included in gross income; however, a corporation may elect to pay tax on interest income from a corporation which is controlled by the former through ownership of fifty percent or more of the voting stock of the latter and to use the provisions of R.S. 47:287.93(A)(2).

G. Deduction for hurricane recovery benefits. Any gratuitous grant, loan, or other benefit directly or indirectly provided to a taxpayer by a hurricane recovery entity as defined in R.S. 47:293 shall be allowed as a deduction if such benefit was included in federal adjusted gross income.

H. Exemption for COVID-19 relief benefits. Any gratuitous grant, loan, rebate, tax credit, advance refund, or other qualified disaster relief benefit directly or indirectly provided to a corporation by the state or federal government as a COVID-19 relief benefit as defined in R.S. 47:297.16 shall be exempt if the benefit was included in the corporation's federal gross income.

Acts 1986, 1st Ex. Sess., No. 16, §1, eff. Dec. 24, 1986; Acts 2005, No. 401, §1, eff. for all taxable periods beginning after Dec. 31, 2005; Acts 2007, No. 247, §1, eff. July 6, 2007; Acts 2015, No. 123, §1, eff. July 1, 2015; Acts 2015, No. 123, §3, eff. July 1, 2018; Acts 2021, No. 54, §1, eff. June 4, 2021.

NOTE: See Acts 2015, No. 123, §5, re: applicability.

NOTE: See Acts 2018, 2 nd E.S., No. 4, §1, re: applicability.