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Louisiana tax overhaul trims rates, doubles senior standard deduction; constitutional amendment on March 29 ballot
Summary
A meeting of the Louisiana Tax Institute in February focused on the tax changes enacted in the 2024 third special session and the constitutional amendment voters will decide March 29. Richard Nelson, Secretary of Revenue, said the package included both statutory changes already in effect and structural constitutional changes that will appear on the ballot.
A meeting of the Louisiana Tax Institute in February focused on the tax changes enacted in the 2024 third special session and the constitutional amendment voters will decide March 29. Richard Nelson, Secretary of Revenue, said the package included both statutory changes already in effect and structural constitutional changes that will appear on the ballot.
The department summarized why this matters: the statutory pieces that took effect Jan. 1 already change withholding and take-home pay for many residents; the constitutional amendment would alter long-term rules including a government-growth limit and protections for education and stabilization funds.
“Most of those changes went into effect on January 1,” Nelson said. “We did provide for the doubling of the standard deduction for citizens 65.” He described multiple constitutional alterations, including adjustments to funds used for teacher pay raises and the establishment of a government growth limit tied to inflation and population growth.
Assistant Secretary Luke Morris told the institute the individual income tax changes already in effect include a flat 3% rate and larger standard deductions. “Everyone in Louisiana would have seen an increase in their take home pay, since the rate has been reduced to that flat 3%,” Morris said, and he added that the retirement income exemption was increased and will be indexed for inflation: “The retirement income exemption ... was increased from $6,000 to $12,000 and also adjusted for CPI.”
Morris and Nelson said the package also decouples Louisiana from a later federal bonus-depreciation phaseout by locking a 100% bonus depreciation option into state law and will require Louisiana-specific K-1 forms for some pass-through taxpayers who opt in. On the corporate side, officials described a flat 5.5% corporate income tax rate and a new corporate standard deduction of $20,000; the corporate franchise tax will be repealed effective Jan. 1, 2026.
Department officials cautioned that some statutory details remain to be clarified through later legislation or administrative guidance. Morris identified a list of “cleanup” items the department and the institute expect to address in the next legislative session, including definitions and minor statutory corrections that could be returned to the Legislature for technical fixes.
Officials emphasized that the constitutional amendment and related statutes interact: some measures are already statutory and effective, while structural changes to funds and voter-authorized limits require passage of the amendment to take full effect. The institute said it plans at least one more meeting before the regular session to review specific bill text for any needed corrections or clarifications.
Ending: Department of Revenue officials asked institute members to surface remaining technical issues so the body can consider endorsing corrective language before the next session.
