Frequently Asked Questions
If I amend both my federal casualty loss year return and the federal return on which I originally included my hurricane recovery grant, do I have to amend both Louisiana returns?
No—you are not required to amend either state tax return. However, if you choose to amend one of the state income tax returns, you must file amended returns for all periods that federal amended returns were filed. You are not allowed to amend only selected periods.
Normally, if a taxpayer amends their federal income tax return, they are required to amend the Louisiana income tax return. However, in this case filing amended Louisiana tax returns to report the reduced federal casualty loss or net operating loss would result in an increased Louisiana income tax for those years in which the losses were reduced. Since The Louisiana Legislature has specifically disallowed taxation of any recovery grants received by taxpayers who were adversely affected by Hurricanes Katrina and Rita, requiring amended state returns in this instance would have the effect of imposing a tax on hurricane recovery grants. Therefore, for tax years ending before 2008, if the only change to a taxpayer’s federal return is a casualty or net operating loss adjustment allowed by the Federal Housing and Economic Recovery Act of 2008, the taxpayer will not be required to file a Louisiana amended return.