The secretary of the Department of Revenue would be in charge of implementing the provisions of the credit. (Credit: WEERAPAT WATTANAPICHAYA/Adobe Stock)
A bill introduced in the Louisiana House of Representatives would provide an income tax credit for taxpayers' auto insurance premiums. If passed, these credits would be the first of their kind in the U.S., as most citizens are currently unable to deduct any amount of money spent on their personal vehicle coverage from their annual taxes.
The bill is sponsored by Democratic Representative Edmond Jordan.
House Bill 331 would provide an auto insurance credit for taxpayers that equals the lesser of the following:
- The amount of qualifying auto premiums paid in excess of $2,500 per vehicle, for no more than two vehicles, in a taxable year.
- $5,000 per vehicle for no more than two vehicles.
For purposes of the bill, “qualifying” auto premiums are those paid for motor vehicle insurance on an auto the taxpayer owns.
Anyone who claims the credit would be required to maintain all records necessary to verify their eligibility and must provide this documentation to the Department of Revenue while filing their tax return if the agency requests.
If the tax credit earned exceeds the taxpayer’s total tax liability in a year, any of the credit that is not used as an offset against that liability could be carried forward for subsequent tax liabilities for no more than five years.
The secretary of the Department of Revenue would be in charge of implementing the provisions of the credit.
If passed, the bill will be in effect from January 1, 2026 to December 31, 2031. At the time of publication, the bill has been provisionally referred to the House's Committee on Ways and Means.
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