Louisiana enacted a landmark flat income tax reform in 2024, replacing its old graduated bracket system with a flat 3.00% rate effective January 1, 2025 (unchanged for 2026). Act 11 also created a new standard deduction: $12,500 for single filers and $25,000 for married filing jointly. Louisiana uses federal AGI as its starting income base. Social Security benefits are not taxed.
State Income Tax
Flat 3.00%
Standard Deduction (Single)
$12,500
Supplemental Rate
3.00%
Louisiana Income Tax 2026
Louisiana's flat 3.00% rate applies to all taxable income after subtracting the standard deduction. Single and married filing separately filers subtract $12,500; married filing jointly and head of household filers subtract $25,000. Louisiana no longer has a personal exemption system - Act 11 replaced both the graduated brackets and the prior personal exemption structure.
OBBBA Conformity - Louisiana Conformity Status Pending
Louisiana starts from federal adjusted gross income (AGI). The OBBBA tips income deduction and overtime deduction are above-the-line adjustments that reduce federal AGI - if they work as structural flow-through deductions, they would automatically reduce Louisiana taxable income. However, no official Louisiana DOR guidance confirming OBBBA conformity has been issued as of mid-2026. Verify from the 2026 IT-540 instructions or any LDR special notice when published.
Louisiana Sales Tax
Louisiana's state sales tax rate is 5%. Louisiana has some of the highest local parish sales taxes in the nation - local rates commonly range from 4% to 7% on top of the state rate, giving Louisiana one of the highest combined average rates in the country. Louisiana exempts groceries (food for home consumption) from the state sales tax, but local parish taxes commonly still apply to food purchases.
Louisiana switched to a flat 3.00% state income tax effective January 1, 2025 (Act 11 of the 2024 Third Extraordinary Legislative Session), unchanged for 2026. This replaced the old graduated system (2%, 4%, 6%). Louisiana also created a new standard deduction: $12,500 for single filers and $25,000 for married filing jointly.
What was Louisiana's income tax reform under Act 11?
Act 11 of the 2024 Third Extraordinary Legislative Session was a landmark restructuring of Louisiana income tax. The prior three-bracket graduated system (2%/4%/6%) was replaced with a flat 3% rate. Simultaneously, Louisiana created a new standard deduction replacing the old personal exemption structure: $12,500 for single/MFS filers and $25,000 for married filing jointly and head of household. These changes took effect January 1, 2025 and continue for 2026.
Does Louisiana conform to the OBBBA tips and overtime deductions?
Louisiana's conformity with the OBBBA tips and overtime deductions is not yet confirmed. Louisiana uses federal AGI as its starting point - if the OBBBA tips and overtime deductions reduce federal AGI (as above-the-line adjustments), they would flow through to the Louisiana tax base automatically. However, no official Louisiana DOR guidance on OBBBA conformity has been issued as of mid-2026. Verify from LDR guidance or the 2026 IT-540 instructions when published.
Does Louisiana have local income taxes?
Louisiana has no local income taxes. However, Louisiana has some of the highest local sales taxes in the nation - local parish sales taxes commonly range from 4% to 7% on top of the 5% state rate. This gives Louisiana a combined sales tax rate among the highest in the country. Local parish taxes frequently apply to groceries even though the state exempts food.
Does Louisiana tax Social Security income?
No. Louisiana does not tax Social Security benefits. Additionally, Louisiana provides a retirement income exclusion for taxpayers age 65 and older - the first $6,000 of qualifying retirement income (pensions, annuities, etc.) may be excluded from state income tax. Verify the exact 2026 exclusion amount from Louisiana DOR.
What is Louisiana's withholding rate for bonus pay?
Louisiana's supplemental withholding rate for bonuses and other supplemental wages is 3.00%, matching the flat income tax rate. This is the rate employers use when withholding on bonus payments separate from regular wages.
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