On what income are employers required to withhold income tax?

Employers are required to withhold income tax on all wages that are subject to Louisiana income tax as follows:

• Employers located in Louisiana—income tax must be withheld on all employee wages earned in Louisiana regardless of whether the employee is a resident or not.
• Employers located in other states that impose state income tax—the employer must withhold the other state’s tax on wages earned within the other state even if the employee is a Louisiana resident. The Louisiana resident must file a tax return and pay income tax to the other state on the income earned in that state. In addition, the resident must also file an income tax return with Louisiana and report all income earned inside and outside of Louisiana, but the resident is allowed to take credit for taxes paid to other states.
• Employers located in other states that do not impose state income tax—the employer must withhold Louisiana income tax on Louisiana resident employee’s wages earned in the other state because Louisiana residents are required to pay Louisiana income tax on all income earned even if the income was earned in a state that does not impose an income tax.

The amount of Louisiana income tax to be withheld is based on the income tax withholding tables or formulas prescribed by Louisiana Administrative Code 61:I.1501 and the withholding exemptions and dependent credits provided by the employee in the Employee's Withholding Exemption Certificate, Form R-1300 (L-4). If the employee fails to provide a certificate, income tax should be withheld on all wages paid.