Louisiana Payroll Tax Payment Plan Options Checklist
Louisiana withholding tax is the state income tax that employers withhold from employee paychecks and remit to the Louisiana Department of Revenue. Businesses must pay these taxes on a regular schedule, based on the amount withheld. If your business owes withholding tax and cannot pay the full amount by the deadline, the state may allow you to enter an installment agreement.
Understanding your Louisiana payroll tax payment plan options helps you stay in compliance while managing cash flow. Ignoring a tax debt can lead to penalties and interest, liens against your business, and wage garnishment actions. Payment plans are designed to help companies meet their tax liabilities without incurring escalated collection actions.
Note that the unemployment insurance tax is separate from the withholding tax and is administered by the Louisiana Workforce Commission, not the Louisiana Department of
Revenue. This checklist applies only to withholding tax payment plans through the
Louisiana government tax system.
What This Issue Means
A Louisiana withholding tax payment plan is a formal installment agreement between your business and the Louisiana Department of Revenue that allows you to pay your owed business taxes over time rather than in a lump sum. The plan outlines the payment amount, payment schedule, and due dates. Once approved, the state expects
you to make payments under the agreement through the Louisiana Taxpayer Access
Point system or by automatic bank debit.
If approved, you remain liable for the full tax debt, plus any penalties and interest already assessed. The payment plan covers only the debt that existed at the time of approval for specific tax years.
Why the State Offers This Option
Louisiana law requires businesses to remit withholding taxes on specific schedules throughout the year using Form L-1, Employer Return of State Income Tax Withheld, and Form L-1V, Withholding Payment Voucher. Some businesses face temporary cash flow problems and cannot pay the full amount when due. The state offers payment plans as an administrative option to encourage compliance rather than abandonment of unpaid taxes.
Payment plans allow the state to collect owed taxes while helping legitimate businesses continue operating. This approach prevents more severe collection actions, such as bank levies or tax lien filings.
What Happens If This Is Ignored
If you have been offered a payment plan or told you are eligible for one but do not apply, the Louisiana Department of Revenue will continue its standard collection process. This may include assessing additional penalties and interest on the unpaid balance. The state may file a tax lien against your business, which affects credit and financing options.
Wage garnishment or seizure of business assets may occur without a formal agreement. Without a payment plan, you have no protected payment schedule and remain subject to full collection enforcement under state laws.
Checklist: Louisiana Withholding Tax Payment Plan
Options
Step One: Determine Your Current Tax Debt
1. Obtain a current account statement from the Louisiana Department of Revenue showing the exact amount owed, including taxes, penalties, and interest.
2. Contact the Louisiana Department of Revenue at 855-307-3893 or visit the official website at revenue.louisiana.gov to request your Louisiana Revenue
Account Number balance.
3. Document the tax period or periods for which you owe withholding tax.
4. Note the payment due date and the current date to determine how long the debt has existed.
5. Confirm whether penalties and interest have already been assessed on your account.
Step Two: Understand Your Payment Plan Options
1. Review the Louisiana Department of Revenue's official website for published payment plan policies specific to payroll tax obligations.
2. Note that Louisiana allows installment agreements for unpaid business tax obligations with a minimum duration of six months.
3. Determine whether you qualify for a standard installment agreement based on the amount owed and your business capacity to pay.
4. Understand that payment plan terms may vary depending on the total amount owed and other factors the state considers under state-specific rules.
5. Be aware that a nonrefundable installment agreement fee of $105 is required to establish an installment agreement with the state.
Step Three: Gather Required Financial Documentation
1. Prepare your most recent Louisiana income tax return or business registration information showing your employer responsibilities.
2. Compile recent bank statements showing business account activity and available cash flow.
3. Gather payroll records for the tax period or periods in question, including copies of Form L-1 if available.
4. Document any other outstanding state or federal tax obligations, including federal taxes owed to the Internal Revenue Service.
5. Prepare a brief explanation of why you cannot pay the full amount immediately if requested by the collection process staff.
Step Four: Contact the Louisiana Department of Revenue
1. Call the Louisiana Department of Revenue at 855-307-3893 during business hours (Monday through Thursday 8:00 AM to 4:20 PM; Friday 9:00 AM to 4:20
PM).
2. Explain that you have an unpaid withholding tax balance and want to discuss payment plan options for your tax liability.
3. Ask about the formal process for applying for an installment agreement through
LaTAP or a paper application.
4. Request the agent's name and direct contact information for your account.
5. Ask what documentation you need to provide, including whether sharing sensitive information requires specific security protocols.
Step Five: Submit a Payment Plan Request
1. Apply for a payment plan online through the Louisiana Taxpayer Access Point
(LaTAP) at latap.revenue.louisiana.gov if you have an existing account for LaTAP
File & Pay services.
2. Alternatively, complete Form R-19027 (Installment Request for Business Taxes)
and submit it by email to Business.Tax@LA.GOV or by mail to Louisiana
Department of Revenue, Business Tax Enforcement Division, P.O. Box 4969,
Baton Rouge, LA 70821-4969.
3. Include your business name, Louisiana Revenue Account Number, federal employer identification number, and current contact information.
4. State the total amount you owe and the amount you can pay monthly toward your tax debt.
5. Propose a payment schedule you believe you can meet (minimum six months required by state laws).
Step Six: Pay the Required Fee
1. Submit the nonrefundable $105 installment agreement fee along with your application through the Louisiana Tax system.
2. The fee must be paid electronically at latap.revenue.louisiana.gov or by mail with your application.
3. Understand that the fee cannot be paid in installments, waived, or applied against any tax debt under current Louisiana payroll tax administration rules.
4. Note that failure to submit the fee may result in the denial of your request.
5. Keep proof of payment for your records in case of disputes during collection.
Step Seven: Set Up Automatic Bank Debit
1. Complete the Bank Debit Application included on page two of Form R-19027 for
Electronic Funds Transfer setup.
2. Understand that the Louisiana Department of Revenue requires automatic bank debit for payment of the agreement under current payroll tax laws.
3. Provide your bank routing number, account number, and account type (checking or savings) for the Electronic Funds Transfer system.
4. Attach a voided check as required by the form instructions to verify your bank account information.
5. Specify the debit date and debit amount you prefer for monthly payments toward your business tax debt.
Step Eight: Await the State's Decision
1. Wait for written notification from the Louisiana Department of Revenue regarding approval or denial of your installment agreement request.
2. Do not assume approval until you receive official written confirmation from government websites or by mail.
3. If denied, ask the state what alternative options exist or what additional information they need to reconsider.
4. Continue tracking your account balance, as penalties and interest may still accrue while your application is under review.
5. Begin making monthly payments even if you have not yet received a response from the Louisiana Department of Revenue to demonstrate good faith.
Step Nine: Review the Approved Payment Plan Agreement
1. Once approved, receive and review the formal payment plan agreement from the state through mail or the Louisiana Taxpayer Access Point portal.
2. Confirm that the payment amount, due date, and frequency match what you discussed with the collection process representative.
3. Check that the agreement specifies the total tax, penalties, and interest included in your tax liability.
4. Verify the final payoff date and total number of payments required under the installment agreement.
5. Note any conditions or requirements stated in the agreement regarding ongoing filing and payment of current period taxes.
Step Ten: Maintain Compliance with Current Obligations
1. Make payments according to the automatic bank debit schedule established in your agreement through Electronic Funds Transfer.
2. Ensure sufficient funds are in your account on each debit date to avoid nonsufficient funds fees and default of the agreement.
3. File all future withholding tax returns on time using Form L-1 Employer Return of
State Income Tax Withheld, even while you are paying off the past debt.
4. Remit any new payroll taxes due when they become due using Form L-1V
Withholding Payment Voucher or online payment vouchers to avoid adding to your existing debt.
5. Understand that a payment plan covers only the debt that existed at the time of approval for specific tax years; new unpaid taxes will be treated as separate obligations.
What Happens After Approval
Once your payment plan request is approved, the Louisiana Department of Revenue will send you a formal agreement outlining your obligations. You are then expected to begin making payments on schedule through automatic bank debit or Electronic Funds
Transfer. Under state law, interest typically continues to accrue on the unpaid balance during the payment plan period.
If you miss a payment or fail to stay current with your ongoing tax obligations using
Form L-1 and Form L-1V, you will be in default of your agreement, and the total outstanding balance becomes immediately due. At that point, all collection actions, including potential bank levy or wage garnishment, will be reactivated. You may contact the Louisiana Department of Revenue to request reinstatement of your installment agreement. Still, you will need to pay a mandatory $60 reinstatement fee or a new $105 installment agreement fee if the deal has been cancelled for 90 days or longer.
Common Mistakes to Avoid
- Failing to respond to state notices can result in the denial of the payment plan. If
the Department of Revenue requests additional information or documentation, respond promptly to avoid escalation of collection actions.
- Missing payments under the payment plan can trigger default of the agreement
and escalate the collection process. Ensure sufficient funds are available on each automatic debit date.
- Assuming approval without written confirmation is a mistake. Do not consider a
payment plan approved until you receive official written documentation from the state through mail or the Louisiana Taxpayer Access Point system.
- Providing incomplete or inaccurate financial information can result in denial or
default. The state bases approval decisions on the information you provide when sharing sensitive information.
- Neglecting to file current-year tax returns while under a payment plan violates
your agreement. A payment plan covers only past debt; you remain responsible for timely filing and payment of new obligations using the proper forms and the
LaTAP File & Pay system.
Additional Considerations
If you also owe unemployment insurance taxes, contact the Louisiana Workforce
Commission separately at 225-326-6999 or through the Louisiana Wage and Tax
System. The Louisiana Workforce Commission administers unemployment taxes separately from the Louisiana Department of Revenue. Payment plans for unemployment insurance require a different process through government websites managed by the Louisiana Workforce Commission.
If you owe federal taxes to the Internal Revenue Service in addition to state tax debt, those require separate payment arrangements. The Internal Revenue Service offers its own installment agreements and tax relief options that are independent of Louisiana state payment plans.
Understanding the differences between state and federal tax obligations helps you adequately address all outstanding liabilities. Resolving state income taxes through the
Louisiana Department of Revenue does not resolve any federal payroll tax obligations you may have with the Internal Revenue Service.
Facing State Tax Enforcement Action?
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