Louisiana Sales Tax Enforcement Actions Checklist
Louisiana's Department of Revenue uses enforcement actions when a business fails to comply with state sales and use tax laws. These collection actions include notices, audits, tax assessments, and payment procedures. An enforcement action does not happen suddenly; it typically follows missed filings, unpaid taxes, or discrepancies between what a business reported and what the state's records show.
Understanding what these actions mean and how they progress helps you respond appropriately and prevent escalation. Ignoring an enforcement action generally leads to larger penalty charges, interest, and more aggressive tax collection efforts. This checklist explains what Louisiana sales tax enforcement looks like, what typically happens next, and how to address it step by step.
What This Issue Means
A sales tax enforcement action is a formal notice or procedure that the Louisiana
Department of Revenue uses to address noncompliance with sales tax obligations. This can include a notice of unpaid sales and use tax liability, a demand for payment of back taxes, a notification that an audit will take place, a Notice of Assessment following an audit, or an intent to collect through wage garnishment, bank levy, or business seizure.
An enforcement action does not mean a criminal case has been filed. It is an administrative collection or compliance procedure under Louisiana law. The state has identified a tax problem and is now taking steps to resolve it through its official tax department processes.
Why the State Issued This or Requires This
The Louisiana Department of Revenue initiates enforcement actions under specific circumstances authorized by the Louisiana Legislature statutes. Common triggers include a business that did not file required sales tax returns on time, a sales tax return that was filed, but the tax payment was not made by the due date, or state records showing discrepancies between the amount of tax reported and the amount collected.
Other triggers include a previous notice or request for tax payment that went unanswered, or an audit that found unreported sales transactions or incorrect tax calculations. The state's enforcement goal is to collect unpaid tax debt, encourage future compliance, and ensure that all businesses (including small businesses, remote sellers with economic nexus, and marketplace facilitators) follow the same rules.
Once the Department of Revenue identifies a potential tax liability, it typically follows a series of steps: notice, opportunity to respond, assessment, and collection. These actions are part of routine administrative procedure and reflect the state's effort to enforce sales and use tax law uniformly across all taxpayers.
What Happens If This Is Ignored
Failing to respond to a sales tax enforcement action typically results in an escalation under Louisiana law. The state may issue a formal tax assessment of the tax owed, plus penalties and interest. Collection actions may intensify, including wage garnishment or bank levies on your bank account.
The state may place a lien on business assets or property under Revised Statutes
47:1569, which authorizes the secretary to initiate distraint and sale proceedings.
Additional penalty charges may be added for continued noncompliance. The case may eventually result in seizure of business assets or equipment.
Each ignored notice makes the situation more serious and more complex to resolve.
The longer a taxpayer waits to respond, the larger the total tax debt becomes because interest and penalties accumulate. Responding to an enforcement action, even if you disagree with it, preserves your right to challenge it and often stops further escalation while the matter is being addressed.
What This Does NOT Mean
An enforcement action is not a criminal proceeding. It is a civil tax collection matter handled by the Department of Revenue's administrative processes under Louisiana law.
An enforcement action does not automatically mean your business license will be revoked, though severe noncompliance can lead to license suspension or revocation through separate state procedures.
An enforcement action does not automatically result in seizure of assets; that is a later step that typically occurs only after notice and opportunity to pay have been given. An enforcement action does not prevent you from filing future sales tax returns or continuing to operate; it requires you to address the past liability while staying current with future tax payments.
Checklist: What to Do After Receiving or Identifying a
Sales Tax Enforcement Action
Follow these steps in order. Complete each step fully before moving to the next.
Step 1: Read the Notice Completely and Identify What It Is
Locate the notice or letter from the Louisiana Department of Revenue. Read the entire document, including any attached forms or exhibits. Write down the notice date, notice number, and the specific amount of tax claimed.
Identify what type of enforcement action this is (demand for payment, notice of audit,
Notice of Assessment, etc.). Note any deadline mentioned in the notice for responding or paying. Understanding the specific type of notice helps you determine the appropriate response.
Step 2: Gather All Relevant Business Records
Collect all sales tax returns filed for the period in question. Find receipts, invoices, and point-of-sale records for that period showing all sales transactions. Locate bank statements showing deposits and sales.
Gather any correspondence with the Department of Revenue about this matter.
Organize records by month or quarter to match the period cited in the notice. Having complete documentation is essential for verifying the accuracy of any tax assessment.
Step 3: Verify the Accuracy of Information in the Notice
Compare the periods listed in the notice to the periods on your filed returns. Check whether the tax amounts claimed match what you reported on your sales tax return.
Confirm the business name and identification number on the notice.
Verify that the notice addresses your current business location and contact information.
Note any discrepancies or errors in the notice. If you identify errors, document them clearly for your response.
Step 4: Determine Your Response Deadline
Locate the date by which you must respond in the notice. If the notice includes a specific deadline, write it down clearly. If you are unsure about the deadline, contact the
Louisiana Department of Revenue at 855-307-3893 to confirm.
Mark the deadline prominently on your calendar. Plan to respond several days before the deadline to allow for processing time. Missing the deadline can result in losing your right to appeal to the Louisiana Board of Tax Appeals.
Step 5: Decide Whether to Pay, Contest, or Request Assistance
Before responding, understand your options under Louisiana law. Pay the full amount if you believe the assessment is correct; contact the Department of Revenue for tax payment instructions through LaTAP File & Pay or other approved methods. Pay part of the amount and request a hearing if you disagree with part of the assessment; this shows good faith while preserving your right to challenge.
Request a hearing or appeal if you believe the assessment is entirely incorrect; the notice should explain how to request this through the Board of Tax Appeals. Request an
Installment Agreement if you cannot pay the full amount immediately; the Department of
Revenue may allow payment plans of at least 6 months. Request penalty abatement if penalty charges were assessed and you have a reasonable cause for late payment or filing; this is a separate request process.
Step 6: Prepare Written Correspondence to the Department of Revenue
Write a letter addressing the notice by its number and date—clearly state which option
above you are choosing (pay, contest, request plan, etc.). If contesting, explain briefly
and factually why you believe the tax assessment is incorrect.
Include copies (not originals) of supporting documents that prove your position, such as sales tax returns, invoices, or bank account statements. Do not make emotional arguments or accusatory statements. Keep the letter professional and organized, sign and date it.
Step 7: Send Your Response to the Correct Address
Do not send responses to a local office unless the notice specifies one. Mail or deliver to the address listed on the notice for correspondence. Use certified mail with a return receipt to have proof of delivery.
Keep a copy of everything you send for your records. Note the date you mailed the response. Proper documentation protects your rights under Louisiana law.
Step 8: Monitor for Follow-Up Communication
Expect to receive acknowledgment of your response within 15 to 30 days. If you do not receive a response within 45 days, contact the Department of Revenue to confirm receipt. Keep all future correspondence related to this enforcement action in a single file.
Do not discard any notices or letters from the state, even if you disagree with them.
Respond promptly to any follow-up requests for information or documentation.
Maintaining organized records helps resolve the matter efficiently.
Step 9: If a Payment Plan Is Needed, Complete the Application Process
Request an Installment Agreement application from the Department of Revenue if you cannot pay in full. Complete the application with accurate financial information showing your bank account details and payment capacity. Explain your situation clearly but briefly.
Apply by any deadline specified in the notice. Await approval before assuming a payment plan is in place. Interest and penalty charges continue to accrue during the installment period.
- Ignoring the notice entirely allows the state to move forward with collection
- Sending tax payments to the wrong address may result in costs not being
- Not keeping copies of everything prevents you from tracking your case's status;
- State enforcement notices and responses
- Sales tax audits, assessments, and collections
- Payroll & trust fund tax enforcement issues
- Penalty and interest reduction options
- Payment plans and state tax relief eligibility
- Representation before state tax agencies
Step 10: Continue Filing and Paying Current Sales and Use Tax Obligations
Do not stop filing sales tax returns while an enforcement action is pending. Continue to pay sales tax by the due date (the 20th of the month following the reporting period) for all current periods. If you cannot pay the current tax, this will create additional collection actions.
File returns even if you cannot pay; filing, even if underpaying, is better than not filing at all. Keep records showing that you are staying current. This demonstrates good faith compliance with Louisiana sales and use tax law.
What Happens After This Is Completed
Once you have responded to an enforcement action, the Louisiana Department of
Revenue typically reviews your response and supporting documentation. If you paid in full, it processes the tax payment and closes the enforcement action. If you contested or requested a hearing, the Board of Tax Appeals will schedule a hearing or appeals review. You will receive notice at least 60 days before the scheduled hearing date.
If you requested an Installment Agreement, it reviews your financial information and issues an agreement outlining monthly payment amounts and due dates. The state does not usually close an enforcement action immediately after receiving your response. Until you receive formal notice that the matter is resolved, continue following the terms of any agreement you made and keep all future correspondence.
Common Mistakes to Avoid actions without your input. This results in larger penalty charges and more aggressive tax collection methods under Revised Statute 47:1569. Missing the response deadline causes you to lose the right to contest the tax assessment or request a hearing with the Louisiana Board of Tax Appeals; paying late does not restore your right to appeal. credited to your account; always use the address listed on the notice or pay through LaTAP File & Pay. Providing incomplete or disorganized documentation may cause the state to proceed with the original assessment if it cannot understand your supporting materials. the state's records and yours may differ at times. Continuing to underreport or underpay current tax during an enforcement action creates additional violations and compounds the original tax debt. Assuming an Installment Agreement was approved without confirmation can cause problems; until you receive a written agreement, do not assume a payment plan is in effect.
Frequently Asked Questions
How long does a sales tax enforcement action typically take to resolve?
This depends on whether you pay immediately, request a hearing, or enter an
Installment Agreement. If you pay in full, resolution may occur within 30 to 60 days. If you request a hearing with the Board of Tax Appeals, the process may take longer. The state does not publish fixed timeframes for all enforcement actions.
Can I request a payment plan even if the notice does not mention one?
Yes. You can request an Installment Agreement by contacting the Louisiana Department of Revenue or by including a request in your written response to the enforcement notice. The state will evaluate your request based on your financial situation and bank account information. Payment plans must be a minimum of six months under Louisiana law.
Will this enforcement action show up on a credit report?
No. Tax liens and enforcement actions do not appear on personal credit reports. As of
April 2018, the three major credit bureaus (Equifax, Experian, TransUnion) stopped including tax liens on credit reports entirely. However, tax liens remain public records and can be discovered through other means.
What if I believe the tax assessment is wrong, but cannot afford to pay while I appeal?
You have several options under Louisiana law. You can pay part of the amount, request an Installment Agreement for the remainder, and request a hearing on the disputed portion with the Louisiana Board of Tax Appeals. You can also request a stay of
collection (a delay in enforcement) while your appeal is pending, though approval is not guaranteed.
Can I get the penalty charges reduced or removed?
The Louisiana Department of Revenue has a penalty abatement process for reasonable cause. If you have a documented reason for the late filing or payment (such as illness, business closure, or reliance on incorrect advice), you can submit a request explaining the circumstances. The secretary may waive penalty charges if the delay was due to reasonable cause rather than negligence.
What if I no longer have records from the period in question?
Explain this in your response to the notice. You can request that the state work with you to reconstruct sales transactions from available bank account records or other documentation. Cooperating in this process is better than ignoring the notice.
Will an enforcement action affect my business license?
Sales tax enforcement actions do not automatically suspend or revoke a business license. However, if tax debt remains unpaid after all collection efforts, the state may pursue license suspension through a separate administrative process. You have 60 days from the date you receive notice to prevent suspension or revocation by paying the delinquent taxes or entering an Installment Agreement.
What if I disagree with the entire enforcement action?
Request a hearing with the Louisiana Board of Tax Appeals. You will have the opportunity to present your position and evidence before a hearing officer or
administrative judge. You have 60 days from the date of the Notice of Assessment to file an appeal. The notice should explain how to request a hearing.
Facing State Tax Enforcement Action?
If you’ve received a notice related to sales tax or payroll tax enforcement and are unsure how to respond, our team can help you understand your options and next steps.
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