The Louisiana Department of Revenue (Department) has updated regulations governing the time nonresidents can work in the state without triggering the state income tax and withholding requirement to conform to legislation enacted in 2025 under H.B. 567. The updated regulations are effective March 20, 2026.

Background

Louisiana H.B. 567 increased the threshold for nonresident employee income tax and withholding from 25 to 30 days, effective January 1, 2026.

Under the updated law, employers are not required to withhold Louisiana nonresident income tax from wages paid to employees who perform services within the state for 30 or fewer days in the calendar year. If the working days in the calendar year exceed 30, the employer is required to remit and withhold nonresident income tax from all wages for services performed within the state, including wages earned for the first 30 days. (See Tax Alert 2025-1707.)

How the regulations changed

• The exemption period for nonresident employees is expanded from 25 days to 30 days per calendar year.
• Employers are required to begin withholding Louisiana income tax starting on the 31st day a nonresident employee performs services in Louisiana during the calendar year.
• The amendments remove prior provisions that tied the exemption to federal law or the employee's home-state rules.
• Nonresident individuals with other Louisiana-source income remain subject to Louisiana income tax filing requirements regardless of the number of days worked in the state.

Ernst & Young LLP insights

The regulatory update aligns Louisiana's administrative rules with recent statutory changes and provides employers with additional flexibility for short-term, mobile employees.