How to Fill Out Louisiana Form R-10606: Columns, Credit, and Common Mistakes

Louisiana Form R-10606 is the Supplemental Worksheet for Credit for Taxes Paid to Other States, and you attach it to your Louisiana Form IT-540 (individual) or IT-541 (fiduciary) whenever you want credit for income tax you paid to another state on income Louisiana also taxes.¹ The worksheet runs you through a nine-column calculation that compares what you actually paid the other state against the Louisiana tax attributable to that same income, and the smaller of the two numbers becomes your credit.

Before You Decide to File It

Louisiana gives this credit under La. R.S. 47:33 to residents (and to resident estates and trusts) for net income tax paid to another state on income that is also taxable in Louisiana.²³

One qualifier blocks more claims than any other. The credit is available only when the other state does not give its nonresidents a credit for taxes paid to their home state. If that state already lets you offset its tax with your Louisiana liability, Louisiana will not also credit you on this end. The Department of Revenue identifies the qualifying states in Revenue Information Bulletin 16-052. Check that bulletin first; if your state is on the wrong side of the list, nothing in the worksheet will change the result.²

Three other statutory limits apply. Only income taxes count, not sales, property, or local city taxes.³ The credit must be claimed for the same taxable period in which the other-state liability arose, regardless of your accounting method. And if you take the credit you cannot also deduct the same tax as an itemized deduction on your Louisiana return.²

What to Have in Front of You

You cannot complete the worksheet from memory or from your pay stubs. Pull the following together first:

The final return you filed with the other state, showing taxable income and net tax liability. The worksheet instructions are explicit that W-2 or 1099 withholding is not acceptable; you need the actual tax shown on that state’s return. The one exception is Mississippi gambling winnings, where the amount on Form W-2G is used.¹
Your Louisiana return completed through the tax calculation. The worksheet pulls your Louisiana adjusted gross income, your total deductions, your tax table income, and your computed income tax from specific lines of the IT-540 or IT-541.
If an entity-level tax was paid for you by a partnership or S corporation, the composite return and your Schedule K-1.⁴

Copies of every other-state return must be attached to your Louisiana return along with the worksheet itself. Leaving them out is one of the fastest ways to have the credit held up.⁴

Working Through the Nine Columns

The worksheet gives you fourteen rows for individual states, plus a totals line (Line 15). Each row handles one state. If you paid tax to more than fourteen states, complete additional worksheets and combine the Line 15 totals.¹

Columns 1 Through 5: The Other State’s Share of Your Income

Column 1 is the two-letter state abbreviation. Column 2 is the income that was taxable to that state and also taxable to Louisiana, taken from the other state’s return. For IT-540 filers, the sum of Column 2 across all rows cannot exceed Line 7 of the IT-540 (or Schedule E, Line 1, if used).

Column 3 turns that income into a ratio: divide Column 2 by your Louisiana adjusted gross income from IT-540, Line 7 (or the corresponding IT-541 line), and round to two decimal places. Column 4 applies that ratio to your Louisiana deductions, multiplying your total deductions by the Column 3 percentage and rounding to the nearest dollar. Column 5 is simply Column 2 minus Column 4, leaving the tax table income attributable to the other state.¹

Columns 6 and 7: Louisiana’s Tax on That Slice

Column 6 is a second ratio. Divide Column 5 by your total Louisiana tax table income from the IT-540 or IT-541, rounded to two decimal places. Column 7 multiplies that ratio by your Louisiana income tax (IT-540, Line 10, or IT-541, Line 7, depending on the form year), rounded to the nearest dollar.⁵ Column 7 is the ceiling: it represents the amount of Louisiana tax that would have been imposed on that income had it been earned in Louisiana, and Louisiana will not credit more than that.

Columns 8 and 9: The Credit Itself

Column 8 is the net tax liability you actually paid to the other state, as shown on that state’s return after its own credits and payments. Not withholding.¹ Column 9 is the lesser of Column 7 or Column 8 for that row. That is the credit for that state. Louisiana will match your other-state payment dollar for dollar, but only up to the Louisiana tax on the same income.²

Line 15 and Where the Totals Go

Add Columns 8 and 9 down the page and enter the sums on Line 15. On the IT-540, the Column 8 total goes to Schedule C, Line 1A and the Column 9 total goes to Schedule C, Line 1B. If you used more than one worksheet, combine the Line 15 figures before entering them. IT-541 filers carry the Column 9 total to Line 10 of the fiduciary return.⁴³

How the Credit Behaves on Your Louisiana Return

On the IT-540, the credit is a Nonrefundable Priority 1 Credit reported on Schedule C. Two things follow from that label. First, nonrefundable means the credit can zero out your Louisiana tax but will not generate a refund on its own, and any excess is lost for the year. Second, Priority 1 means it applies ahead of other nonrefundable credits, so it uses your Louisiana tax liability first. The Schedule C, Line 6 total flows to IT-540, Line 12.⁶

The worksheet is not filed separately. It travels with the IT-540 or IT-541 as an attachment, along with copies of every other-state return.⁴

If a Partnership or S Corporation Paid the Tax for You

Partners, LLC members, and S corporation shareholders can still qualify when another state’s entity-level tax was paid on their behalf. For taxes paid on or after January 1, 2018, La. R.S. 47:33 allows the credit to an individual owner whose share of the other state’s entity-level income tax is based solely on net income included in the entity’s federal taxable income.² Attach the other state’s composite return and your K-1 to the Louisiana return along with the R-10606.⁴

Mistakes That Delay or Lose the Credit

The most common error is dropping W-2 withholding into Column 8 instead of the actual bottom-line tax from the other state’s return. The two numbers rarely match. If Mississippi withheld $2,500 but your Mississippi return shows a final liability of $2,100, the $2,100 is the correct figure.¹

The second is claiming the credit for a state that already gives nonresidents a reciprocal credit against its own tax. Confirm your state against Revenue Information Bulletin 16-052 before filing.²

The third is failing to attach copies of the other-state returns. Without them, the Department of Revenue will hold the credit while it requests verification. And if you later receive a refund from the other state that changes the tax you paid, La. R.S. 47:33 requires you to notify the Louisiana Secretary of Revenue so the credit can be recalculated; ignoring that duty can lead to an adjusted assessment and interest.²

Watch the Line Number References

The specific IT-540 and IT-541 line numbers printed on R-10606 change when the Department of Revenue redesigns those returns. The instructions printed on the worksheet itself match the line numbering for its own tax year. If you are using a prior-year R-10606 against a current-year IT-540, verify every line reference before you copy numbers across; the version you downloaded controls over any older guidance.

1
Louisiana Department of Revenue. Supplemental Worksheet for Credit for Taxes Paid to Other States for Forms IT-540 and IT-541
2
Justia. Louisiana Revised Statutes 47:33 – Credit for Taxes Paid in Other States
3
Louisiana Department of Revenue. General Information and Instructions for Completing Form IT-541
4
Louisiana Department of Revenue. Instructions for Louisiana 2024 Individual Income Tax
5
Louisiana Department of Revenue. Supplemental Worksheet for Credit for Taxes Paid to Other States for Forms IT-540 and IT-541
6
Louisiana Department of Revenue. IT-540 2025 Louisiana Resident Individual Income Tax Return