Louisiana · Work Opportunity Tax Credit (WOTC)
Work Opportunity Tax Credit (WOTC) in Louisiana (2026)
Employers can claim up to $9,600 per eligible employee hired from targeted groups including veterans, long-term unemployed, and SNAP recipients. Louisiana has a flat 3% income tax, so a Louisiana filer's combined marginal rate on the next dollar at $52,800 of income is about 15% (12% federal + 3% LA).
2026 savings example for Louisiana
Planning estimate for a single filer earning $52,800 (Louisiana median household income in LevyIO's state dataset) who claims a $5,000 credit. Federal tax uses the 2026 IRS brackets after the $16,100 standard deduction; LA tax uses the state brackets in LevyIO's dataset and assumes the state follows the federal treatment.
Estimated total savings
$4,156
Federal savings
$4,156
$4,156 → $0 · 12% bracket
LA state savings
$0
Federal credit only; check for a state credit
Combined marginal rate
15%
Credits do not depend on the bracket
Statutory maximum for this item in LevyIO's dataset: $9,600.
Federal × Louisiana marginal rates (2026, single)
Gross-income ranges include the federal standard deduction. The LA column is the state marginal rate at the midpoint of each range. A credit saves its face value regardless of bracket.
| Federal bracket | Gross income (single) | LA marginal | Combined | Per $1,000 |
|---|---|---|---|---|
| 10% | $16,100 - $28,500 | 3% | 13% | $1,000 |
| 12% | $28,500 - $66,500 | 3% | 15% | $1,000 |
| 22% | $66,500 - $121,800 | 3% | 25% | $1,000 |
| 24% | $121,800 - $217,875 | 3% | 27% | $1,000 |
| 32% | $217,875 - $272,325 | 3% | 35% | $1,000 |
| 35% | $272,325 - $656,700 | 3% | 38% | $1,000 |
| 37% | Over $656,700 | 3% | 40% | $1,000 |
Eligibility & forms
Employers who hire individuals from targeted groups
- Employee must be from a targeted group (veterans, ex-felons, etc.)
- Must file Form 8850 within 28 days of hire
- Employee must work minimum 120 hours
Federal forms: Form 5884, Form 8850
Louisiana filing notes
Low 3% rate and federal standard deduction simplify planning. Be aware of very high combined sales tax. Louisiana offers homestead exemption on first $75,000 of assessed value. Social Security is fully exempt.
Common mistakes: Missing the 28-day filing deadline; Not pre-screening applicants before hire date; Failing to track hours worked for credit calculation.
Frequently asked questions
How much can the Work Opportunity Tax Credit (WOTC) save a Louisiana taxpayer in 2026?
Credits reduce tax dollar-for-dollar. In LevyIO's example, a single filer with $52,800 of income (the Louisiana median household income in our state dataset) and a $5,000 credit would cut 2026 federal tax from $4,156 to $0, a $4,156 saving. Whether Louisiana offers a matching state credit depends on the LA return, so the estimate counts federal savings only.
What is the Louisiana income tax rate for 2026?
Louisiana has a flat 3% income tax. The LA standard deduction in LevyIO's dataset is $14,600 single / $29,200 married. Flat 3% (2025). Uses federal standard deduction. Highest average combined sales tax (10.11%, Tax Foundation 2026). Low property taxes.
Who qualifies for the Work Opportunity Tax Credit (WOTC) in Louisiana?
Employers who hire individuals from targeted groups. The federal rules are the same in every state; the requirements are: Employee must be from a targeted group (veterans, ex-felons, etc.); Must file Form 8850 within 28 days of hire; Employee must work minimum 120 hours. Louisiana filers should confirm on the LA return whether the state follows the federal treatment.
Which forms do I file to claim the Work Opportunity Tax Credit (WOTC)?
Federal: Form 5884, Form 8850. Louisiana: check the Louisiana Department of Revenue instructions for the matching state schedule. Common mistakes: Missing the 28-day filing deadline; Not pre-screening applicants before hire date; Failing to track hours worked for credit calculation.
Work Opportunity Tax Credit (WOTC) in other states
Sources
Reviewed 2026-09-17. Estimates are educational planning figures computed from the IRS 2026 inflation adjustments and LevyIO's state bracket dataset; they are not tax advice.