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R -10610-ITEi (1/20)
INSTRUCTIONS
All taxpayers that are included on the same consolidated federal income tax return are required to combine their inventory taxes paid in
order to determine the amount of the excess credit that is refundable. Taxpayers that are affiliated or related outside of a consolidated group
are not required to combine their taxes paid in order to determine the amount of the excess credit that is refundable.
GENERAL INSTRUCTIONS
1. This worksheet was designed to assist the following taxpayers in calculating the credit and provide necessary computation to LDR:
• A manufacturer who has claimed the property tax exemption under the Industrial Tax Exemption Program (ITEP) during the
taxable year in which the local inventory taxes were levied; or
• Members of a consolidated federal income tax return that includes a manufacturer who has claimed the property tax
exemption under ITEP.
2. If you are one of the taxpayers described in #1 above, your credit is limited to tax and the excess can be carried forward not to
exceed five years.
3. This form should be used for tax year 2019.
4. Enter the Taxpayer’s name, SSN/LDR Account ID and filing period for the return to which this worksheet is attached in the space
provided. Check the box for the credit type you are calculating on this worksheet.
GENERAL INSTRUCTIONS
1A. Enter the amount of the ad valorem taxes paid to local subdivisions in Louisiana on inventory held by manufacturers, distributors, and
retailers OR natural gas held, used, or consumed in providing natural gas storage services or operating natural gas storage.
1B. Enter the amount of Line 1A that is the ad valorem taxes paid to local subdivisions in Louisiana on inventory held by manufacturers,
distributors, and retailers that is available for or subject to a short-term rental that will subsequently or ultimately be sold by the
retailer that will be included on Line 1C.
For the purpose of this credit, inventory is defined in R.S. 47:6006 as items of tangible personal property that are held for sale
in the ordinary course of business, in the process of production for subsequent sale, or are to physically become a part of the
production of such goods. The definition contains a listing of specific items that are included and not included in inventory. In
addition to items that are clearly included by the definition, the following items are included in inventory: used goods or trade-in
merchandise; by-products of a manufacturer; raw materials and supplies that will be consumed in the Louisiana manufacturing
process; and goods that are available for short-term rental that will subsequently or ultimately be sold by taxpayers classified under
code numbers 532412 and 532310 of the North American Industry Classification System. A “short-term rental” is defined as a
rental of an item of tangible personal property for a period of less than 365 days, for an undefined period, or under an open-ended
agreement.
Not included in inventory unless otherwise stated are: oil stored in tanks held by a producer prior to the first sale of the oil; items
that have been leased by the taxpayer; items that the taxpayer has depreciated for federal income tax purposes; items that have
been used by the taxpayer and have been owned for more than eighteen months; and certain items stored in the state for use in
interstate commerce.
1C. Enter the amount of ad valorem taxes paid to local subdivisions in Louisiana on inventory held by manufacturers, distributors,
retailers OR natural gas held, used, or consumed in providing natural gas storage services or operating natural gas storage
reported on Line 1A that meets the definition of inventory under R.S. 47:6006. Your credit for the inventory held is limited to tax and
the excess can be carried forward not to exceed five years.
2. Enter the amount of your adjusted tax liability from your tax return. See chart below for line numbers.
Tax Year IT-540 IT-540B IT-540BNRA IT-541 R-6922 CIFT-620
2019 Line 23 Line 22 Line 21 Line 19 Line 11 Line 16
3. Amount of the credit exceeding tax liability. Subtract Line 2 from Line 1C. If less than zero, enter zero.
If Line 3 is equal to zero, your entire credit on Line 1C will be used to offset tax. Enter the amount from Line 1C on Schedule
NRC-P3 (Business) or Schedule J (Individual) with the identifying three-digit code listed below. If Line 3 is greater than zero, Line
3 is your credit carry forward and the amount on Line 2 is the amount of the credit that can be used to offset tax. Enter the amount
from Line 2 on Schedule NRC-P3 or Schedule J with the identifying three-digit code listed below.
Inventory Tax Credit Carried Forward and ITEP 218
Ad Valorem Natural Gas Carried Forward 219
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