What interest and dividends are eligible for exclusions from Louisiana income tax?
Louisiana exempts interest and dividends earned on federal obligations and obligations from the State of Louisiana and its political subdivisions and municipalities. • Interest and dividends from all state and local government obligations are exempt from federal income tax. Louisiana only exempts interest and dividends from obligations from the State of Louisiana and its political subdivisions and municipalities. Since interest and dividends from obligations of the State of Louisiana and its political subdivisions and municipalities are exempt from both federal and Louisiana income tax, no adjustment is required on Schedule E because the interest and dividends are not included in federal adjusted gross income. • Interest and dividends from obligations from other states or their political or municipal subdivisions are exempt from federal income tax but taxed by Louisiana. These amounts must be reported on Schedule E, line two and will be added to the taxpayer’s Louisiana adjusted gross
