Use Louisiana's RIB 26-019 2026 standard deduction and retirement exemption

changelog.d/la-2026-rib-26-019.fixed.md

@@ -0,0 +1 @@
+Use Louisiana's official 2026 standard deduction ($12,838 single or separate, $25,676 joint, head of household or surviving spouse) and age-65 retirement income exemption ($12,324) from LDR Revenue Information Bulletin 26-019, and project both after 2026 with La. R.S. 47:294(B) and 47:44.1(A)'s annual CPI-U adjustment, using BLS's not seasonally adjusted December CPI-U (new gov.bls.cpi.cpi_u_nsa_december) where published.

policyengine_us/parameters/gov/bls/cpi/cpi_u_nsa_december.yaml

@@ -0,0 +1,26 @@
+description: The Bureau of Labor Statistics publishes this December value of the Consumer Price Index for All Urban Consumers, not seasonally adjusted, from which it reports the index's December-over-December percentage change.
+values:
+  # BLS series CUUR0000SA0 (U.S. city average, all items, 1982-84=100).
+  2012-12-01: 229.601
+  2013-12-01: 233.049
+  2014-12-01: 234.812
+  2015-12-01: 236.525
+  2016-12-01: 241.432
+  2017-12-01: 246.524
+  2018-12-01: 251.233
+  2019-12-01: 256.974
+  2020-12-01: 260.474
+  2021-12-01: 278.802
+  2022-12-01: 296.797
+  2023-12-01: 306.746
+  2024-12-01: 315.605
+  2025-12-01: 324.054
+metadata:
+  unit: currency-USD
+  label: CPI-U, not seasonally adjusted, December
+  economy: false
+  reference:
+    - title: BLS | CPI-U, U.S. city average, all items, not seasonally adjusted (CUUR0000SA0)
+      href: https://data.bls.gov/timeseries/CUUR0000SA0
+    - title: Consumer Price Index News Release - 2025 M12 Results
+      href: https://www.bls.gov/news.release/archives/cpi_01132026.htm

policyengine_us/parameters/gov/states/la/tax/income/deductions/standard/amount.yaml

@@ -3,36 +3,40 @@ metadata:
   period: year
   unit: currency-USD
   label: Louisiana standard deduction amount
-  uprating: gov.bls.cpi.cpi_u
+  # Years after the last value below follow R.S. 47:294(B)'s annual CPI-U
+  # adjustment, computed by extend_la_cpi_u_indexed_amounts in
+  # policyengine_us/parameters/uprating_extensions.py.
   propagate_metadata_to_children: true
   breakdown:
     - filing_status
   reference:
     - title: Louisiana Revised Statutes, RS 47:294 - Standard deduction
       href: https://www.legis.la.gov/legis/Law.aspx?d=101761
-    - title: Louisiana Register, February 20, 2026, Income Tax Withholding Tables notice
-      href: https://bese.louisiana.gov/docs/default-source/rulemaking-docket/feb-louisiana-register.pdf#page=127
+    - title: Louisiana Department of Revenue, Revenue Information Bulletin 26-019 (September 28, 2026), Inflation Adjustment to Standard Deduction and Retirement Income Exemption
+      href: https://dam.ldr.la.gov/lawspolicies/RIB%2026-019.pdf#page=1
     - title: Consumer Price Index News Release - 2025 M12 Results
       href: https://www.bls.gov/news.release/archives/cpi_01132026.htm
     - title: 2025 Louisiana Resident Income Tax Return Instructions, Line 8
       href: https://dam.ldr.la.gov/taxforms/IT540i%20WEB(2025)D11.pdf#page=3
 
 SINGLE:
   2025-01-01: 12_500
-  # 2026 amount applies the December-to-December 2025 CPI-U increase:
-  # 12,500 * (324.054 / 315.605), rounded to the nearest dollar.
-  2026-01-01: 12_835
+  # RIB 26-019 applies a 2.7% CPI-U multiplier (BLS reported the December
+  # 2024 to December 2025 increase as 2.7%): 12,500 * 1.027 = 12,837.50,
+  # rounded to 12,838.
+  2026-01-01: 12_838
 SURVIVING_SPOUSE:
   2025-01-01: 25_000
-  2026-01-01: 25_670
+  2026-01-01: 25_676
 SEPARATE:
   2025-01-01: 12_500
-  2026-01-01: 12_835
-# The legal code defines the HoH and Joint amounts as 200% of the 
-# Single amount.
+  2026-01-01: 12_838
+# R.S. 47:294(A)(2) sets the head of household, joint and surviving spouse
+# amounts at 200% of the single amount; RIB 26-019 doubles the rounded
+# single amount (2 * 12,838 = 25,676, where 25,000 * 1.027 = 25,675).
 HEAD_OF_HOUSEHOLD:
   2025-01-01: 25_000
-  2026-01-01: 25_670
+  2026-01-01: 25_676
 JOINT:
   2025-01-01: 25_000
-  2026-01-01: 25_670
+  2026-01-01: 25_676

policyengine_us/parameters/gov/states/la/tax/income/exempt_income/retirement/cap.yaml

@@ -1,20 +1,28 @@
 description: Louisiana caps the retirement income exemption at this amount for filers, based on age.
 
 brackets:
-  - threshold: 
+  - threshold:
       2021-01-01: 0
-    amount: 
+    amount:
       2021-01-01: 0
   - threshold:
       2001-01-01: 65
     amount:
       2001-01-01: 6_000
       2025-01-01: 12_000
+      # RIB 26-019 applies a 2.7% CPI-U multiplier (BLS reported the December
+      # 2024 to December 2025 increase as 2.7%): 12,000 * 1.027 = 12,324.
+      # Later years follow R.S. 47:44.1(A)'s annual CPI-U adjustment,
+      # computed by extend_la_cpi_u_indexed_amounts in
+      # policyengine_us/parameters/uprating_extensions.py.
+      2026-01-01: 12_324
 
 metadata:
   reference:
     - title: Louisiana statutes, RS 47:44.1 - Annual retirement or disability income; exemption from taxation (A)
       href: https://www.legis.la.gov/legis/Law.aspx?d=102133
+    - title: Louisiana Department of Revenue, Revenue Information Bulletin 26-019 (September 28, 2026), Inflation Adjustment to Standard Deduction and Retirement Income Exemption
+      href: https://dam.ldr.la.gov/lawspolicies/RIB%2026-019.pdf#page=1
     - title: 2025 Louisiana Resident Income Tax Return Instructions, What's New - Code 6E
       href: https://dam.ldr.la.gov/taxforms/IT540i%20WEB(2025)D11.pdf#page=1
     - title: 2024 Louisiana Resident Income Tax Return
@@ -24,7 +32,7 @@ metadata:
     - title: 2022 Louisiana Resident Income Tax Return Instructions, Exemption Code 06E
       href: https://dam.ldr.la.gov/taxforms/IT540iWEB(2022)D1.pdf#page=6
   threshold_unit: year
-  amount_unit: currency-USD  
+  amount_unit: currency-USD
   type: single_amount
   period: year
   label: Louisiana retirement income exemption cap

policyengine_us/parameters/uprating_extensions.py

@@ -1,10 +1,11 @@
 """Unified script to extend all uprating factors through 2100."""
 
 import math
+from decimal import ROUND_HALF_UP, Decimal
 from typing import Optional, Tuple
 
 from policyengine_us.model_api import *
-from policyengine_core.periods import instant
+from policyengine_core.periods import Instant, instant
 
 
 LONG_RUN_CBO_INCOME_BY_SOURCE_PARAMETERS = (
@@ -202,6 +203,170 @@ def extend_or_ctc_parameters(parameters: ParameterNode, end_year: int) -> None:
         )
 
 
+def get_projected_cpi_u_for_month(cpi: Parameter, month: Instant) -> float:
+    """CPI-U for a month, interpolated toward CBO's projections if unobserved.
+
+    The model's CPI-U series holds BLS monthly observations, then CBO's
+    calendar-year averages as projection points at February instants (see
+    ``get_average_for_12_months_ending_august`` and #9608; the "# YYYY
+    value" comments in cpi_u.yaml label the tax year a point feeds, not its
+    calendar year). A calendar-year average sits halfway between June and
+    July of its year. So an unobserved month is interpolated geometrically,
+    by month, between the last observation and the next projection point
+    placed there, or between two such points; past the last point the index
+    holds flat.
+
+    As in ``get_average_for_12_months_ending_august``, only non-February
+    instants identify the end of the observed series, and no branch reads
+    an instant a refresh could have turned from projection into
+    observation: a February in the last observation's year is never an
+    anchor. That only matters when observations end in January (any later
+    month already follows that February): the February may then hold that
+    year's projection or an observation, so it is skipped, and the months
+    after January interpolate toward the next year's point.
+    """
+    last_observation = max(
+        instant(value.instant_str)
+        for value in cpi.values_list
+        if not value.instant_str.endswith("-02-01")
+    )
+    if month <= last_observation:
+        return cpi(month)
+
+    def month_index(date: Instant) -> float:
+        return 12 * date.year + date.month - 1
+
+    anchors = [(month_index(last_observation), cpi(last_observation))] + sorted(
+        (12 * int(value.instant_str[:4]) + 5.5, value.value)
+        for value in cpi.values_list
+        if value.instant_str.endswith("-02-01")
+        and int(value.instant_str[:4]) > last_observation.year
+    )
+    target = month_index(month)
+    for (start, start_level), (end, end_level) in zip(anchors, anchors[1:]):
+        if target <= end:
+            share = (target - start) / (end - start)
+            return start_level * (end_level / start_level) ** share
+    return anchors[-1][1]
+
+
+def get_la_cpi_u_percentage_increase(cpi: ParameterNode, year: int) -> float:
+    """The CPI-U percentage increase for calendar ``year``, as BLS reports it.
+
+    La. R.S. 47:294(B) and 47:44.1(A) multiply the prior year's amount by
+    "the percentage increase in the Consumer Price Index ... (CPI-U), as
+    reported by the United States Department of Labor, Bureau of Labor
+    Statistics ... for the previous calendar year". For tax year 2026, LDR
+    Revenue Information Bulletin 26-019 applied 2.7%. The bulletin names no
+    comparison months, but 2.7% is the December 2024 to December 2025 change
+    as BLS reported it (324.054 / 315.605, not seasonally adjusted: 2.677%).
+    The 2025 annual-average change (321.943 / 313.689) was 2.6%, and the
+    unrounded 2.677% would give $12,835 rather than the bulletin's $12,838.
+    So the percentage is the December-over-December change rounded to one
+    decimal place, as BLS reports it. A fall in the index is not an
+    increase, so the percentage is never negative.
+
+    ``cpi`` is the ``gov.bls.cpi`` node. BLS reports the change from the not
+    seasonally adjusted index, so the published Decembers in
+    ``cpi_u_nsa_december`` are used when both years have one. Otherwise
+    both Decembers come from the model's CPI-U series (seasonally adjusted
+    from January 2024), through ``get_projected_cpi_u_for_month``; mixing
+    the two would add December's seasonal factor (about 0.6% in 2025) to
+    the change.
+    """
+    december = cpi.cpi_u_nsa_december
+    published = {int(value.instant_str[:4]) for value in december.values_list}
+    if {year - 1, year} <= published:
+        current = december(f"{year}-12-01")
+        prior = december(f"{year - 1}-12-01")
+    else:
+        current = get_projected_cpi_u_for_month(cpi.cpi_u, instant(f"{year}-12-01"))
+        prior = get_projected_cpi_u_for_month(cpi.cpi_u, instant(f"{year - 1}-12-01"))
+    change = 100 * (Decimal(repr(current)) / Decimal(repr(prior)) - 1)
+    percentage = change.quantize(Decimal("0.1"), rounding=ROUND_HALF_UP)
+    return float(max(percentage, 0))
+
+
+def adjust_la_amount_for_inflation(prior_amount: float, percentage: float) -> float:
+    """Apply a La. R.S. 47:294(B) / 47:44.1(A) adjustment to a prior amount.
+
+    RIB 26-019's amounts are the adjusted amounts rounded to the nearest
+    dollar, with half dollars rounding up: $12,500 x 1.027 = $12,837.50
+    became $12,838. The arithmetic is decimal because in binary floating
+    point 12,500 x 1.027 is just below 12,837.5 and would round down.
+    """
+    adjusted = Decimal(str(prior_amount)) * (100 + Decimal(str(percentage))) / 100
+    return float(adjusted.quantize(Decimal(1), rounding=ROUND_HALF_UP))
+
+
+def extend_la_cpi_u_indexed_amounts(parameters: ParameterNode, end_year: int) -> None:
+    """Project Louisiana's CPI-U-indexed standard deduction and retirement cap.
+
+    Each year after the last LDR-published amount, the single and
+    married-separate standard deduction (R.S. 47:294(A)(1)) and the age-65
+    retirement income exemption (R.S. 47:44.1(A)) become the prior year's
+    amount adjusted by the prior calendar year's CPI-U percentage increase
+    (see ``get_la_cpi_u_percentage_increase``), rounded to the nearest
+    dollar. The joint, head of household and surviving spouse deduction is
+    200% of the single amount (R.S. 47:294(A)(2)), so it doubles the rounded
+    single amount rather than being adjusted on its own. Amounts encoded in
+    the YAML take precedence for their own years.
+
+    Like the other projections in this module, the values are fixed when
+    the parameter tree is built. A reform that changes the single amount
+    does not carry through to the other filing statuses or later years.
+    """
+    la = parameters.gov.states.la.tax.income
+    cpi = parameters.gov.bls.cpi
+    standard = la.deductions.standard.amount
+    retirement_caps = [
+        bracket.amount
+        for bracket in la.exempt_income.retirement.cap.brackets
+        if bracket.threshold(f"{end_year}-01-01") == 65
+    ]
+    if len(retirement_caps) != 1:
+        raise ValueError(
+            "Expected one age-65 bracket in the Louisiana retirement income "
+            f"exemption cap; found {len(retirement_caps)}."
+        )
+    percentages = {}
+    for parameter in (standard.SINGLE, retirement_caps[0]):
+        first_projected_year = 1 + max(
+            int(value.instant_str[:4]) for value in parameter.values_list
+        )
+        for year in range(first_projected_year, end_year + 1):
+            if year - 1 not in percentages:
+                percentages[year - 1] = get_la_cpi_u_percentage_increase(cpi, year - 1)
+            parameter.update(
+                period=f"year:{year}-01-01:1",
+                value=adjust_la_amount_for_inflation(
+                    parameter(f"{year - 1}-01-01"), percentages[year - 1]
+                ),
+            )
+        parameter.update(
+            start=instant(f"{end_year}-01-01"),
+            value=parameter(f"{end_year}-01-01"),
+        )
+    for parameter, share_of_single in (
+        (standard.SEPARATE, 1),
+        (standard.JOINT, 2),
+        (standard.HEAD_OF_HOUSEHOLD, 2),
+        (standard.SURVIVING_SPOUSE, 2),
+    ):
+        first_projected_year = 1 + max(
+            int(value.instant_str[:4]) for value in parameter.values_list
+        )
+        for year in range(first_projected_year, end_year + 1):
+            parameter.update(
+                period=f"year:{year}-01-01:1",
+                value=share_of_single * standard.SINGLE(f"{year}-01-01"),
+            )
+        parameter.update(
+            start=instant(f"{end_year}-01-01"),
+            value=parameter(f"{end_year}-01-01"),
+        )
+
+
 def extend_wa_millionaires_standard_deduction(
     parameters: ParameterNode,
     end_year: int,
@@ -633,6 +798,12 @@ def set_all_uprating_parameters(parameters: ParameterNode) -> ParameterNode:
     # above so projected windows are available.
     extend_or_ctc_parameters(parameters, end_year=END_YEAR)
 
+    # Louisiana's standard deduction and age-65 retirement income exemption
+    # follow R.S. 47:294(B) and 47:44.1(A): the prior year's amount times the
+    # prior calendar year's CPI-U increase. Must run after the CPI-U extension
+    # above so projected Decembers are available.
+    extend_la_cpi_u_indexed_amounts(parameters, end_year=END_YEAR)
+
     # The limits on a dependent's standard deduction follow 26 U.S.C.
     # 63(c)(4)'s chained CPI-U schedule, computed from the statutory 1987 and
     # 1997 bases. Must run after the Chained CPI-U extension above so

policyengine_us/tests/policy/baseline/gov/states/la/tax/income/deductions/la_standard_deduction.yaml

@@ -14,18 +14,42 @@
   output:
     la_standard_deduction: 25_000
 
-- name: 2026 single filer uses prior-calendar-year CPI-U adjustment
+- name: 2026 single filer gets the RIB 26-019 amount, 12,500 x 1.027 rounded
   period: 2026
   input:
     state_code: LA
     filing_status: SINGLE
   output:
-    la_standard_deduction: 12_835
+    la_standard_deduction: 12_838
 
-- name: 2026 head of household filer gets twice the single amount
+- name: 2026 married filing separately filer gets the single amount
+  period: 2026
+  input:
+    state_code: LA
+    filing_status: SEPARATE
+  output:
+    la_standard_deduction: 12_838
+
+- name: 2026 head of household filer gets twice the rounded single amount
   period: 2026
   input:
     state_code: LA
     filing_status: HEAD_OF_HOUSEHOLD
   output:
-    la_standard_deduction: 25_670
+    la_standard_deduction: 25_676
+
+- name: 2026 joint filer gets twice the rounded single amount, not 25,000 x 1.027
+  period: 2026
+  input:
+    state_code: LA
+    filing_status: JOINT
+  output:
+    la_standard_deduction: 25_676
+
+- name: 2026 surviving spouse gets twice the rounded single amount
+  period: 2026
+  input:
+    state_code: LA
+    filing_status: SURVIVING_SPOUSE
+  output:
+    la_standard_deduction: 25_676