Maritime Payroll in Houma: Jones Act, Crew Taxes, and What Most CPAs Miss

Houma is not just a maritime town. It is the operational heart of the Gulf of Mexico’s offshore energy industry. Port Fourchon, just south of Houma, services over 90% of deepwater energy production in the Gulf. Thousands of crew members, tugboat operators, supply vessel personnel, and offshore workers live and work in the Houma-Thibodaux metro area.

For the businesses that employ them, payroll is not a generic function. Maritime payroll involves a unique set of federal rules that most CPAs never encounter — and that some Houma employers discover only after a tax notice arrives.

This guide covers the payroll issues that Houma maritime employers face and the rules that most CPAs miss.

Who counts as a Jones Act seaman?

The Jones Act (46 U.S.C. § 30104) gives seamen the right to sue their employer for personal injury or death. A worker qualifies as a seaman if they spend 30% or more of their work time in service of a vessel and their duties contribute to the vessel’s function or mission.

For Houma employers, this covers a wide range of workers:

• Crew members on supply vessels, tugboats, and crew boats
• Offshore workers who live and work on vessels for extended periods
• Marine construction and fabrication workers assigned to vessels
• Dredge operators and pipeline personnel working from vessels

The seaman classification matters for payroll because it determines which tax rules apply. A worker who qualifies as a Jones Act seaman is subject to different withholding and payroll tax treatment than a land-based employee.

What most CPAs miss: Louisiana cannot mandate state tax withholding for seamen

This is the rule that catches Houma employers and their CPAs off guard.

46 U.S.C. § 11108 prohibits the mandatory withholding of state and local income taxes from the wages of a master or seaman on a vessel engaged in the foreign or coastwise trade. Louisiana cannot require an employer to withhold Louisiana state income tax from seamen’s wages.

The practical effect for Houma employers:

Federal income tax and FICA are still withheld. The prohibition applies only to state and local taxes.

Voluntary withholding agreements are permitted. If an employee wants Louisiana income tax withheld from their wages, the employer and employee can enter into a voluntary agreement. But the withholding cannot be mandatory.

Most payroll software is not configured for this. It will apply Louisiana state tax withholding automatically unless the employer overrides it. A Houma CPA who knows the rule ensures that seamen’s wages are processed correctly and that voluntary agreements are documented.

The aquaculture exemption: a narrow carve-out

Congress amended 46 U.S.C. § 30104 in 2022 through the Shellfish Aquaculture Improvement Act (Public Law 117-263). The amendment excludes aquaculture workers from the definition of “seaman” if state workers’ compensation is available to them.

An aquaculture worker is defined as an individual who:

• Is employed by a commercial enterprise involved in the controlled cultivation and harvest of aquatic plants and animals, including shellfish cultivation and the cleaning, processing, or canning of fish products
• Does not hold a license under section 7101(c)
• Is not required to hold a merchant mariner credential

For Houma employers in aquaculture, this means workers are covered by Louisiana workers’ compensation rather than the Jones Act. Employers no longer need Jones Act insurance for these workers, but they must pay into the Louisiana workers’ compensation system.

The exemption does not apply to licensed captains or workers required to hold merchant mariner credentials. Those workers remain seamen under the Jones Act.

Property tax reimbursements on leased maritime equipment

Houma maritime businesses often lease equipment — cranes, generators, pumps, and specialty vessels. Under Louisiana Revenue Ruling No. 04-006, when a lessor pays property tax on the leased asset and collects a lump-sum reimbursement from the lessee, that reimbursement is subject to Louisiana sales tax.

The ruling is clear: the amount a lessor charges for reimbursement of property taxes is part of the “gross proceeds” from the lease. It is taxable the same as the lease payments themselves.

For Houma businesses that lease heavy equipment, this means:

• The lease payment is taxable
• The property tax reimbursement added to the invoice is also taxable
• Sales tax must be charged on the full invoiced amount

Most CPAs treat property tax reimbursements as a pass-through and do not charge sales tax on them. That is incorrect in Louisiana.

Crew payroll: what is different from land-based payroll

Maritime payroll differs from land-based payroll in several key ways:

Voyage-based pay. Crew members are often paid by the voyage or by the day, not by the hour. Overtime rules under the Fair Labor Standards Act do not apply to seamen. Instead, seamen are covered by the Seaman’s Wage Act, which has its own rules for wage payment and overtime.

Shipping articles. Under 46 U.S.C. § 10302, crew members on vessels of 100 gross tons or more must sign shipping articles — a written employment agreement that specifies the voyage, wages, and terms of employment. The payroll system must track voyage dates and calculate wages earned in each period.

Multi-state apportionment. Crew members who work in multiple states may have income tax obligations in each state. For Louisiana seamen, the state withholding prohibition under 46 U.S.C. § 11108 means Louisiana income tax is not withheld, but the worker may still owe Louisiana income tax when they file their return.

Per diem and subsistence. Many maritime employers pay a per diem for meals and lodging. The tax treatment depends on whether the per diem is paid under an accountable plan and whether it exceeds the federal per diem rate.

Why a Houma-specific CPA matters

A generalist CPA may know Louisiana tax law. A CPA with Houma maritime experience knows:

• The 30% test for Jones Act seaman status and how it applies to offshore workers
• The prohibition on mandatory Louisiana withholding under 46 U.S.C. § 11108
• How to document voluntary withholding agreements
• The aquaculture exemption and when it applies
• Revenue Ruling 04-006 and the sales tax treatment of property tax reimbursements
• Crew payroll rules under the Seaman’s Wage Act and shipping articles

The cost of a Houma maritime CPA is small relative to the cost of a payroll audit, back taxes, and penalties.

The bottom line

Maritime payroll in Houma is not a generalist discipline. The Jones Act seaman classification, the state withholding prohibition, the aquaculture exemption, and the sales tax treatment of lease reimbursements all require specialized knowledge.

If your Houma maritime business employs crew, leases equipment, or operates vessels in the Gulf, work with a CPA who understands the industry. The rules are not intuitive, and the penalties for getting them wrong are not small.

Louisiana CPA Hub is an independent referral service. It is not an accounting firm and does not provide tax, accounting, legal or financial advice.