Summary of General Provisions of Nebraska Tax Incentive Programs Under LB 312

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Qualifications
  
Nebraska Advantage Rural Development Act
Nebraska Advantage Act
Provision
Level 1
Level 2
Livestock Modernization
SUPER Advantage
(Tier 6)
Tier 1
Tier 2
Tier 3
Tier 4
Tier 5
Begins
01-01-2006
01-01-2004
01-01-2007
04-18-2008
01-01-2006
Ends
12-31-2019
12-31-2017
Application
Required
Required
Application Fee
$500
$10,000
$1,000
$2,500
$5,000
$2,500
Nebraska Location
One county of less than 15,000 inhabitants or one designated enterprise zone
One county of less than 25,000 inhabitants or one designated enterprise zone
Anywhere
Anywhere
Required Levels
 
Nebraska Advantage Rural Development Act
Nebraska Advantage Act
Provision
Level 1
Level 2
Livestock Modernization
SUPER Advantage
(Tier 6)
Tier 1
Tier 2
Tier 3
Tier 4
Tier 5
Investment
net gain of $125,000
net gain of $250,000
net gain of $50,000
$10M[vi]
$10M (2009)
$10M (2010)
$10M (2011)
$10M (2012)
$10M (2013)
$11M (2014)
$11M (2015)
$10M (2016)
$100M[vi]
$102M (2009)
$100M (2010)
$100M (2011)
$106M (2012)
$109M (2013)
$110M (2014)
$111M (2015)
$106M (2016)
$1,000,000[v]
$3,000,000[v]
N/A

$10 million[vi] (2008)
  $11 million (2009)
 $10 million (2010)
$11 million (2011)
  $12 million (2012-2016)

$31 million (2008)
$34 million (2009)
$32 million (2010)
$33 million (2011)
$36 million (2012)
$37 million (2013-2015)
$36 million (2016)

Employment
2
5
none
75
50
10
30
100
no loss
Wage Level
$  8.57 (2005)
$  8.93 (2006)
$  9.25 (2007)
 $  9.72 (2008)
$10.28 (2009)
$10.73 (2010)
$10.86 (2011)
$11.13 (2012)
$11.56 (2013)
$11.96 (2014)
$12.33 (2015)
$12.86 (2016)
N/A

Higher of 200% of county average and 150% of state average weekly wage

Required Annual Wages by County

60% [i] ($18,905 for 2006)
            ($19,452 for 2007)
            ($20,281 for 2008)
            ($21,136 for 2009)
             ($21,742 for 2010)
            ($21,986 for 2011)
             ($22,394 for 2012)
            ($22,961 for 2013)
            ($23,561 for 2014)
            ($23,979 for 2015)
            ($24,711 for 2016)
Indexing [vii]
Wage level
N/A
Wage and investment levels
Attainment Period
Up to 2 tax years
Up to 5 tax years
Up to 7 tax years
Up to 5 tax years
Up to 7 tax years
Entitlement Period
2 tax years
10 years
6 or 7 tax years
7 tax years
6 or 7 tax years
7 tax years
Carryover Period
N/A
1 year
0 to 3 tax years
2 to 8 tax years
0 to 3 tax years
2 to 8 tax years
N/A
Maintenance Period
3 tax years after credits earned
N/A
Entitlement period
Eligible Participant
3 tax years after credits earned.
Person subject to income tax or financial institutions tax. A partnership, limited liability company, corporation, S corporation, joint venture, or cooperative.
Person who is or whose owners are subject to sales and use tax and withholding tax or is exempt under section 521 of IRC.
Business Activities
 
Nebraska Advantage Rural Development Act
Nebraska Advantage Act
Provision
Level 1
Level 2
Livestock Modernization
SUPER Advantage
(Tier 6)
Tier 1
Tier 2
Tier 3
Tier 4
Tier 5
Research & Development
Qualified
Non-qualified
Qualified
Manufacturing of Tangible Personal Property (TPP)
Qualified
Non-qualified
Qualified
Software Development, Computer Design [ii]
N/A
Non-qualified
Qualified
Data Processing
Qualified
Non-qualified
Qualified
Non-qualified
Qualified
Telecommunications
Qualified
Non-qualified
Qualified
Non-qualified
Qualified
Insurance Services
Qualified
Non-qualified
Qualified
Non-qualified
Qualified
Financial Services
Qualified
Non-qualified
Qualified
Non-qualified
Qualified
Warehousing, Distribution of TPP
Qualified
Non-qualified
Qualified
Non-qualified
Qualified
Transportation of TPP
Qualified
Non-qualified
Qualified
Non-qualified
Qualified
Retail Sales of TPP if more than 20% is: [iii]
Qualified
Non-qualified
Qualified
Non-qualified
Qualified
Retail Sales of TPP if more than 75% is delivered to purchasers in another state
Non-qualified
Non-qualified
Qualified
Non-qualified
Qualified
Administrative Management
Of any taxpayer activity
Non-qualified
Qualified
Non-qualified
Of any activiity of taxpayer or entities with 10% common ownership.
Ranching & Livestock Operation
Qualified
Qualified
Non-qualified
Farming Operation
Non-qualified
Qualified
Non-qualified
Restaurants
Non-qualified
Non-qualified
Contractor & Repair Person
Non-qualified
Qualified
Non-qualified
Most Retailers Except those Stated Above
Non-qualified
Non-qualified
All Other Activities
Non-qualified
Qualified
Non-qualified
Benefits
 
Nebraska Advantage Rural Development Act
Nebraska Advantage Act
Provision
Level 1
Level 2
Livestock Modernization
SUPER Advantage
(Tier 6)
Tier 1
Tier 2
Tier 3
Tier 4
Tier 5
Direct Refund of Sales Tax on Qualified Property or an Aircraft
N/A
Property placed in service in attainment and entitlement periods.
50% of tax on property placed in service in attainment and entitlement periods.
Property placed in service in attainment and entitlement periods.
N/A
Property placed in service in attainment and entitlement periods.
Investment Credit on Qualified Property
$2,750 investment credit earned for each $50,000 net gain in qualified property available for use.
10% of investment, limit of $30,000
15% investment credit earned from date of application through end of the entitlement period.
3% investment credit earned from date of application through end of the entitlement period.
10% investment credit earned from date of application through end of the entitlement period.
N/A
10% investment credit earned from date of application through end of the entitlement period.
N/A
Credit on Employment Growth
$3,000 employment credit earned for each new full time equivalent Nebraska employee.
N/A
10% of taxable wage of all non-base year employees.
Compensation credit equal to percentage of taxable wages of new employee.
N/A
Personal Property Tax Exemption [iv]
N/A
Aircraft from year after application. All other personal property at project after reaching the required levels. Through ninth December 31 after the year of qualification.
N/A
Aircraft from year after application. Other after reaching the required levels. Through ninth December 31 after the year of qualification.
N/A
Use of Credits
 
Nebraska Advantage Rural Development Act
Nebraska Advantage Act
Provision
Level 1
Level 2
Livestock Modernization
SUPER Advantage
(Tier 6)
Tier 1
Tier 2
Tier 3
Tier 4
Tier 5
Retain Withholding
N/A
Limited to the amount of compensation credit or withholding attributable to new employees.
N/A
Credit Refund of Sales and Use Taxes Paid on Purchases
Refund of state sales and use taxes. Up to the amount paid on increased investment in the year the credits are earned.
In Nebraska, during the entitlement and carryover period and to the extent of credits earned in a prior year.
At the project, during the entitlement and carryover period and to the extent of credits earned in a prior year.
N/A
Credit to Reduce Income Tax Liability
Refundable credit by a taxpayer filing a NE income tax return.
Credits may be used after other non-refundable credits to pay up to 100% of NE unitary tax liability.
N/A
Distribution of Credits to Owner of Flow-through Entity Credits may be distributed in the same manner as income and used to pay up to 100% of NE income tax liability. Credits may be distributed in the same manner as income and used to pay up to 100% of NE income tax liability.
N/A
Credit Refund of Real Property Taxes
N/A
At the project, real property acquired or built during the entitlement period to the extent of credits earned in a prior year. Not allowed if property subject to tax increment financing.
N/A
Qualified Property is Tangible, Depreciable Property
Except for motor vehicles,aircraft, or railroad rolling stock, and property rented to another party.
Except for aircraft, barges, motor vehicles, railroad rolling stock, watercraft, and property rented to another party.
N/A
Except for aircraft, barges, motor vehicles, railroad rolling stock, watercraft, and property rented to another party.
Owned Property
Valued at original cost.
Valued at original cost.
N/A
Valued at original cost.
Rented, Qualified Property
Average net annual rent multiplied by a number of years, not to exceed 10 years.
Average net annual rent multiplied by a number of years, not to exceed 10 years.
N/A
Average net annual rent multiplied by a number of years, not to exceed 10 years.
Reports by Project
01-01-2006
01-01-2007
04-18-2008
01-01-2006
i --The wages paid must be at least 60% of the state average wage for the application year.
ii-- Software development, computer design, product testing, guidance and surveillance system design, or licensing of technology if 75% of sales are to persons outside the state of Nebraska or to the United States government.
iii-- Retail sale of TPP if more than 20% is: at wholesale; manufactured by seller; or sold to others in a qualified activity.
iv-- Personal property tax exemption on turbine-powered aircraft, mainframe business computers and some peripherals, and equipment involved directly in processing an agricultural product or for LB 312, distribution center equipment used to store or move products.
v-- The investment levels have been indexed and remain the same through 2016.
vi-- The investment levels have been indexed and remain the same through 2008.
vii-- Further indexing does not apply after application filed.


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