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Incentive credits earned under the Enterprise Zone Act were based on the provisions of the Employment Expansion and Investment Incentive Act. The Enterprise Zone Act provided a higher employment credit for companies engaged in a qualifying business within the defined enterprise zones and employing residents of the zone. If at least 50 percent of the new employees resided within the enterprise zone, then the taxpayer also received additional credits for new investment. Click here for more detailed information.
The credits provided under this subsection were not to exceed $75,000 in any one tax year. In addition to the requirements to maintain the employment and investment levels for two years, taxpayers earning credits under the Enterprise Zone Act for tax years starting before January 1, 2001 must have maintained the number of new employees residing in the enterprise zone.
The Nebraska Employment and Investment Credit Computation, Form 3800N, filed with a tax return is the method to report credits earned, investment made, jobs created for employees in total, and for residents of the zone.
A taxpayer who earned credits in tax years before 2004 may use these credits during the five year carryover period. The taxpayer must file to show maintenance of the required investment and employment levels for two years.
If a taxpayer failed to maintain the required levels of investment and employment for at least two years after the year for which the credit was first allowed, part of the used and unused credits are subject to recapture. During the subsequent two years, the taxpayer must repay the state one-third of the amount of the credit subject to recapture for each year that the taxpayer did not maintain the required levels.
In 2010, taxpayers within the enterprise zones did not report any activity.