316 Neb. Admin. Code, ch. 23, § 008

Current through September 17, 2024

Section 316-23-008 - CREDITS AGAINST THE NEBRASKA TAX

008.01 Credit for tax paid to another state

Only resident estates or trusts can claim credit for income tax paid to another state, political subdivision of another state, or the District of Columbia.

008.01A The maximum credit allowed for taxes paid to another state is the lesser of the computed tax credit or the actual tax paid, not to exceed the Nebraska income tax. The computed tax credit is calculated by dividing the taxable income from the other state by the Nebraska adjusted federal taxable income of the fiduciary, and multiplying the quotient by the Nebraska income tax.

008.01B The only acceptable supporting document for the credit claimed for income tax paid to another state is a signed copy of the income tax return filed with the state for which the credit is claimed. If the estate or trust is claiming credit for income tax paid to a political subdivision of another state in which no annual income tax return is required, then a W-2 statement supporting the credit claim should be attached to the return.

008.02 Nonhighway use motor fuel credit

For tax years ending before January 1, 2005, an estate or trust may claim a refundable credit for nonhighway use motor fuel pursuant to the provisions of Reg-84-001 through Reg-84-006. For tax years ending after December 31, 2004, estates and trusts may obtain a direct refund of the fuels tax paid by filing a refund claim with the Department of Revenue's Motor Fuels Division.

008.03 Community Development Assistance Act (CDAA) Credit

A nonrefundable credit may be claimed by a fiduciary for an estate which operates a business firm with contributions to approved projects of community betterment organizations under Chapter 13 of the Nebraska Revised Statutes .

008.03A The credit is allowed where a business firm has applied to the Department of Economic Development (DED) for authorization for a tax credit for a contribution to a certified program of a community betterment organization. DED may authorize a tax credit not to exceed forty percent of the total amount contributed by the business during its taxable year.

008.03A(1) The contribution by the business must qualify as a charitable contribution under the Internal Revenue Code.

008.03A(2) A taxpayer claiming a CDAA credit must attach to its fiduciary income tax return a copy of the Statement of Nebraska Tax Credit, Form 1099NTC, received from DED that includes the amount of the credit granted by DED for the contribution made to the community betterment organization.

008.03A(3) Any tax credit may be carried over to the next five tax years immediately following the tax year in which the credit was first allowed.

008.04 Nebraska Advantage Rural Development Act Credit

Fiduciaries may claim a refundable credit if their business has a signed agreement with the Department of Revenue and qualifies for such credit. Applications will be accepted for this credit on and after January 1, 2006. Taxpayers who submitted applications before January 1, 2006 under the Employment Expansion and Investment Incentive Act will receive any applicable credits under that Act.

008.04A A taxpayer creating less than seventy-five percent of the jobs in the project agreement must repay one hundred percent of the job creation credits. In addition, a taxpayer creating less than seventy-five percent of the investment in the project agreement must repay one hundred percent of the investment tax credits.

008.05 Employment and Investment Growth Act Credit

Fiduciaries may claim a nonrefundable credit if their business has a signed agreement with the Department of Revenue and qualifies for such credit. Applications under this Act will be accepted through December 31, 2005. Agreements pending, approved, or entered into before January 1, 2006 will remain in full force and effect.

008.05A Any income tax credit may be recaptured if the taxpayer fails to meet the required levels of employment or investment.

008.06 Wage Benefit Credit

Fiduciaries may claim a nonrefundable credit for any wage benefit credit to which they are entitled under the Quality Jobs Act.

008.07 Income tax withholding

Fiduciaries may claim a refundable credit for withholding.

008.08 Nebraska Advantage Act Credit

Fiduciaries may claim a nonrefundable credit if their business has a signed agreement with the Department of Revenue and qualifies for such credit. Applications will be accepted beginning January 1, 2006. Taxpayers who fail to meet the terms of the agreement shall be subject to recapture or disallowance of the Nebraska Advantage Act incentives.

008.09 Nebraska Advantage Microenterprise Tax Credit Act

Fiduciaries which are actively engaged in the creation or operation of a microbusiness in a distressed area may claim a refundable credit if their business has a signed agreement with the Department of Revenue and qualifies for such credit. Applications may be filed under this Act beginning January 1, 2006. Tax credits will not be allowed for taxpayers receiving benefits under the Employment and Investment Growth Act, the Nebraska Advantage Act, or the Nebraska Advantage Rural Development Act.

008.10 Nebraska Advantage Research and Development Act Credit

Fiduciaries operating a business which is subject to Nebraska sales tax may claim a refundable credit for expenditures in research and experimental activities defined in section 174 of the Internal Revenue Code. Fiduciaries which are exempt from income tax under section 501(a) of the Internal Revenue Code do not qualify for this credit.

008.10A The credit may be claimed for a maximum of five consecutive tax years. The fiduciary may make its first claim for tax years beginning on and after January 1, 2006 through tax years beginning prior to January 1, 2011. The credit may also be claimed in the four tax years immediately following the year in which the credit was first claimed.

008.11 Planned Gift and Contribution Credit

For tax years beginning on or after January 1, 2006, fiduciaries may claim a nonrefundable credit for planned gifts and contributions to qualified endowments. The credit cannot include any contribution claimed as a deduction on the state tax return. The credit may only be applied to the tax year in which the contribution is made.

008.12 Beginning Farmer Tax Credit Act

A resident trust may claim a refundable credit on the Nebraska Fiduciary Income Tax Return, if it qualifies for such credit.

316 Neb. Admin. Code, ch. 23, § 008

Section 77-2725, and 77-2730, R.R.S. 2003, sections 66-4,124, and 66-726, R.S.Supp., 2004, and sections 77-2715.07, 77-2717, 77-27,188, 77-27,233, and 77-5726, R.S.Supp., 2005. March 7, 2006.