Section 316-35-407 - LOTTERY AND RAFFLE TAXES407.01 A nonprofit organization conducting a lottery with gross proceeds in excess of $1,000.00, or a raffle with gross proceeds in excess of $5,000.00, is required to remit to the Department, a tax of two per cent of the gross proceeds of such lottery or raffle.407.02 A licensed organization is required to report within thirty (30) days of the end of each calendar quarter, its gross proceeds and tax due on a form prescribed by the Department and to remit any tax due for that quarter, even though the gross proceeds for a particular quarter do not exceed the $1,000.00 or $5,000.00 threshold. If the total gross proceeds derived from the sale of lottery or raffle tickets does not exceed the $1,000.00 or $5,000.00 threshold at the conclusion of the lottery or raffle activity, the taxes paid on the gross proceeds are refundable. The licensed organization should submit an amended return to the Department requesting a refund or credit of the lottery or raffle taxes paid to the Department. 407.02A The lottery and raffle tax is to be reported on the Nebraska Lottery and Raffle Tax Return, Form 51.407.03 Failure to file a quarterly tax return or remit the tax due by the due date will subject the licensed organization to assessment of a penalty of $ 25.00 or ten percent of the tax due, whichever is greater. In addition, interest will be imposed at the rate specified in section 45-104.02 of the Nebraska Revised Statutes, as amended, from the due date to the date paid. 407.03(A) Quarterly returns filed after the due date which indicate a zero amount of proceeds and/or a zero balance of tax due, shall not be subject to the penalty as previously described.407.04 If the due date for filing the quarterly tax return falls on a Saturday, Sunday, or a day considered a holiday by the state, the return will be considered to be timely filed if it is postmarked no later than twelve o'clock midnight of the next working day following the due date. Postmarks not made by the United States post office will not be recognized for purposes of this regulation.407.05 A licensed organization is not required to charge, collect or remit sales tax on the purchase price of a lottery or raffle ticket unless such ticket is connected in part with the purchase of some other tangible personal property or an admission charge which is subject to such tax. Examples of tangible personal property which may be connected to the purchase of a lottery or raffle ticket are items such as a calendar or a dinner.407.06 Nebraska withholding tax is required on payments of lottery or raffle winnings which are subject to federal withholding and that are paid from a Nebraska source to a resident or nonresident individual. 407.06A On or before February 15 following the close of each calendar year, a payor of such gambling winnings must furnish to each winner for state purposes two copies of a completed and legible Statement for Recipients of Certain Gambling Winnings, Federal Form W-2G, or a federally approved substitute. One of the copies must be labeled "state copy", to be submitted with the winner's Nebraska income tax return, and one copy must be labeled "winner's copy", for the winner's records.407.06B On or before March 15 following the close of each calendar year, the payor must file with the Nebraska Department of Revenue a Nebraska Reconciliation of Income Tax Withheld, Form W-3N, in accordance with the instructions contained in Withholding Tax Regulation 21-013. A copy of the Federal Form W-2G furnished to each winner which shows the Nebraska tax withheld from winnings during the prior calendar year must be submitted with the Form W-3N. Those payors of gambling winnings who are also required to withhold state income tax on behalf of employees may file only one Form W-3N to transmit state copies of both Form W-2 and Form W-2G. 316 Neb. Admin. Code, 35, § 407