Nebraska State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in Nebraska, with full citations and the original source on every page.
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How does a Nebraska individual recompute the 2000 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 22-00-1, Neb. Rev. Stat. §77-2715 requires a Nebraska individual to recalculate the 2000 federal alternative minimum tax (Federal Form…
Can a Nebraska nonprofit run a 'duck race' lottery or raffle, and when does it need a license and permit?
Yes, with conditions. Under LB 248 (effective June 6, 1997) and LB 1086 (effective July 13, 2000), a Nebraska nonprofit may conduct a lottery or raffle that uses a race of inanimate buoyant objects (a…
Can a Nebraska nonprofit sell 'bingo bonus' pickle cards whose winners are decided by a bingo-ball draw, and what rules apply?
Yes, if the organization holds both licenses. Under LB 658, effective July 13, 2000, a Nebraska organization holding a Class I or Class II bingo license that also holds a Class I or Class II lottery-b…
Which year's labor statistics set the required employment, investment, and wage levels for Rural Economic Opportunity Act incentive applications filed in 2000?
Applications filed in calendar year 2000 use calendar-year 1997 labor statistics -- the most recent year for which all required, non-preliminary figures had been reported as of July 1, 1999 (some 1998…
Are a Nebraska city, county, or joint airport authority's purchases exempt from sales and use tax?
Mostly exempt, starting October 1, 2000. Under Laws 2000, LB 557, purchases by a Nebraska city, county, or joint airport authority are exempt from sales and use tax, except purchases for use in the bu…
How does a Nebraska estate or trust figure the 1999 credit for prior year minimum tax on the Nebraska return?
Recompute the federal credit for Nebraska. Under Revenue Ruling 23-99-2, Neb. Rev. Stat. §77-2717 requires an estate or trust to recalculate the federal credit for prior year minimum tax (Federal Form…
How does a Nebraska individual figure the 1999 credit for prior year minimum tax on the Nebraska return?
Recompute the federal credit for Nebraska. Under Revenue Ruling 22-99-2, Neb. Rev. Stat. §77-2715(2) requires an individual to recalculate the federal credit for prior year minimum tax (Federal Form 8…
How does a Nebraska estate or trust recompute the 1999 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 23-99-1, Neb. Rev. Stat. §77-2717 requires estates and trusts to recalculate the 1999 federal alternative minimum tax (Federal Form 10…
How does a Nebraska individual recompute the 1999 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 22-99-1, Neb. Rev. Stat. §77-2715 requires an individual to recalculate the 1999 federal alternative minimum tax (Federal Form 6251, o…
Is mobility enhancing equipment installed on a motor vehicle — hand controls, van lifts — exempt from Nebraska sales tax?
Yes, with a prescription. Under Revenue Ruling 01-99-5 and Neb. Rev. Stat. §77-2704.09, mobility enhancing equipment installed on a motor vehicle to make it suitable for a disabled or handicapped pers…
Is mobility enhancing equipment for a Nebraska home — ramps, stair lifts, elevators — exempt from sales tax?
Yes, with a prescription and a Form 13. Under Revenue Ruling 01-99-4 and Neb. Rev. Stat. §77-2704.09, mobility enhancing equipment for use in a private residence — items like ramps, railings, stair li…
Are a Nebraska Natural Resource District's purchases exempt from sales and use tax?
Yes, starting October 1, 1999. Under Laws 1999, LB 232, purchases by a Nebraska Natural Resource District are exempt from sales and use taxes. To buy tax-free on and after October 1, 1999, the Distric…
Does a Nebraska retailer owe use tax on discounted cell phones given out to land service contracts?
The retailer owes consumer's use tax on the shortfall. Under Revenue Ruling 01-99-2, which supersedes Revenue Ruling 1-98-1, a retailer who furnishes cellular telephones at a substantially reduced pri…
Is the Nebraska Universal Service Fund (NUSF) surcharge on a phone bill subject to Nebraska sales tax?
No — the NUSF surcharge is not subject to sales tax. Under Revenue Ruling 01-99-1, the Nebraska Universal Service Fund (NUSF) surcharge assessed against certain retail, end-user telecommunications rev…
How does a Nebraska estate or trust figure the 1998 credit for prior year minimum tax on the Nebraska return?
Recompute the federal credit for Nebraska. Under Revenue Ruling 23-98-2, Neb. Rev. Stat. §77-2717 requires an estate or trust to recalculate the federal credit for prior year minimum tax (Federal Form…
How does a Nebraska individual figure the 1998 credit for prior year minimum tax on the Nebraska return?
Recompute the federal credit for Nebraska. Under Revenue Ruling 22-98-2, Neb. Rev. Stat. §77-2715(2) requires an individual to recalculate the federal credit for prior year minimum tax (Federal Form 8…
Which Nebraska sales and use tax revenue rulings did the Department list as no longer valid in Revenue Ruling 01-98-3?
This is a status list, not a new rule. Revenue Ruling 1-98-3 (Sales and Use Tax), issued December 17, 1998, is a housekeeping ruling in which the Nebraska Department of Revenue lists the older Sales a…
Which Nebraska sales and use tax revenue rulings did the Department list as still valid in Revenue Ruling 01-98-2?
This is a status list, not a new rule. Revenue Ruling 1-98-2 (Sales and Use Tax), issued December 17, 1998, is a housekeeping ruling in which the Nebraska Department of Revenue lists the older Sales a…
How does a Nebraska estate or trust recompute the 1998 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 23-98-1, Neb. Rev. Stat. §77-2717 requires estates and trusts to recalculate the 1998 federal alternative minimum tax (Federal Form 10…
How does a Nebraska individual recompute the 1998 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 22-98-1, Neb. Rev. Stat. §77-2715 requires an individual to recalculate the 1998 federal alternative minimum tax (Federal Form 6251, o…
How does a Nebraska estate or trust recompute the 1997 federal credit for prior year minimum tax to claim the Nebraska credit?
Recompute the federal credit on Nebraska terms, then take 29.6% of it. Under Revenue Ruling 23-97-2, Neb. Rev. Stat. §77-2717 requires an estate or trust to recompute the 1997 federal credit for prior…
How does a Nebraska estate or trust recompute the 1997 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 23-97-1, Neb. Rev. Stat. §77-2717 requires estates and trusts to recalculate the 1997 federal alternative minimum tax (Federal Form 10…
How does a Nebraska individual recompute the 1997 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 22-97-1, Neb. Rev. Stat. §77-2715 requires an individual to recalculate the 1997 federal alternative minimum tax (Federal Form 6251, o…
How does a Nebraska individual recompute the 1997 federal credit for prior year minimum tax to claim the Nebraska credit?
Recompute the federal credit on Nebraska terms, then take 29.6% of it. Under Revenue Ruling 22-97-2, Neb. Rev. Stat. §77-2715(2) requires an individual to recompute the 1997 federal credit for prior y…
How may seal card and coin board games be built, approved, and sold under Nebraska's Pickle Card Lottery Act?
Seal card and coin board games are a legal form of pickle-card lottery, subject to detailed manufacturer standards. Under Revenue Ruling 35-97-2 (which supersedes 35-96-4), the Nebraska Pickle Card Lo…
Is a Nebraska warranty or service and maintenance agreement taxable when it covers fixtures, and are the repair parts taxable?
It depends on whether the agreement covers fixtures, other personal property, or both. Under Revenue Ruling 1-97-1 (sales and use tax), a warranty, guarantee, or service and maintenance agreement that…
Can property bought after a taxpayer applies for a subsequent Nebraska incentive agreement still get the property tax exemption under the first agreement?
No -- filing the second application draws the line. Under Revenue Ruling 29-96-2, property acquired after the date a taxpayer applies for a subsequent agreement covering the same project cannot qualif…
When must a Nebraska insurance company include reinsurance premiums in its one-factor apportionment formula?
Reinsurance premiums are normally left out -- unless they exceed one-third of premiums received. Under Revenue Ruling 24-96-1 (corporate income tax), an insurance company or unitary group apportions i…
When can Nebraska tax a nonresident motor carrier employee who works in more than one state?
It cannot. A nonresident motor carrier employee (as defined by federal law) who regularly performs duties on a commercial motor vehicle in more than one state can be taxed only by their state of resid…
Which nonresident rail carrier employees are exempt from Nebraska income tax when they work in more than one state?
A nonresident rail employee who regularly works on the railroad across multiple states is taxed only by their home state. Under Revenue Ruling 22-96-1, compensation paid to rail carrier employees who …
Does Nebraska sales tax apply to Internet or on-line service connection and access charges?
Access is never taxed; the initial connection is taxed only if it comes with software. Under Revenue Ruling 1-96-1 (sales and use tax), charges to end users for the initial connection to the Internet …
What counts as a single 'business location' under Nebraska's economic development incentive law?
A 'business location' is one continuous parcel of real property, or two or more contiguous parcels. Under Revenue Ruling 29-96-1, the term "business location" in Neb. Rev. Stat. §77-27,189 means one c…
What rules of play govern selling and conducting seal card games in Nebraska?
Seal card games are legal, and this ruling is the operator's rulebook for running them. Under Revenue Ruling 35-96-5, LB 1277 (effective July 19, 1996) made seal card games a legal form of lottery by …
Must a company that provides barricades, lights, and arrow boards to Nebraska contractors collect sales tax on the charge?
Providing this traffic-control equipment to contractors is a taxable lease, and tax applies to the whole charge. Under Revenue Ruling 1-94-2 (sales and use tax), persons providing barricades, high int…
At the end of a Nebraska incentive project, can a company sign a new agreement for the same activities and keep using its old credits?
Yes. Under Revenue Ruling 29-93-3, when a project's entitlement period ends, a taxpayer may enter a subsequent Employment and Investment Growth Act agreement covering the same activities as the previo…
When must I file the Nebraska Personal Property Return (Form 775P) to keep my LB 775 property tax exemption?
By May 1. Under Revenue Ruling 29-93-2, the Nebraska Personal Property Return (Form 775P), with its accompanying schedules, must be filed with the Department of Revenue on or before May 1 of each year…
Can a company just start paying the county the property taxes on property that's exempt under Nebraska's LB 775 incentive agreement?
No — not voluntarily. Under Revenue Ruling 29-93-1, property tax on personal property that is exempt under the Employment and Investment Growth Act may not be paid to the county until either the taxpa…
How does a bank figure its average deposits for the Nebraska financial institution tax when a merger creates a short tax year?
On a partial-year basis. When a merger gives a Nebraska financial institution a short tax year, the acquired institution files a short-period return and computes its average deposits under Neb. Rev. S…
Is a contract to care for and maintain live plants (like office interior plants) subject to Nebraska sales tax?
Yes. Under Revenue Ruling 01-91-2, when the owner of live plants that are not incorporated into real property buys an agreement providing for the continuing care or upkeep of those plants, the sale of…
Can I file my Nebraska tax returns on reproduced or substitute forms instead of the official printed ones?
Yes. Nebraska accepts reproduced and substitute versions of its official tax returns and schedules for every Nebraska tax program, as long as the forms follow the Department's 'Guidelines for Reproduc…
In a sale-leaseback, does property a company sells and leases back count as 'investment' for Nebraska's LB 775 incentive?
Only if it was first put into service after the application. Under Revenue Ruling 29-91-3, when a taxpayer leases property in a sale-leaseback that it previously owned, that property qualifies as 'inv…
Which computer peripheral components qualify for Nebraska's LB 775 personal property tax exemption under the amended, post-1989 rule?
Only six specifically listed components, and only if climate-controlled. Under Revenue Ruling 29-91-2 — which applies the amended definition in Neb. Rev. Stat. § 77-4105(2)(b), R.S.Supp. 1988 — only t…
Which computer peripheral components qualify for Nebraska's LB 775 personal property tax exemption under the older, pre-1989 rule?
They must directly communicate with the mainframe business computer. Under Revenue Ruling 29-91-1 — which applies the older statutory definition (Neb. Rev. Stat. § 77-4105(2)(b), R.S.Supp. 1987, exemp…
If I got founding stock in a corporation I helped create as an employee, does it qualify for Nebraska's capital gains exclusion?
Yes, it can. Under Revenue Ruling 22-90-4, stock received in the creation of a corporation by an employee-investor may qualify for the capital gains income adjustment (exclusion) provided by Neb. Rev.…
When is a Nebraska financial institution tax return due when the bank has a short tax year?
By the 15th day of the third month after the short year ends. Under Revenue Ruling 24-90-1, when a financial institution has a short tax year, its Nebraska financial institution tax return must be fil…
When a company covered by Nebraska's Employment Expansion and Investment Incentive Act opens a new location partway through the year, whose taxable year does it use to figure employment and investment?
The company's taxable year as a whole. Under Revenue Ruling 29-90-2, for the Employment Expansion and Investment Incentive Act the calculation of employment and investment must be determined based on …
Do I owe Nebraska income tax on unemployment or sickness benefits I got from the Railroad Retirement Board?
No — they're subtracted out. Under Revenue Ruling 22-90-3, unemployment or sickness insurance benefits paid by the Railroad Retirement Board are proper Nebraska adjustments decreasing federal adjusted…
On a short-period Nebraska return under the Employment Expansion and Investment Incentive Act, do I change how I figure the qualified-employee and qualified-investment credits on Form 3800N?
Modify the employee side, not the investment side. Under Revenue Ruling 29-90-1, for the Employment Expansion and Investment Incentive Act the Qualified Employee Calculation on Form 3800N must be modi…
What makes a mainframe business computer qualify for Nebraska's LB 775 personal property tax exemption?
It has to sit in its own environmentally controlled area. Under Revenue Ruling 29-89-1, mainframe computers must be located in a separately supported, environmentally controlled area to qualify for th…
Is dry ice and packing material used to ship perishable products in disposable coolers subject to Nebraska sales tax?
Not if it's part of the disposable package sold to the customer. Under Revenue Ruling 01-88-7, dry ice placed with other packing materials into an insulated cooler containing meat products the taxpaye…
Do I owe Nebraska income tax on a lump-sum payment I got from the railroad as an early-retirement incentive?
Yes — it's taxable. Under Revenue Ruling 22-88-5, individuals who receive lump-sum railroad payments as incentives for early retirement must include those distributions as income for Nebraska individu…
If Form 3800N rounds my employee growth up to two, do I qualify for Nebraska's employment-expansion tax incentive without actually hiring two?
No — rounding on the form isn't enough; you must actually add two. Under Revenue Ruling 29-88-3, an expanding business does not meet the increased-employment requirement for tax incentives under the E…
If a portion of my deferred installment-sale income is deemed received under the federal proportionate disallowance rule, can I spread the resulting Nebraska tax over several years the way federal law lets me?
No -- the Nebraska tax is due all at once. Under Revenue Ruling 22-88-3, the amount of income that federal law deems received under the proportionate disallowance rule for installment sales (Internal …
Can a Nebraska company cancel its Employment and Investment Growth Act (LB 775) agreement and instead claim credits under the Employment Expansion and Investment Incentive Act?
Yes, if it cancels the first agreement and meets three conditions. Under Revenue Ruling 29-88-2, a taxpayer that signed an Employment and Investment Growth Act (LB 775) agreement -- and later expects …
When a Nebraska individual income tax return covers a short period (less than a full year), does the tax have to be annualized and do the exemptions and deductions get prorated?
No annualization or proration of the basic tax. Under Revenue Ruling 22-88-2, a short-period Nebraska individual income tax return is treated as a return for a separate taxable year, and the individua…
Can a Nebraska S corporation with an Employment and Investment Growth Act (LB 775) agreement elect the single sales-factor apportionment formula, even though the credit itself flows through to shareholders?
Yes. Under Revenue Ruling 29-88-1, an S corporation may elect to use the single (sales-only) factor apportionment formula provided in Neb. Rev. Stat. section 77-4105 of the Employment and Investment G…
If a company moves used equipment from another state into its Nebraska LB 775 project, does that equipment count as a qualifying investment in Nebraska?
Yes. Under Revenue Ruling 29-87-8, qualified property placed in service in Nebraska for the first time after filing an application under the Employment and Investment Growth Act (LB 775) is an investm…
For Nebraska's LB 775 personal property tax exemption, do 'agricultural products' include partially-processed farm goods that a company buys and processes further before they reach the consumer?
Yes. Under Revenue Ruling 29-87-9, 'agricultural products' for purposes of the LB 775 personal property tax exemption include products grown or raised on the farm or ranch and the intermediate product…
For Nebraska's LB 775 incentives, how are leases between members of the same unitary group treated -- do they create qualifying investment or disqualify rented-out property?
They are disregarded, because the unitary group is a single taxpayer. Under Revenue Ruling 29-87-7, for the Employment and Investment Growth Act a unitary group of corporations is only one taxpayer, s…
If an employee works at my Nebraska LB 775 project and also at my other locations, can I count them toward the new-employee and wage-credit calculations?
Yes, but only for the work done at the project. Under Revenue Ruling 29-87-6, new employees (who are not base-year employees) working at more than one of the taxpayer's locations can be included in de…
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These are official tax letter rulings and advisory opinions issued by Nebraska's revenue authority in response to questions from specific taxpayers about how the tax law applies to their facts. A ruling is binding on the department only for the taxpayer who requested it and cannot be relied on by anyone else, but it is strong evidence of how the state reads the law. Every ruling above has a plain-English question and short answer, plus a link to the full original source.