Senators passed a bill May 20 intended to modernize the state’s small business tax credit.
Under the Nebraska Advantage Microenterprise Tax Credit Act, a business with five or fewer full-time employees can apply to receive a refundable tax credit designed to help decrease the cost of startup and expansion.
The program, which offers a tax credit to approved microbusiness taxpayers for new investment or employment equal to 20 percent of the investment amount — up to a maximum of $10,000 — had been set to expire in 2022. Total credits approved under the program are limited to $2 million annually.
LB366, introduced by Albion Sen. Tom Briese, extends the program expiration date through 2032. It also raises the maximum lifetime tax credits claimed by any individual from $10,000 to $20,000.
Finally, the bill strengthens reporting requirements and allows certain family members of a person who has received the maximum credit also to participate in the program — as long as ownership is not shared and the businesses are completely separate.
The changes made by LB366 apply only to applications made after the bill’s operative date.
The bill passed on a vote of 44-1.