Senators began debate May 16 on a bill that would make changes to the computation of income taxes.<\/p>\n
LB308, introduced by Columbus Sen. Paul Schumacher, would eliminate the federal alternative minimum tax (AMT) calculation for individual state income tax purposes for taxable years beginning Jan. 1, 2014.<\/p>\n
Schumacher said the AMT originally was intended to apply only to the very wealthy, but in fact impacts many people making more than $75,000 annually.<\/p>\n
\u201cThe alternative minimum tax calculation no longer serves its original purpose of targeting tax dodgers,\u201d he said. \u201cInstead, it targets the exact kind of hardworking, educated and productive people we want to attract to Nebraska.\u201d<\/p>\n
The proposed changes would apply to estates and trusts required to pay state income taxes. It also would eliminate the federal credit for prior year AMT for taxable years beginning in 2014.<\/p>\n
A pending Revenue Committee amendment would incorporate provisions of LB457, originally introduced by Omaha Sen. Bob Krist. The amendment would increase the carry-forward period for a net operating loss (NOL) from five years to 20 years for taxable years beginning in 2014. Currently, taxpayers can deduct a NOL for five taxable years following the year of loss.<\/p>\n
Revenue Committee chairperson Sen. Galen Hadley said only five other states have shorter carry-forward periods than Nebraska\u2019s.<\/p>\n
\u201c[The current policy] is penalizing startup businesses,\u201d Hadley said. \u201cThese are the very businesses we want to come to Nebraska, stay here and be successful.\u201d<\/p>\n
Omaha Sen. Ernie Chambers introduced an amendment that would have implemented provisions of LB266, a bill he originally introduced, that would repeal a 2012 law allowing municipalities to vote for an increase in local option sales taxes.<\/p>\n
Chambers said any municipalities that already have increased their local option sales taxes could be grandfathered in.<\/p>\n
\u201cThis is a regressive tax that [disproportionately] affects the poor,\u201d he said. \u201cThe richest person who purchases something pays no higher rate than the poorest person.\u201d<\/p>\n
Omaha Sen. Brad Ashford, a co-sponsor of LB266, supported the amendment. He said Nebraska must act to become more competitive with neighboring states.<\/p>\n
\u201cWe\u2019re on the verge of making significant tax reform in our state,\u201d Ashford said. \u201cThe only realistic way to do that is to remove many of the loopholes and exemptions we\u2019ve created in our tax code since 1967.\u201d<\/p>\n
Wahoo Sen. Jerry Johnson opposed the amendment, saying municipalities have not had enough time to take advantage of the law.<\/p>\n
\u201cTaking away the local option sales tax right now is premature,\u201d he said. \u201cWe should let the [proposed] tax commission study look at all phases of this and let it correct any issues we may find.\u201d<\/p>\n
The Chambers amendment failed on a 23-16 vote. Omaha Sen. Beau McCoy filed a motion to reconsider the vote.<\/p>\n
The motion to reconsider and both amendments were pending when the Legislature adjourned for the week.<\/p>\n","protected":false},"excerpt":{"rendered":"
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