LB 803

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                     LEGISLATIVE BILL 803
                    Approved by the Governor April 16, 2026
Introduced by Revenue Committee: von Gillern, 4, Chairperson; Bostar, 29;
              Jacobson, 42; Kauth, 31; Murman, 38.
A BILL FOR AN ACT relating to revenue and taxation; to amend sections 13-3105,
     77-1315, and 77-3510, Reissue Revised Statutes of Nebraska, sections
     13-3108, 77-1502, 77-1601, 77-1776, and 77-3512, Revised Statutes
     Cumulative Supplement, 2024, sections 13-3103, 13-3106, 13-3403, 77-1632,
     77-2716, and 77-3506, Revised Statutes Supplement, 2025, and section 2,
     Legislative Bill 901, One Hundred Ninth Legislature, Second Session, 2026;
     to adopt the First-Time Home Buyer Savings Account Act; to change
     provisions relating to the Sports Arena Facility Financing Assistance Act,
     the Property Tax Growth Limitation Act, property tax valuation and levy
     procedures, and homestead exemptions; to require a joint public hearing
     regarding property tax valuation and political subdivision budgets; to
     provide an adjustment to income for income tax purposes; to change
     provisions relating to certain refundable income tax credits; to harmonize
     provisions; to provide operative dates; to repeal the original sections;
     to outright repeal sections 77-1630 and 77-1634, Revised Statutes
     Cumulative Supplement, 2024, section 77-1631, Revised Statutes Supplement,
     2025, and section 77-1633, Revised Statutes Supplement, 2025, as amended
     by section 1, Legislative Bill 384, One Hundred Ninth Legislature, Second
     Session, 2026; and to declare an emergency.
Be it enacted by the people of the State of Nebraska,
     Section 1. Sections 1 to 8 of this act shall be known and may be cited as
the First-Time Home Buyer Savings Account Act.
     Sec. 2.   The Legislature declares that the purpose of allowing taxable
income to be reduced by contributions to and earnings from a first-time home
buyer savings account is to encourage first-time home ownership through
incentivizing saving for a downpayment and closing costs because of the
significant financial and civic benefits home ownership provides for this
state.
     Sec. 3. For purposes of the First-Time Home Buyer Savings Account Act:
     (1) Account holder means an individual who establishes an account with a
financial institution that is designated as a first-time home buyer savings
account;
     (2) Department means the Department of Revenue;
     (3) Eligible expenses means a downpayment and any closing costs included
on a real estate settlement statement, including, but not limited to, appraisal
fees, mortgage origination fees, and inspection fees or any downpayment costs
and fees that may be included as part of financing the construction of a
primary residence;
     (4) Financial institution means a bank, savings bank, building and loan
association, savings and loan association, or credit union, whether chartered
by the United States, the Department of Banking and Finance, or a foreign state
agency; any other similar organization which is covered by federal deposit
insurance; or a trust company;
     (5) First-time home buyer means an individual who:
     (a) Has never owned or purchased under contract for deed, either
individually or jointly, a single-family, owner-occupied primary residence,
including, but not limited to, a condominium unit or a manufactured or mobile
home that is assessed and taxed as real property; or
     (b) As a result of the individual's dissolution of marriage, has not been
listed on a property title for at least three consecutive years or more;
     (6) First-time home buyer savings account or account means an account with
a financial institution designated as a first-time home buyer savings account
in accordance with section 4 of this act; and
     (7) Qualified beneficiary means a first-time home buyer designated by an
account holder for whom the money in a first-time home buyer savings account is
or will be used for eligible expenses for the purchase of the qualified
beneficiary's primary residence.
     Sec. 4. (1) Beginning January 1, 2027, any individual may open an account
with a financial institution and designate the account, in its entirety, as a
first-time home buyer savings account to be used to pay or reimburse a
qualified beneficiary's eligible expenses for the purchase or construction of a
primary residence in Nebraska. An individual may be the account holder of
multiple accounts, and an individual may jointly own the account with another
person if they file a joint income tax return. To be eligible for the
subtraction under subsection (27) of section 77-2716, an account holder must
comply with the requirements of this section.
     (2) An account holder must designate, no later than April 15 of the year
following the taxable year during which the account is established, a first-
time home buyer as the qualified beneficiary of the first-time home buyer
savings account. The account holder may designate himself or herself as the
qualified beneficiary. The account holder may change the designated qualified
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beneficiary at any time, but there shall not be more than one qualified
beneficiary at any time. An account holder shall not have multiple accounts
with the same qualified beneficiary, but an individual may be designated as the
qualified beneficiary of multiple accounts.
     (3) The following limits apply to a first-time home buyer savings account:
     (a) The maximum contribution to a first-time home buyer savings account
for a taxable year is five thousand dollars for an individual and ten thousand
dollars for account holders who file a joint return; and
     (b) The maximum amount of all contributions for all taxable years to a
first-time home buyer savings account is twenty-five thousand dollars for an
individual and fifty thousand dollars for account holders who file a joint
return.
     (4) Money may remain in a first-time home buyer savings account for
unlimited duration without the contributions being subject to recapture or
penalty.
     (5) The account holder shall not use money in an account to pay expenses
of administering the account, except that a service fee may be deducted from
the account by a financial institution.
     (6) The account holder is responsible for maintaining documentation for
the first-time home buyer savings account and for eligible expenses related to
the qualified beneficiary's purchase of his or her primary residence.
     Sec. 5. (1)(a) The money in a first-time home buyer savings account may
be:
     (i) Used for eligible expenses related to a qualified beneficiary's
purchase or construction of his or her primary residence in this state;
     (ii) Used for eligible expenses related to a qualified beneficiary's
purchase or construction of his or her primary residence in or outside the
state if the qualified beneficiary is active-duty military and was stationed in
Nebraska for any time after the creation of the account;
     (iii) Used for expenses that would have qualified under subdivision (1)(a)
(i) or (ii) of this section, but the contract for purchase or construction did
not close;
     (iv) Transferred to another newly created first-time home buyer savings
account; or
     (v) Used to pay a service fee that is assessed and deducted by the
financial institution.
     (b) Subdivision (1)(a) of this section applies regardless of whether the
qualified beneficiary is the sole owner of the primary residence or a joint
owner with another person who does not qualify as a qualified beneficiary.
     (c) The money in a first-time home buyer savings account may not be used
for the purposes described in subdivisions (1)(a)(i), (ii), and (iii) of this
section if the primary residence being purchased or constructed is a
manufactured or mobile home that is not taxed as real property.
     (2)(a) Money withdrawn from a first-time home buyer savings account is
subject to recapture in the taxable year in which it is withdrawn if:
     (i) At the time of the withdrawal, it has been less than a year since the
first deposit in the first-time home buyer savings account; or
     (ii) The money is used for any purpose other than those authorized in
subsection (1) of this section.
     (b) The amount subject to recapture shall be added to federal adjusted
gross income pursuant to subdivision (27)(b) of section 77-2716.
     (3) If any money is subject to recapture pursuant to subdivision (2)(a)
(ii) of this section, the account holder shall pay to the department a penalty
in the same taxable year as the recapture. If the withdrawal is made ten or
fewer years after the first deposit in the first-time home buyer savings
account, the penalty is equal to five percent of the amount subject to
recapture. If the withdrawal is made more than ten years after the first
deposit in the account, the penalty is equal to ten percent of the amount
subject to recapture. The penalties provided in this subsection do not apply
if:
     (a) The money is used for eligible expenses related to a qualified
beneficiary's purchase or construction of his or her primary residence outside
of the state; or
     (b) The money is from a first-time home buyer savings account for which
the qualified beneficiary dies and the account holder does not designate a new
qualified beneficiary during the same taxable year.
     (4) If the account holder or, if the first-time home buyer savings account
is jointly owned, the account holders die, all of the money in the account that
was subtracted from taxable income is subject to recapture in the taxable year
of the death or deaths, but no penalty is due to the department.
     Sec. 6.   The department shall establish a form for an account holder to
annually report information about a first-time home buyer savings account,
including, but not limited to, how the money from the account is used, and
shall identify any supporting documentation that is required to be maintained.
To be eligible for the subtraction in subsection (27) of section 77-2716, an
account holder must annually file with his or her state income tax return the
completed form, the 1099 form for the account issued by the financial
institution, and any other supporting documentation the department requires.
     Sec. 7. (1) A financial institution is not required to:
     (a) Designate an account as a first-time home buyer savings account, or
designate the qualified beneficiaries of an account, in the financial
institution's account contracts or systems or in any other way;
     (b) Track the use of money withdrawn from a first-time home buyer savings
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account; or
     (c) Report any information to the department or any other governmental
agency that is not otherwise required by law.
     (2) A financial institution is not responsible or liable for:
     (a) Determining or ensuring that an account holder is eligible for a
subtraction under subsection (27) of section 77-2716;
     (b) Determining or ensuring that money in the account is used for an
eligible expense; or
     (c) Reporting or remitting taxes or penalties related to the use of money
in a first-time home buyer savings account.
     (3) In implementing the First-Time Home Buyer Savings Account Act, the
department shall not establish any administrative, reporting, or other
requirements on financial institutions that are outside the scope of normal
account procedures.
     Sec. 8. The department may adopt and promulgate rules and regulations to
carry out the First-Time Home Buyer Savings Account Act.
     Sec. 9. Section 13-3103, Revised Statutes Supplement, 2025, is amended to
read:
     13-3103 (1) Any applicant may apply to the board for state assistance if
(a) the applicant has acquired, constructed, improved, or equipped an eligible
sports arena facility, (b) the applicant has approved a revenue bond issue or a
general obligation bond issue to acquire, construct, improve, or equip an
eligible sports arena facility, (c) the applicant has adopted a resolution
authorizing the applicant to pursue a general obligation bond issue to acquire,
construct, improve, or equip an eligible sports arena facility, (d) a building
permit has been issued within the applicant's jurisdiction for an eligible
sports arena facility that is a privately owned concert venue, (e) a building
permit has been issued or construction has been completed within the
applicant's jurisdiction for an eligible sports arena facility that is a
privately owned sports complex, or (f) each coapplicant described in
subdivision (1)(b) of section 13-3102 has adopted a resolution authorizing
either the political subdivision or the nonprofit corporation to pursue
financing or bonds to acquire, construct, improve, or equip an eligible sports
arena facility for the purposes set forth in subdivision (4)(b) of this section
13-3103.
     (2) Except as provided in subsections (3) and (4) of this section, the
state assistance shall only be used by the applicant to pay back amounts
expended or borrowed through one or more issues of bonds to be expended by the
applicant to acquire, construct, improve, or equip the publicly owned eligible
sports arena facility and to acquire, construct, improve, or equip publicly
owned nearby parking facilities.
     (3) For an eligible sports arena facility that is a privately owned
concert venue, the state assistance shall only be used by the applicant (a) to
pay back amounts expended or borrowed through one or more issues of bonds to be
expended by the applicant to acquire, construct, improve, or equip a nearby
parking facility or (b) to promote arts and cultural events which are open to
or made available to the general public.
     (4) For an eligible sports arena facility that is a privately owned sports
complex, the state assistance shall only be used by the applicant:
     (a) To pay back amounts expended or borrowed through one or more issues of
bonds to be expended by the applicant to acquire, construct, improve, or equip
one or more public infrastructure projects, as defined in section 77-27,142,
related to a privately owned sports complex;
     (b) To lease all or a portion of such privately owned sports complex for
the governmental use of the political subdivision. For purposes of this
subdivision, lease means any contractual lease agreement between the
coapplicants described in subdivision (1)(b) of section 13-3102 for the use of
an eligible sports arena facility at fair market rental value for a term not to
exceed twenty years;
     (c) To promote sporting events which are open to or made available to the
general public; or
     (d) To pay back amounts expended or borrowed through one or more debt
issues to be expended by the nonprofit corporation coapplicant to acquire,
construct, improve, or equip a privately owned sports complex, subject to voter
approval as provided in section 13-3110.
     (5)(a) No more than ten years of funding for promotion of the arts and
cultural events shall be paid by state assistance received pursuant to section
13-3108.
     (b) No more than ten years of funding for promotion of sporting events
shall be paid by state assistance received pursuant to section 13-3108.
     (c) No more than ten five years of funding for a sports complex located in
a city of the second class or village shall be paid by state assistance
received pursuant to section 13-3108.
     (6) For any application for state assistance for a large public stadium
approved on or after July 19, 2024, up to one hundred percent of the final cost
of the project may be funded by state assistance received pursuant to section
13-3108.
     Sec. 10. Section 13-3105, Reissue Revised Statutes of Nebraska, is amended
to read:
     13-3105 (1) Within sixty days after completing the board's review of an
application under subsection (4) of After reviewing an application submitted
under section 13-3104, the board shall hold a public hearing on the
application.
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     (2) The board shall give notice of the time, place, and purpose of the
public hearing by publication three times in a newspaper of general circulation
in the area where the political subdivision submitting the application is
located. Such publication shall be not less than ten days prior to the hearing.
The notice shall describe generally the project for which state assistance has
been requested. The applicant shall pay the cost of the notice.
     (3) At the public hearing, representatives of the applicant and any other
interested persons may appear and present evidence and argument in support of
or in opposition to the application or neutral testimony. The board may seek
expert testimony and may require testimony of persons whom the board desires to
comment on the application. The board may accept additional evidence after
conclusion of the public hearing.
     Sec. 11. Section 13-3106, Revised Statutes Supplement, 2025, is amended to
read:
     13-3106 (1) After consideration of the application and the evidence, the
board shall determine whether or not to approve the application. For
applications submitted on or after the operative date of this section, the
board shall make its determination within sixty days after the public hearing
held pursuant to section 13-3105. For applications submitted prior to the
operative date of this section, the board shall make its determination within
sixty days after the public hearing held pursuant to section 13-3105 or within
sixty days after the operative date of this section, whichever period is later.
The application shall be approved unless the board finds that the project
described in the application is ineligible or that state assistance in not in
the best interest of the state. if the board finds that the project described
in the application is eligible and that state assistance is in the best
interest of the state, the application shall be approved, except that:
     (2) (a) An approval of an application submitted because of the requirement
in subdivision (1)(c) of section 13-3103 is a temporary approval. If the
general obligation bond issue is subsequently approved by the voters of the
political subdivision, the approval by the board becomes permanent. If the
general obligation bond issue is not approved by such voters, the temporary
approval shall become void. ; and
     (3) (b) An approval of an application submitted because of the requirement
in subdivision (1)(f) of section 13-3103 is a temporary approval. If a building
permit for the eligible sports arena facility is issued within twenty-four
months of the temporary approval, the approval by the board becomes permanent.
If a building permit is not issued within twenty-four months of the temporary
approval, the temporary approval shall become void.
     (4) (2) In determining whether state assistance is in the best interest of
the state, the board may shall consider the fiscal and economic capacity of the
applicant to finance the local share of the project.
     (5) (3) A majority of the board members constitutes a quorum for the
purpose of conducting business. All actions of the board shall be by a majority
vote of all the board members present at the board meeting , one of whom must
be the Governor.
     Sec. 12. Section 13-3108, Revised Statutes Cumulative Supplement, 2024, is
amended to read:
     13-3108 (1) The Sports Arena Facility Support Fund is created. Any money
in the fund available for investment shall be invested by the state investment
officer pursuant to the Nebraska Capital Expansion Act and the Nebraska State
Funds Investment Act.
     (2)(a) Upon receiving the certification described in subsection (3) of
section 13-3107, the State Treasurer shall transfer the amount certified to the
fund.
     (b) Upon receiving the quarterly certification described in subsection (4)
of section 13-3107, the State Treasurer shall transfer the amount certified to
the fund.
     (3)(a) It is the intent of the Legislature to appropriate from the fund
money to be distributed as provided in subsections (4) and (5) of this section
to any political subdivision for which an application for state assistance
under the Sports Arena Facility Financing Assistance Act has been approved an
amount not to exceed:
     (i) For any eligible sports arena facility that is not a sports complex
located in a city of the second class or village, seventy percent of the (A)
state sales tax revenue collected by retailers doing business at eligible
sports arena facilities on sales at such facilities, (B) state sales tax
revenue collected on primary and secondary box office sales of admissions to
such facilities, and (C) new state sales tax revenue collected by nearby
retailers and sourced under sections 77-2703.01 to 77-2703.04 to the program
area; or
     (ii) For any eligible sports arena facility that is a sports complex
located in a city of the second class or village, twenty-five percent of the
(A) state sales tax revenue collected by retailers doing business at eligible
sports arena facilities on sales at such facilities, (B) state sales tax
revenue collected on primary and secondary box office sales of admissions to
such facilities, and (C) new state sales tax revenue collected by nearby
retailers and sourced under sections 77-2703.01 to 77-2703.04 to the program
area.
     (b) The amount to be appropriated for distribution as state assistance to
a political subdivision under this subsection for any one year after the tenth
year shall not exceed the highest such amount appropriated under subdivision
(3)(a) of this section during any one year of the first ten years of such
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appropriation. If seventy percent of the state sales tax revenue as described
in subdivision (3)(a) of this section exceeds the amount to be appropriated
under this subdivision, such excess funds shall be transferred to the General
Fund. This subdivision does not apply to any eligible sports arena facility
that is a sports complex located in a city of the second class or village.
     (4) The amount certified under subsection (3) of section 13-3107 shall be
distributed as state assistance on or before April 15, 2014.
     (5) Beginning in 2014, quarterly distributions and associated transfers of
state assistance shall be made. Such quarterly distributions and transfers
shall be based on the certifications provided under subsection (4) of section
13-3107 and shall occur within fifteen days after receipt of such
certification.
     (6)(a) Except as provided in subdivision (6)(b) of this section, the total
amount of state assistance approved for an eligible sports arena facility shall
not exceed one hundred million dollars.
     (b) For any eligible sports arena facility that is a large public stadium:
     (i) The total amount of state assistance approved for such facility shall
not exceed twenty-five million dollars;
     (ii) The amount of state assistance approved for such facility for any
year shall not exceed one million two hundred fifty thousand dollars; and
     (iii) No state assistance for any large public stadium shall be paid until
after July 1, 2027.
     (7)(a) Except as provided in subdivisions (b), (c), and (d) of this
subsection, state assistance to the political subdivision shall no longer be
available upon the retirement of the bonds issued to acquire, construct,
improve, or equip the facility or any subsequent bonds that refunded the
original issue or when state assistance reaches the amount determined under
subdivision (6)(a) of this section, whichever comes first.
     (b) If the state assistance will be used to provide funding for promotion
of the arts and cultural events or for promotion of sporting events, such state
assistance to the political subdivision shall no longer be available after ten
years of funding or when state assistance reaches the amount determined under
subdivision (6)(a) of this section, whichever comes first.
     (c) If the state assistance will be used to provide funding for a sports
complex located in a city of the second class or village, such state assistance
to the political subdivision shall no longer be available after ten five years
of funding or when state assistance reaches the amount determined under
subdivision (6)(a) of this section, whichever comes first.
     (d) If the state assistance will be used to provide funding for a large
public stadium, such state assistance to the political subdivision shall no
longer be available after twenty years of funding or when state assistance
reaches the amount determined under subdivision (6)(b)(i) of this section,
whichever comes first.
     (8) State assistance shall not be used for an operating subsidy for any
publicly owned eligible sports arena facility or nearby parking facility.
     (9) The thirty percent of state sales tax revenue remaining after the
appropriation and transfer in subdivision (3)(a)(i) of this section shall be
appropriated by the Legislature and transferred quarterly as follows:
     (a) If the revenue relates to an eligible sports arena facility that is a
sports complex and that is approved for state assistance under section 13-3106
on or after May 26, 2021, eighty-three percent of such revenue shall be
transferred to the Support the Arts Cash Fund and seventeen percent of such
revenue shall be transferred to the Convention Center Support Fund; and
     (b) If the revenue relates to any other eligible sports arena facility,
such revenue shall be transferred to the Civic and Community Center Financing
Fund.
     (10) The seventy-five percent of state sales tax revenue remaining after
the appropriation and transfer in subdivision (3)(a)(ii) of this section shall
be distributed in accordance with section 77-27,132.
     (11) Except as provided in subsection (12) of this section for a city of
the primary class, any municipality that has applied for and received a grant
of assistance under the Civic and Community Center Financing Act shall not
receive state assistance under the Sports Arena Facility Financing Assistance
Act for the same project for which the grant was awarded under the Civic and
Community Center Financing Act.
     (12) A city of the primary class shall not be eligible to receive a grant
of assistance from the Civic and Community Center Financing Act if the city has
applied for and received a grant of assistance under the Sports Arena Facility
Financing Assistance Act.
     Sec. 13. Section 13-3403, Revised Statutes Supplement, 2025, is amended to
read:
     13-3403 (1) Except as otherwise provided in the Property Tax Growth
Limitation Act, for fiscal years beginning on or after July 1, 2025, a
political subdivision's property tax request for any year shall not exceed its
property tax request authority as determined under this section. The
preliminary property tax request authority for each political subdivision shall
be the amount of property taxes requested and approved by each political
subdivision and included on the budget document filed with the auditor in the
prior fiscal year pursuant to subsection (2) of section 13-506, less the sum of
exceptions utilized in the prior year pursuant to subdivisions (1), (2), (4),
(5), (6), and to (7) of section 13-3404.
     (2) In addition to the preliminary property tax request authority, the
political subdivision's property tax request authority may be increased by:
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     (a) The product of (i) the amount of property taxes levied in the prior
year, less the sum of exceptions utilized in the prior year pursuant to
subdivisions (1) and (2) of section 13-3404, and (ii) the political
subdivision's growth percentage; and
     (b) The product of (i) the amount of property taxes levied in the prior
year, less the sum of exceptions utilized in the prior year pursuant to
subdivisions (1) and (2) of section 13-3404, and (ii) the greater of zero or
the inflation percentage.
     Sec. 14. Section 77-1315, Reissue Revised Statutes of Nebraska, is amended
to read:
     77-1315 (1) The county assessor shall, after March 19 and on or before
June 1, implement adjustments to the real property assessment roll for actions
of the Tax Equalization and Review Commission, except beginning January 1,
2014, in any county with a population of at least one hundred fifty thousand
inhabitants according to the most recent federal decennial census, the
adjustments shall be implemented after March 25 and on or before June 1.
     (2) On or before June 1, in addition to the notice of preliminary
valuation sent pursuant to section 77-1301, the county assessor shall create a
notice to be delivered to notify the owner of record as of May 20 of the
assessed value of every item of real property not exempt from taxation which
has been assessed at a value different than in the previous year. Such notice
shall be delivered given by first-class mail addressed to such owner's last-
known address. It shall identify the item of real property and shall display a
column for the prior tax year and the current tax year. Under the column for
the prior tax year, the notice shall display the valuation of the parcel in the
prior tax year, the amount each city, county, and school district levied
against such parcel in the prior tax year, and the total amount of taxes levied
against such parcel in the prior tax year by the city, county, and school
district. Under the column for the current tax year, the notice shall display
the valuation of the parcel in the current tax year and the total amount of
taxes that would be levied against such parcel by each city, county, and school
district using the previous year's rate of levy. The notice shall state that
the tax amounts do not include any homestead exemptions or property tax
credits. The notice shall state the following, in a font size larger than any
other font appearing on the notice: "KNOW YOUR RIGHTS: If you believe the
valuation of the parcel described in this notice to be in error, you may file a
protest of this valuation with the county clerk on or before June 30, and your
protest shall be decided by the county board of equalization. Your protest must
be accompanied by documentation sufficient to justify the requested valuation;
if not, your protest will be dismissed. If you are concerned about the effect
your valuation may have on how much tax will be levied against your parcel, you
are encouraged to attend any and all of the budget hearings for the political
subdivisions listed above. This notice displays the amount of tax which would
be levied if the levy rate for each of the listed political subdivisions were
unchanged from the prior year. The valuation for your parcel will not be
certified to the listed political subdivisions by the county until August 20."
The notice shall include the date of convening of the county board of
equalization and the dates for filing a protest. The notice shall also state
the following: "The time and place of the budget hearings will be reported to
the county assessor by each political subdivision listed above on or before
June 1. Such time and place can change based on unforeseen circumstances. You
are encouraged to verify with each listed political subdivision that the time
and place of the budget hearings has not changed. You will receive a postcard
from the state, mailed on or before July 1, which will provide further
information." state the old and new valuation, the date of convening of the
county board of equalization, and the dates for filing a protest.
     (3) Immediately upon completion of the assessment roll, the county
assessor shall cause to be published in a newspaper of general circulation in
the county a certification that the assessment roll is complete and notices of
valuation changes have been mailed and provide the final date for filing
valuation protests with the county board of equalization.
     (4) The county assessor shall annually, on or before June 6, post in his
or her office and, as designated by the county board, mail to a newspaper of
general circulation and to licensed broadcast media in the county the
assessment ratios as found in his or her county as determined by the Tax
Equalization and Review Commission and any other statistical measures,
including, but not limited to, the assessment-to-sales ratio, the coefficient
of dispersion, and the price-related differential.
     (5) On or before June 1, each political subdivision levying a tax against
property shall inform the county assessor of every county in which the
political subdivision has the authority to levy such tax of the time and place
of the political subdivision's first budget hearing. Failure by a political
subdivision to comply with this subsection shall not (a) constitute a violation
of this subsection by the county assessor, (b) invalidate the political
subdivision's property tax request, or (c) constitute an unauthorized levy
under section 77-1606. For purposes of this subsection, political subdivision
means a county, city, or school district.
     (6) On or before June 1, the county assessor shall send the Property Tax
Administrator a report which includes:
     (a) The name and address of every person receiving the notice required by
subsection (2) of this section; and
     (b) The county's website address where the following information shall be
posted:
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     (i) The time and place of the first budget hearing for the county and each
city and school district authorized to levy a tax within the county; and
     (ii) The time and place of the joint public hearing held pursuant to
section 18 of this act.
     (7) On or before June 25, the Department of Revenue shall send each person
listed in the report provided pursuant to subsection (6) of this section a
postcard containing information about the website address described in
subdivision (6)(b) of this section.
     Sec. 15. Section 77-1502, Revised Statutes Cumulative Supplement, 2024, is
amended to read:
     77-1502 (1) The county board of equalization shall meet for the purpose of
reviewing and deciding written protests filed pursuant to this section
beginning on or after June 1 and ending on or before July 25 of each year.
Protests regarding real property shall be signed and filed after the county
assessor's completion of the real property assessment roll required by section
77-1315 and on or before June 30. For protests of real property, a protest
shall be filed for each parcel. Protests regarding taxable tangible personal
property returns filed pursuant to section 77-1229 from January 1 through May 1
shall be signed and filed on or before June 30. The county board in a county
with a population of more than one hundred thousand inhabitants based upon the
most recent federal decennial census may adopt a resolution to extend the
deadline for hearing protests from July 25 to August 10. The resolution must be
adopted before July 25 and it will affect the time for hearing protests for
that year only. By adopting such resolution, such county waives any right to
petition the Tax Equalization and Review Commission for adjustment of a class
or subclass of real property under section 77-1504.01 for that year.
     (2) Each protest shall be made on a form prescribed by the Tax
Commissioner, signed, and filed with the county clerk of the county where the
property is assessed. It shall be acceptable for a county to create its own
form, including an electronic form, as long as the form captures the
information required by this subsection. The protest shall contain or have
attached a statement of the reason or reasons why the requested change should
be made, including the requested valuation, documentation sufficient for the
county board of equalization to determine a different valuation, and a
description of the property to which the protest applies. If the property is
real property, a description adequate to identify each parcel shall be
provided. If the property is tangible personal property, a physical description
of the property under protest shall be provided. If the protest does not
contain or have attached the statement of the reason or reasons for the
protest, including the requested valuation, documentation sufficient for the
county board of equalization to determine a different valuation, and or the
applicable description of the property, the protest shall be dismissed by the
county board of equalization. Counties may make reasonable efforts to contact
protesters who have timely filed a protest but have either filed incomplete
information or not used the required form. The protest shall also indicate
whether the person signing the protest is an owner of the property or a person
authorized to protest on behalf of the owner. If the person signing the protest
is a person authorized to protest on behalf of the owner, such person shall
provide the authorization with the protest. If the person signing the protest
is not an owner of the property or a person authorized to protest on behalf of
the owner, the county clerk shall mail a copy of the protest to the owner of
the property at the address to which the property tax statements are mailed.
     (3) Beginning January 1, 2014, in counties with a population of at least
one hundred fifty thousand inhabitants according to the most recent federal
decennial census, for a protest regarding real property, each protester shall
be afforded the opportunity to meet in person with the county board of
equalization or a referee appointed under section 77-1502.01 to provide
information relevant to the protested property value.
     (4) No hearing of the county board of equalization on a protest filed
under this section shall be held before a single commissioner or supervisor.
     (5) The county clerk or county assessor shall prepare a separate report on
each protest. The report shall include (a) a description adequate to identify
the real property or a physical description of the tangible personal property
to which the protest applies, (b) any recommendation of the county assessor for
action on the protest, (c) if a referee is used, the recommendation of the
referee, (d) the date the county board of equalization heard the protest, (e)
the decision made by the county board of equalization, (f) the date of the
decision, and (g) the date notice of the decision was mailed to the protester.
The report shall contain, or have attached to it, a statement, signed by the
chairperson of the county board of equalization, describing the basis upon
which the board's decision was made. The report shall have attached to it a
copy of that portion of the property record file which substantiates
calculation of the protested value unless the county assessor certifies to the
county board of equalization that a copy is maintained in either electronic or
paper form in his or her office. One copy of the report, if prepared by the
county clerk, shall be given to the county assessor on or before August 2. The
county assessor shall have no authority to make a change in the assessment
rolls until there is in his or her possession a report which has been completed
in the manner specified in this section. If the county assessor deems a report
submitted by the county clerk incomplete, the county assessor shall return the
same to the county clerk for proper preparation.
     (6) On or before August 2, or on or before August 18 in a county that has
adopted a resolution to extend the deadline for hearing protests, the county
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clerk shall mail to the protester written notice of the board's decision. The
notice shall contain a statement advising the protester that a report of the
board's decision is available at the county clerk's or county assessor's
office, whichever is appropriate. If the protester is not an owner of the
property involved in the protest or a person authorized to protest on behalf of
the owner, the county clerk shall also mail written notice of the board's
decision to the owner of such property at the address to which the property tax
statements are mailed.
     Sec. 16. Section 77-1601, Revised Statutes Cumulative Supplement, 2024, is
amended to read:
     77-1601 (1) The county board of equalization shall each year, on or before
October 20, levy the necessary taxes for the current year if within the limit
of the law. The levy shall include an amount for operation of all functions of
county government and shall also include all levies necessary to fund tax
requests that are authorized as provided in sections 77-3442 to 77-3444,
including requests certified under section 77-1632 the Property Tax Request
Act.
     (2) On or before November 5, the county board of equalization upon its own
motion may act to correct a clerical error which has resulted in the
calculation of an incorrect levy by any entity with a tax request as provided
in sections 77-3442 to 77-3444, including requests certified under section
77-1632 the Property Tax Request Act. The county board of equalization shall
hold a public hearing to determine what adjustment to the levy is proper,
legal, or necessary. Notice shall be provided to the governing body of each
political subdivision affected by the error. Notice of the hearing as required
by section 84-1411 shall include the following: (a) The time and place of the
hearing, (b) the dollar amount at issue, and (c) a statement setting forth the
nature of the error.
     (3) Upon the conclusion of the hearing, the county board of equalization
shall issue a corrected levy if it determines that an error was made in the
original levy which warrants correction. The county board of equalization shall
then order (a) the county assessor, county clerk, and county treasurer to
revise assessment books, unit valuation ledgers, tax statements, and any other
tax records to reflect the correction made and (b) the recertification of the
information provided to the Property Tax Administrator pursuant to section
77-1613.01.
     Sec. 17. Section 77-1632, Revised Statutes Supplement, 2025, is amended to
read:
     77-1632 (1) For purposes of this section:
     (a) Political subdivision means a county, city, village, school district,
learning community, sanitary and improvement district, natural resources
district, or community college; and
     (b) Property tax request means the total amount of property taxes
requested to be raised for a political subdivision through the levy imposed
pursuant to section 77-1601.
     (2) (1) If the annual assessment of property would result in an increase
in the total property taxes levied by a political subdivision county, city,
village, school district, learning community, sanitary and improvement
district, natural resources district, educational service unit, or community
college, as determined using the previous year's rate of levy, such political
subdivision's property tax request for the current year shall be no more than
its property tax request in the prior year, and the political subdivision's
rate of levy for the current year shall be decreased accordingly when such rate
is set by the county board of equalization pursuant to section 77-1601. The
governing body of the political subdivision shall pass a resolution or
ordinance to set the amount of its property tax request after holding the
public hearing required in subsection (4) (3) of this section. If the governing
body of a political subdivision seeks to set its property tax request at an
amount that exceeds its property tax request in the prior year, it may do so,
subject to the limitations provided in the School District Property Tax
Limitation Act and the Property Tax Growth Limitation Act, after holding the
public hearing required in subsection (4) (3) of this section and by passing a
resolution or ordinance, by a two-thirds majority vote except for seven-member
boards which shall require a four-sevenths majority vote, that complies with
subsection (5) (4) of this section. If any county, city, or school district
seeks to increase its property tax request by more than the allowable growth
percentage, such political subdivision shall comply with the requirements of
section 77-1633 in lieu of the requirements in subsections (3) and (4) of this
section.
     (3) (2) If the annual assessment of property would result in no change or
a decrease in the total property taxes levied by a political subdivision
county, city, village, school district, learning community, sanitary and
improvement district, natural resources district, educational service unit, or
community college, as determined using the previous year's rate of levy, such
political subdivision's property tax request for the current year shall be no
more than its property tax request in the prior year, and the political
subdivision's rate of levy for the current year shall be adjusted accordingly
when such rate is set by the county board of equalization pursuant to section
77-1601. The governing body of the political subdivision shall pass a
resolution or ordinance to set the amount of its property tax request after
holding the public hearing required in subsection (4) (3) of this section. If
the governing body of a political subdivision seeks to set its property tax
request at an amount that exceeds its property tax request in the prior year,
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it may do so, subject to the limitations provided in the School District
Property Tax Limitation Act and the Property Tax Growth Limitation Act, after
holding the public hearing required in subsection (4) (3) of this section and
by passing a resolution or ordinance, by a two-thirds majority vote except for
seven-member boards which shall require a four-sevenths majority vote, that
complies with subsection (5) (4) of this section. If any county, city, or
school district seeks to increase its property tax request by more than the
allowable growth percentage, such political subdivision shall comply with the
requirements of section 77-1633 in lieu of the requirements in subsections (3)
and (4) of this section.
     (4) (3) The resolution or ordinance required under this section shall only
be passed after a special public hearing called for such purpose is held and
after notice is published in a newspaper of general circulation in the area of
the political subdivision at least four calendar days prior to the hearing. For
purposes of such notice, the four calendar days shall include the day of
publication but not the day of hearing. If the political subdivision's total
operating budget, not including reserves, does not exceed ten thousand dollars
per year or twenty thousand dollars per biennial period, the notice may be
posted at the governing body's principal headquarters. The hearing notice shall
contain the following information: The certified taxable valuation under
section 13-509 for the prior year, the certified taxable valuation under
section 13-509 for the current year, and the percentage increase or decrease in
such valuations from the prior year to the current year; the dollar amount of
the prior year's tax request and the property tax rate that was necessary to
fund that tax request; the property tax rate that would be necessary to fund
last year's tax request if applied to the current year's valuation; the
proposed dollar amount of the tax request for the current year and the property
tax rate that will be necessary to fund that tax request; the percentage
increase or decrease in the property tax rate from the prior year to the
current year; and the percentage increase or decrease in the total operating
budget from the prior year to the current year.
     (5) (4) Any resolution or ordinance setting a political subdivision's
property tax request under this section at an amount that exceeds the political
subdivision's property tax request in the prior year shall include, but not be
limited to, the following information:
     (a) The name of the political subdivision;
     (b) The amount of the property tax request;
     (c) The following statements:
     (i) The total assessed value of property differs from last year's total
assessed value by ..... percent;
     (ii) The tax rate which would levy the same amount of property taxes as
last year, when multiplied by the new total assessed value of property, would
be $..... per $100 of assessed value;
     (iii) The (name of political subdivision) proposes to adopt a property tax
request that will cause its tax rate to be $..... per $100 of assessed value;
and
     (iv) Based on the proposed property tax request and changes in other
revenue, the total operating budget of (name of political subdivision) will
(increase or decrease) last year's budget by ..... percent; and
     (d) The record vote of the governing body in passing such resolution or
ordinance.
     (6) (5) Any resolution or ordinance setting a property tax request under
this section shall be certified and forwarded to the county clerk on or before
October 15 of the year for which the tax request is to apply.
     Sec. 18. (1) Each county and each city or school district levying a tax
on property within a county shall participate in a joint public hearing. Each
such political subdivision shall designate one representative to attend the
joint public hearing on behalf of the political subdivision. If a political
subdivision includes area in more than one county, the political subdivision
shall be deemed to be within the county in which the political subdivision's
principal headquarters are located. At such hearing, there shall be no items on
the agenda other than discussion on each political subdivision's budget process
and preliminary information on relevant data that would impact the political
subdivision's budget in the current year.
     (2) At least one voting member of the governing body of each participating
political subdivision shall attend the joint public hearing. The county
assessor of the county in which the joint public hearing is being held shall
also attend the hearing. The presence of a quorum or the participation of
elected officials at the joint public hearing does not constitute a meeting as
defined by section 84-1409 of the Open Meetings Act.
     (3) The joint public hearing shall be held on or after July 1 and prior to
July 15 and before any of the participating political subdivisions file their
adopted budget statement pursuant to section 13-508.
     (4) The joint public hearing shall be held after 6 p.m. local time on the
relevant date.
     (5) The joint public hearing shall be organized by the county clerk or his
or her designee. At the joint public hearing, the designated representative of
each political subdivision shall give a brief presentation on the budget
process, how the budget affects the property tax request, information about the
prior year's budget and property tax request, and any preliminary information
about factors that may affect the current year's budget as may be known to the
political subdivision.
     (6) Any member of the public shall be allowed to speak at the joint public
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hearing and shall be given a reasonable amount of time to do so.
     (7)(a) After completion of the joint public hearing, the county clerk, or
his or her designee, shall prepare a report which shall include:
     (i) The name of each political subdivision that participated in the joint
public hearing;
     (ii) The names of the designated representatives of the political
subdivisions participating in the joint public hearing;
     (iii) The name and address of each individual who spoke at the joint
public hearing, unless the address requirement is waived to protect the
security of the individual, and the name of any organization represented by
each such individual; and
     (iv) The number of individuals who signed in to attend the joint public
hearing.
     (b) Such report shall be delivered to the political subdivisions
participating in the joint public hearing within ten days after such hearing.
     Sec. 19. Section 77-1776, Revised Statutes Cumulative Supplement, 2024, is
amended to read:
     77-1776 Any political subdivision which has received proceeds from a levy
imposed on all taxable property within an entire county which is in excess of
that requested by the political subdivision under section 77-1632 the Property
Tax Request Act as a result of a clerical error or mistake shall, in the fiscal
year following receipt, return the excess tax collections, net of the
collection fee, to the county. By July 31 of the fiscal year following the
receipt of any excess tax collections, the county treasurer shall certify to
the political subdivision the amount to be returned. For fiscal years beginning
prior to July 1, 2025, such excess tax collections shall be restricted funds in
the budget of the county that receives the funds under section 13-518.
     Sec. 20. Section 77-2716, Revised Statutes Supplement, 2025, is amended to
read:
     77-2716 (1) The following adjustments to federal adjusted gross income or,
for corporations and fiduciaries, federal taxable income shall be made for
interest or dividends received:
     (a)(i) There shall be subtracted interest or dividends received by the
owner of obligations of the United States and its territories and possessions
or of any authority, commission, or instrumentality of the United States to the
extent includable in gross income for federal income tax purposes but exempt
from state income taxes under the laws of the United States; and
     (ii) There shall be subtracted interest received by the owner of
obligations of the State of Nebraska or its political subdivisions or
authorities which are Build America Bonds to the extent includable in gross
income for federal income tax purposes;
     (b) There shall be subtracted that portion of the total dividends and
other income received from a regulated investment company which is attributable
to obligations described in subdivision (a) of this subsection as reported to
the recipient by the regulated investment company;
     (c) There shall be added interest or dividends received by the owner of
obligations of the District of Columbia, other states of the United States, or
their political subdivisions, authorities, commissions, or instrumentalities to
the extent excluded in the computation of gross income for federal income tax
purposes except that such interest or dividends shall not be added if received
by a corporation which is a regulated investment company;
     (d) There shall be added that portion of the total dividends and other
income received from a regulated investment company which is attributable to
obligations described in subdivision (c) of this subsection and excluded for
federal income tax purposes as reported to the recipient by the regulated
investment company; and
     (e)(i) Any amount subtracted under this subsection shall be reduced by any
interest on indebtedness incurred to carry the obligations or securities
described in this subsection or the investment in the regulated investment
company and by any expenses incurred in the production of interest or dividend
income described in this subsection to the extent that such expenses, including
amortizable bond premiums, are deductible in determining federal taxable
income.
     (ii) Any amount added under this subsection shall be reduced by any
expenses incurred in the production of such income to the extent disallowed in
the computation of federal taxable income.
     (2) There shall be allowed a net operating loss derived from or connected
with Nebraska sources computed under rules and regulations adopted and
promulgated by the Tax Commissioner consistent, to the extent possible under
the Nebraska Revenue Act of 1967, with the laws of the United States. For a
resident individual, estate, or trust, the net operating loss computed on the
federal income tax return shall be adjusted by the modifications contained in
this section. For a nonresident individual, estate, or trust or for a partial-
year resident individual, the net operating loss computed on the federal return
shall be adjusted by the modifications contained in this section and any
carryovers or carrybacks shall be limited to the portion of the loss derived
from or connected with Nebraska sources.
     (3) There shall be subtracted from federal adjusted gross income for all
taxable years beginning on or after January 1, 1987, the amount of any state
income tax refund to the extent such refund was deducted under the Internal
Revenue Code, was not allowed in the computation of the tax due under the
Nebraska Revenue Act of 1967, and is included in federal adjusted gross income.
     (4) Federal adjusted gross income, or, for a fiduciary, federal taxable
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income shall be modified to exclude the portion of the income or loss received
from a small business corporation with an election in effect under subchapter S
of the Internal Revenue Code or from a limited liability company organized
pursuant to the Nebraska Uniform Limited Liability Company Act that is not
derived from or connected with Nebraska sources as determined in section
77-2734.01.
     (5) There shall be subtracted from federal adjusted gross income or, for
corporations and fiduciaries, federal taxable income dividends received or
deemed to be received from corporations which are not subject to the Internal
Revenue Code.
     (6) There shall be subtracted from federal taxable income a portion of the
income earned by a corporation subject to the Internal Revenue Code of 1986
that is actually taxed by a foreign country or one of its political
subdivisions at a rate in excess of the maximum federal tax rate for
corporations. The taxpayer may make the computation for each foreign country or
for groups of foreign countries. The portion of the taxes that may be deducted
shall be computed in the following manner:
     (a) The amount of federal taxable income from operations within a foreign
taxing jurisdiction shall be reduced by the amount of taxes actually paid to
the foreign jurisdiction that are not deductible solely because the foreign tax
credit was elected on the federal income tax return;
     (b) The amount of after-tax income shall be divided by one minus the
maximum tax rate for corporations in the Internal Revenue Code; and
     (c) The result of the calculation in subdivision (b) of this subsection
shall be subtracted from the amount of federal taxable income used in
subdivision (a) of this subsection. The result of such calculation, if greater
than zero, shall be subtracted from federal taxable income.
     (7) Federal adjusted gross income shall be modified to exclude any amount
repaid by the taxpayer for which a reduction in federal tax is allowed under
section 1341(a)(5) of the Internal Revenue Code.
     (8)(a) Federal adjusted gross income or, for corporations and fiduciaries,
federal taxable income shall be reduced, to the extent included, by income from
interest, earnings, and state contributions received from the Nebraska
educational savings plan trust as provided in sections 77-1415 to 77-1430 and
any account established under the achieving a better life experience program as
provided in sections 77-1401 to 77-1409.
     (b) Federal adjusted gross income or, for corporations and fiduciaries,
federal taxable income shall be reduced by any contributions as a participant
in the Nebraska educational savings plan trust, any contributions to an account
established under the achieving a better life experience program made for the
benefit of a beneficiary as provided in sections 77-1401 to 77-1409, or any
contributions to the Give to Enable Support Cash Fund as provided in the Give
to Enable Support Act, to the extent not deducted for federal income tax
purposes, but not to exceed five thousand dollars per married filing separate
return or ten thousand dollars for any other return. With respect to a
qualified rollover within the meaning of section 529 of the Internal Revenue
Code from another state's plan, any interest, earnings, and state contributions
received from the other state's educational savings plan which is qualified
under section 529 of the code shall qualify for the reduction provided in this
subdivision. For contributions by a custodian of a custodial account including
rollovers from another custodial account, the reduction shall only apply to
funds added to the custodial account after January 1, 2014.
     (c) For taxable years beginning or deemed to begin on or after January 1,
2021, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income shall be reduced, to the extent included in the adjusted gross
income of an individual, by the amount of any contribution made by the
individual's employer into an account under the Nebraska educational savings
plan trust owned by the individual, not to exceed five thousand dollars per
married filing separate return or ten thousand dollars for any other return.
     (d) Federal adjusted gross income or, for corporations and fiduciaries,
federal taxable income shall be increased by:
     (i) The amount resulting from the cancellation of a participation
agreement refunded to the taxpayer as a participant in the Nebraska educational
savings plan trust to the extent previously deducted under subdivision (8)(b)
of this section; and
     (ii) The amount of any withdrawals by the owner of an account established
under the achieving a better life experience program as provided in sections
77-1401 to 77-1409 for nonqualified expenses to the extent previously deducted
under subdivision (8)(b) of this section.
     (9)(a) For income tax returns filed after September 10, 2001, for taxable
years beginning or deemed to begin before January 1, 2006, under the Internal
Revenue Code of 1986, as amended, federal adjusted gross income or, for
corporations and fiduciaries, federal taxable income shall be increased by
eighty-five percent of any amount of any federal bonus depreciation received
under the federal Job Creation and Worker Assistance Act of 2002 or the federal
Jobs and Growth Tax Act of 2003, under section 168(k) or section 1400L of the
Internal Revenue Code of 1986, as amended, for assets placed in service after
September 10, 2001, and before December 31, 2005.
     (b) For a partnership, limited liability company, cooperative, including
any cooperative exempt from income taxes under section 521 of the Internal
Revenue Code of 1986, as amended, limited cooperative association, subchapter S
corporation, or joint venture, the increase shall be distributed to the
partners, members, shareholders, patrons, or beneficiaries in the same manner
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as income is distributed for use against their income tax liabilities.
     (c) For a corporation with a unitary business having activity both inside
and outside the state, the increase shall be apportioned to Nebraska in the
same manner as income is apportioned to the state by section 77-2734.05.
     (d) The amount of bonus depreciation added to federal adjusted gross
income or, for corporations and fiduciaries, federal taxable income by this
subsection shall be subtracted in a later taxable year. Twenty percent of the
total amount of bonus depreciation added back by this subsection for tax years
beginning or deemed to begin before January 1, 2003, under the Internal Revenue
Code of 1986, as amended, may be subtracted in the first taxable year beginning
or deemed to begin on or after January 1, 2005, under the Internal Revenue Code
of 1986, as amended, and twenty percent in each of the next four following
taxable years. Twenty percent of the total amount of bonus depreciation added
back by this subsection for tax years beginning or deemed to begin on or after
January 1, 2003, may be subtracted in the first taxable year beginning or
deemed to begin on or after January 1, 2006, under the Internal Revenue Code of
1986, as amended, and twenty percent in each of the next four following taxable
years.
     (10) For taxable years beginning or deemed to begin on or after January 1,
2003, and before January 1, 2006, under the Internal Revenue Code of 1986, as
amended, federal adjusted gross income or, for corporations and fiduciaries,
federal taxable income shall be increased by the amount of any capital
investment that is expensed under section 179 of the Internal Revenue Code of
1986, as amended, that is in excess of twenty-five thousand dollars that is
allowed under the federal Jobs and Growth Tax Act of 2003. Twenty percent of
the total amount of expensing added back by this subsection for tax years
beginning or deemed to begin on or after January 1, 2003, may be subtracted in
the first taxable year beginning or deemed to begin on or after January 1,
2006, under the Internal Revenue Code of 1986, as amended, and twenty percent
in each of the next four following tax years.
     (11)(a) For taxable years beginning or deemed to begin before January 1,
2018, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income shall be reduced by contributions, up to two thousand dollars per
married filing jointly return or one thousand dollars for any other return, and
any investment earnings made as a participant in the Nebraska long-term care
savings plan under the Long-Term Care Savings Plan Act, to the extent not
deducted for federal income tax purposes.
     (b) For taxable years beginning or deemed to begin before January 1, 2018,
under the Internal Revenue Code of 1986, as amended, federal adjusted gross
income shall be increased by the withdrawals made as a participant in the
Nebraska long-term care savings plan under the act by a person who is not a
qualified individual or for any reason other than transfer of funds to a
spouse, long-term care expenses, long-term care insurance premiums, or death of
the participant, including withdrawals made by reason of cancellation of the
participation agreement, to the extent previously deducted as a contribution or
as investment earnings.
     (12) There shall be added to federal adjusted gross income for
individuals, estates, and trusts any amount taken as a credit for franchise tax
paid by a financial institution under sections 77-3801 to 77-3807 as allowed by
subsection (5) of section 77-2715.07.
     (13)(a) For taxable years beginning or deemed to begin on or after January
1, 2015, and before January 1, 2024, under the Internal Revenue Code of 1986,
as amended, federal adjusted gross income shall be reduced by the amount
received as benefits under the federal Social Security Act which are included
in the federal adjusted gross income if:
     (i) For taxpayers filing a married filing joint return, federal adjusted
gross income is fifty-eight thousand dollars or less; or
     (ii) For taxpayers filing any other return, federal adjusted gross income
is forty-three thousand dollars or less.
     (b) For taxable years beginning or deemed to begin on or after January 1,
2020, and before January 1, 2024, under the Internal Revenue Code of 1986, as
amended, the Tax Commissioner shall adjust the dollar amounts provided in
subdivisions (13)(a)(i) and (ii) of this section by the same percentage used to
adjust individual income tax brackets under subsection (3) of section
77-2715.03.
     (c) For taxable years beginning or deemed to begin on or after January 1,
2021, and before January 1, 2024, under the Internal Revenue Code of 1986, as
amended, a taxpayer may claim the reduction to federal adjusted gross income
allowed under this subsection or the reduction to federal adjusted gross income
allowed under subsection (14) of this section, whichever provides the greater
reduction.
     (14)(a) For taxable years beginning or deemed to begin on or after January
1, 2021, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income shall be reduced by a percentage of the social security benefits
that are received and included in federal adjusted gross income. The pertinent
percentage shall be:
     (i) Five percent for taxable years beginning or deemed to begin on or
after January 1, 2021, and before January 1, 2022, under the Internal Revenue
Code of 1986, as amended;
     (ii) Forty percent for taxable years beginning or deemed to begin on or
after January 1, 2022, and before January 1, 2023, under the Internal Revenue
Code of 1986, as amended;
     (iii) Sixty percent for taxable years beginning or deemed to begin on or
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after January 1, 2023, and before January 1, 2024, under the Internal Revenue
Code of 1986, as amended; and
     (iv) One hundred percent for taxable years beginning or deemed to begin on
or after January 1, 2024, under the Internal Revenue Code of 1986, as amended.
     (b) For purposes of this subsection, social security benefits means
benefits received under the federal Social Security Act.
     (c) For taxable years beginning or deemed to begin on or after January 1,
2021, and before January 1, 2024, under the Internal Revenue Code of 1986, as
amended, a taxpayer may claim the reduction to federal adjusted gross income
allowed under this subsection or the reduction to federal adjusted gross income
allowed under subsection (13) of this section, whichever provides the greater
reduction.
     (15)(a) For taxable years beginning or deemed to begin on or after January
1, 2015, and before January 1, 2022, under the Internal Revenue Code of 1986,
as amended, an individual may make a one-time election within two calendar
years after the date of his or her retirement from the military to exclude
income received as a military retirement benefit by the individual to the
extent included in federal adjusted gross income and as provided in this
subdivision. The individual may elect to exclude forty percent of his or her
military retirement benefit income for seven consecutive taxable years
beginning with the year in which the election is made or may elect to exclude
fifteen percent of his or her military retirement benefit income for all
taxable years beginning with the year in which he or she turns sixty-seven
years of age.
     (b) For taxable years beginning or deemed to begin on or after January 1,
2022, under the Internal Revenue Code of 1986, as amended, an individual may
exclude one hundred percent of the military retirement benefit income received
by such individual to the extent included in federal adjusted gross income.
     (c) For purposes of this subsection, military retirement benefit means
retirement benefits that are periodic payments attributable to service in the
uniformed services of the United States for personal services performed by an
individual prior to his or her retirement. The term includes retirement
benefits described in this subdivision that are reported to the individual on
either:
     (i) An Internal Revenue Service Form 1099-R received from the United
States Department of Defense; or
     (ii) An Internal Revenue Service Form 1099-R received from the United
States Office of Personnel Management.
     (16) For taxable years beginning or deemed to begin on or after January 1,
2021, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income shall be reduced by the amount received as a Segal AmeriCorps
Education Award, to the extent such amount is included in federal adjusted
gross income.
     (17) For taxable years beginning or deemed to begin on or after January 1,
2022, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income shall be reduced by the amount received by or on behalf of a
firefighter for cancer benefits under the Firefighter Cancer Benefits Act to
the extent included in federal adjusted gross income.
     (18) There shall be subtracted from the federal adjusted gross income of
individuals any amount received by the individual as student loan repayment
assistance under the Teach in Nebraska Today Act, to the extent such amount is
included in federal adjusted gross income.
     (19) For taxable years beginning or deemed to begin on or after January 1,
2023, under the Internal Revenue Code of 1986, as amended, a retired individual
who was employed full time as a firefighter or certified law enforcement
officer for at least twenty years and who is at least sixty years of age as of
the end of the taxable year may reduce his or her federal adjusted gross income
by the amount of health insurance premiums paid by such individual during the
taxable year, to the extent such premiums were not already deducted in
determining the individual's federal adjusted gross income.
     (20) For taxable years beginning or deemed to begin on or after January 1,
2024, under the Internal Revenue Code of 1986, as amended, an individual may
reduce his or her federal adjusted gross income by the amounts received as
annuities under the Civil Service Retirement System which were earned for being
employed by the federal government, to the extent such amounts are included in
federal adjusted gross income.
     (21) For taxable years beginning or deemed to begin on or after January 1,
2025, under the Internal Revenue Code of 1986, as amended, an individual who is
a member of the Nebraska National Guard may exclude one hundred percent of the
income received from any of the following sources to the extent such income is
included in the individual's federal adjusted gross income:
     (a) Serving in a 32 U.S.C. duty status such as members attending drills,
annual training, and military schools and members who are serving in a 32
U.S.C. active guard reserve or active duty for operational support duty status;
     (b) Employment as a 32 U.S.C. federal dual-status technician with the
Nebraska National Guard; or
     (c) Serving in a state active duty status.
     (22)(a) For taxable years beginning or deemed to begin on or after January
1, 2024, under the Internal Revenue Code of 1986, as amended, an individual may
reduce his or her federal adjusted gross income by the amount of interest and
principal balance of medical debt discharged under the Medical Debt Relief Act,
to the extent included in such individual's federal adjusted gross income.
     (b) For taxable years beginning or deemed to begin on or after January 1,
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2024, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income or, for corporations and fiduciaries, federal taxable income shall
be reduced by the amount of contributions made to the Medical Debt Relief Fund,
to the extent not deducted for federal income tax purposes.
     (23) For taxable years beginning or deemed to begin on or after January 1,
2025, under the Internal Revenue Code of 1986, as amended, an individual who is
a qualifying employee as defined in section 77-3108 may reduce his or her
federal adjusted gross income by the amount allowed under section 77-3111.
     (24) For taxable years beginning or deemed to begin on or after January 1,
2026, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income or, for corporations and fiduciaries, federal taxable income shall
be reduced by the amounts allowed to be deducted pursuant to section 77-27,242.
     (25) There shall be added to federal adjusted gross income or, for
corporations and fiduciaries, federal taxable income for all taxable years
beginning on or after January 1, 2025, the amount of any net capital loss that
is derived from the sale or exchange of gold or silver bullion to the extent
such loss is included in federal adjusted gross income except that such loss
shall not be added if the loss is derived from the sale of bullion as a taxable
distribution from any retirement plan account that holds gold or silver
bullion. For the purposes of this subsection, bullion has the same meaning as
in section 77-2704.66.
     (26) There shall be subtracted from federal adjusted gross income or, for
corporations and fiduciaries, federal taxable income for all taxable years
beginning on or after January 1, 2025, the amount of any net capital gain that
is derived from the sale or exchange of gold or silver bullion to the extent
such gain is included in federal adjusted gross income except that such gain
shall not be subtracted if the gain is derived from the sale of bullion as a
taxable distribution from any retirement plan account that holds gold or silver
bullion. For the purposes of this subsection, bullion has the same meaning as
in section 77-2704.66.
     (27)(a) For taxable years beginning or deemed to begin on or after January
1, 2027, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income shall be reduced by the amount contributed to a first-time home
buyer savings account under the First-Time Home Buyer Savings Account Act not
to exceed five thousand dollars for individual taxpayers or ten thousand
dollars for married filing jointly taxpayers and, to the extent included, by an
amount equal to any interest and other income earned during the taxable year on
the investment of money in a first-time home buyer savings account. Any
subtraction taken under this subdivision is subject to recapture under
subdivision (27)(b) of this section.
     (b) For taxable years beginning or deemed to begin on or after January 1,
2027, under the Internal Revenue Code of 1986, as amended, federal adjusted
gross income shall be increased by any amount recaptured for the taxable year
pursuant to section 5 of this act.
     Sec. 21. Section 77-3506, Revised Statutes Supplement, 2025, is amended to
read:
     77-3506 (1) All homesteads in this state shall be assessed for taxation
the same as other property, except that there shall be exempt from taxation, on
any homestead described in subsection (2) of this section, one hundred percent
of the exempt amount.
     (2) The exemption described in subsection (1) of this section shall apply
to homesteads of:
     (a) A veteran who was discharged or otherwise separated with a
characterization of honorable or general (under honorable conditions), who is
drawing compensation from the United States Department of Veterans Affairs
because of (i) one hundred percent service-connected permanent disability or
(ii) assignment of total disability rating for compensation pursuant to 38
C.F.R. 4.16, and who is not eligible for total exemption under sections 77-3526
to 77-3528;
     (b) An unremarried surviving spouse of a veteran described in subdivision
(2)(a) of this section or a surviving spouse of such a veteran who remarries
after attaining the age of fifty-seven years;
     (c) A veteran who was discharged or otherwise separated with a
characterization of honorable or general (under honorable conditions), who is
drawing compensation from the United States Department of Veterans Affairs
because of one hundred percent service-connected temporary disability, and who
is not eligible for total exemption under sections 77-3526 to 77-3528, an
unremarried surviving spouse of such a veteran, or a surviving spouse of such a
veteran who remarries after attaining the age of fifty-seven years;
     (d) An unremarried surviving spouse of any veteran, including a veteran
other than a veteran described in section 80-401.01, who was discharged or
otherwise separated with a characterization of honorable or general (under
honorable conditions) and who died because of a service-connected disability or
a surviving spouse of such a veteran who remarries after attaining the age of
fifty-seven years;
     (e) An unremarried surviving spouse of a serviceman or servicewoman,
including a veteran other than a veteran described in section 80-401.01, whose
death while on active duty was service-connected or a surviving spouse of such
a serviceman or servicewoman who remarries after attaining the age of fifty-
seven years; and
     (f) An unremarried surviving spouse of a serviceman or servicewoman who
died while on active duty during the periods described in section 80-401.01 or
a surviving spouse of such a serviceman or servicewoman who remarries after
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attaining the age of fifty-seven years.
     (3) Application for exemption under subdivision (2)(a), (b), (d), (e), or
(f) of this section shall not be required in any every subsequent year evenly
divisible by five and shall include certification of the status described in
subdivision (2)(a) of this section from the United States Department of
Veterans Affairs. Application for exemption under subdivision (2)(c) (2)(b),
(c), (d), (e), or (f) of this section shall be required annually and shall
include certification of the status described in subdivision (2)(c) (2)(b),
(c), (d), (e), or (f) of this section from the United States Department of
Veterans Affairs , except that such certification of status shall only be
required in every subsequent year evenly divisible by five.
     (4)(a) If an unremarried surviving spouse who has been granted a homestead
exemption under subdivision (2)(b), (d), (e), or (f) of this section remarries
before attaining the age of fifty-seven years, such spouse shall lose the
homestead exemption. The surviving spouse shall notify the county assessor of
such remarriage within thirty days after the remarriage.
     (b) If an unremarried surviving spouse who has applied for a homestead
exemption under subdivision (2)(b), (d), (e), or (f) of this section remarries
on or before August 15 of the year of application and before attaining the age
of fifty-seven years, such spouse shall be ineligible for the homestead
exemption. The surviving spouse shall notify the county assessor of such
remarriage within thirty days after the remarriage.
     Sec. 22. Section 77-3510, Reissue Revised Statutes of Nebraska, is amended
to read:
     77-3510 On or before February 1 of each year, the Tax Commissioner shall
prescribe forms to be used by all claimants for homestead exemption or for
transfer of homestead exemption. Such forms shall contain provisions for the
showing of all information which the Tax Commissioner may deem necessary to (1)
enable the county officials and the Tax Commissioner to determine whether each
claim for exemption under sections 77-3506, 77-3507, and 77-3508 should be
allowed and (2) enable the county assessor to determine whether each claim for
transfer of homestead exemption pursuant to section 77-3509.01 should be
allowed. It shall be the duty of the county assessor of each county in this
state to furnish such forms, upon request, to each person desiring to make
application for homestead exemption or for transfer of homestead exemption. The
forms so prescribed shall be used uniformly throughout the state, and no
application for exemption or for transfer of homestead exemption shall be
allowed unless the applicant uses the prescribed form in making an application.
The forms shall require an affirmation for any applicant seeking an exemption
under subdivision (2)(b), (d), (e), or (f) of section 77-3506 as prescribed by
the Tax Commissioner that such applicant is aware that a surviving spouse is
required to notify the county assessor of any remarriage that causes the
surviving spouse to be ineligible for the exemption pursuant to subsection (4)
of section 77-3506. The forms shall require the attachment of an income
statement for any applicant seeking an exemption under section 77-3507 or
77-3508 as prescribed by the Tax Commissioner fully accounting for all
household income. The Tax Commissioner shall provide to each county assessor
claim forms and address lists of applicants from the prior year in the manner
approved by the Tax Commissioner. The application and information contained on
any attachments to the application shall be confidential and available to tax
officials only.
     Sec. 23. Section 77-3512, Revised Statutes Cumulative Supplement, 2024, is
amended to read:
     77-3512 (1) It shall be the duty of each owner who wants a homestead
exemption under section 77-3506, 77-3507, or 77-3508 to file an application
therefor with the county assessor of the county in which the homestead is
located after February 1 and on or before June 30 of each year, except that:
     (a) The county board of the county in which the homestead is located may,
by majority vote, extend the deadline for an applicant to on or before July 20.
An extension shall not be granted to an applicant who received an extension in
the immediately preceding year;
     (b) An owner may file a late application pursuant to section 77-3514.01 if
he or she includes documentation of a medical condition which impaired the
owner's ability to file the application in a timely manner;
     (c) An owner may file a late application pursuant to section 77-3514.01 if
he or she includes a copy of the death certificate of a spouse who died during
the year for which the exemption is requested; and
     (d) A veteran or surviving spouse of a veteran, serviceman, or
servicewoman qualifying for a homestead exemption under subdivision (2)(a),
(b), (d), (e), or (f) of section 77-3506 shall not only be required to file an
application in any every subsequent year. evenly divisible by five; and
     (e) If a veteran who has been granted a homestead exemption under
subdivision (2)(a) of section 77-3506 dies during the five-year exemption
period, the surviving spouse of such veteran shall continue to receive such
exemption for the remainder of the five-year exemption period. After the
expiration of the five-year exemption period, the surviving spouse shall be
required to file for an exemption under subdivision (2)(b) of section 77-3506
on an annual basis.
     (2) Failure to file an application as required in subsection (1) of this
section shall constitute a waiver of the exemption for the year in which the
failure occurred.
     Sec. 24. Section 2, Legislative Bill 901, One Hundred Ninth Legislature,
Second Session, 2026, is amended to read:
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     Sec. 2. (1) For taxable years beginning or deemed to begin on or after
January 1, 2027, under the Internal Revenue Code of 1986, as amended, there
shall be allowed refundable credits against the income tax imposed by the
Nebraska Revenue Act of 1967 as follows:
     (a) Two hundred forty thousand dollars of tax credits to be distributed
equally among qualifying domestic violence and sexual assault programs run by
tribal governments;
     (b) One hundred fifty thousand dollars of tax credits to be distributed to
a statewide coalition representing nonprofit organizations that have an
affiliation agreement with the Department of Health and Human Services to
provide services to victims of domestic abuse under the Protection from
Domestic Abuse Act;
     (c) One million forty-four thousand dollars of tax credits to be
distributed equally to the nonprofit organizations entities described in
subdivision subdivisions (a) and (b) of this subsection and any other nonprofit
organizations that operate a shelter for victims of domestic violence or human
trafficking; and
     (d) One million five hundred sixty-six thousand dollars of tax credits to
be distributed to the nonprofit organizations entities described in subdivision
subdivisions (a) and (b) of this subsection and any other nonprofit
organizations that operate a shelter for victims of domestic violence or human
trafficking as follows:
     (i) One million two hundred fifty-two thousand eight hundred dollars of
tax credits to be distributed based on the population of the program or service
area as shown by the latest federal decennial census or as determined by the
department if such census data is not available; and
     (ii) Three hundred thirteen thousand two hundred dollars of tax credits to
be distributed based on the square miles of the program or service area.
     (2) The department shall distribute all of the credits allowed under the
Domestic Violence and Human Trafficking Service Providers Tax Credit Act each
calendar year.
     (3) For purposes of this section:
     (a) Department means the Department of Revenue;
     (b) Nonprofit organization means an organization organized under section
501(c)(3) of the Internal Revenue Code of 1986, as amended; and
     (c) Tribal has the same meaning as in section 71-914.02.
     Sec. 25.   Sections 14, 15, 16, 17, 18, 19, 24, 28, and 29 of this act
become operative on January 1, 2027. Sections 1, 2, 3, 4, 5, 6, 7, 8, 13, 20,
21, 22, 23, and 27 of this act become operative three calendar months after the
adjournment of this legislative session. The other sections of this act become
operative on their effective date.
     Sec. 26. Original section 13-3105, Reissue Revised Statutes of Nebraska,
section 13-3108, Revised Statutes Cumulative Supplement, 2024, and sections
13-3103 and 13-3106, Revised Statutes Supplement, 2025, are repealed.
     Sec. 27. Original section 77-3510, Reissue Revised Statutes of Nebraska,
section 77-3512, Revised Statutes Cumulative Supplement, 2024, and sections
13-3403, 77-2716, and 77-3506, Revised Statutes Supplement, 2025, are repealed.
     Sec. 28. Original section 77-1315, Reissue Revised Statutes of Nebraska,
sections 77-1502, 77-1601, and 77-1776, Revised Statutes Cumulative Supplement,
2024, section 77-1632, Revised Statutes Supplement, 2025, and section 2,
Legislative Bill 901, One Hundred Ninth Legislature, Second Session, 2026, are
repealed.
     Sec. 29. The following sections are outright repealed: Sections 77-1630
and 77-1634, Revised Statutes Cumulative Supplement, 2024, section 77-1631,
Revised Statutes Supplement, 2025, and section 77-1633, Revised Statutes
Supplement, 2025, as amended by section 1, Legislative Bill 384, One Hundred
Ninth Legislature, Second Session, 2026.
     Sec. 30. Since an emergency exists, this act takes effect when passed and
approved according to law.
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