LB 931

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                           LEGISLATURE OF NEBRASKA
                        ONE HUNDRED NINTH LEGISLATURE
                               SECOND SESSION
                  LEGISLATIVE BILL 931
   Introduced by Cavanaugh, J., 9.
   Read first time January 09, 2026
   Committee: Revenue
1   A BILL FOR AN ACT relating to revenue and taxation; to amend section
277-2715.07, Revised Statutes Supplement, 2025; to provide an income
3tax credit related to premium payments for a qualified health plan;
4and to repeal the original section.
5    Be it enacted by the people of the State of Nebraska,
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1Section 1. Section 77-2715.07, Revised Statutes Supplement, 2025, is
2   amended to read:
377-2715.07        (1)     There    shall      be   allowed   to   qualified       resident
4    individuals as a nonrefundable credit against the income tax imposed by
5    the Nebraska Revenue Act of 1967:
6(a) A credit equal to the federal credit allowed under section 22 of
7    the Internal Revenue Code; and
8(b) A credit for taxes paid to another state as provided in section
9    77-2730.
10(2) There shall be allowed to qualified resident individuals against
11    the income tax imposed by the Nebraska Revenue Act of 1967:
12(a) For returns filed reporting federal adjusted gross incomes of
13    greater than twenty-nine thousand dollars, a nonrefundable credit equal
14    to twenty-five percent of the federal credit allowed under section 21 of
15    the Internal Revenue Code of 1986, as amended, except that for taxable
16    years beginning or deemed to begin on or after January 1, 2015, such
17    nonrefundable credit shall be allowed only if the individual would have
18   received the federal credit allowed under section 21 of the code after
19    adding back in any carryforward of a net operating loss that was deducted
20    pursuant   to    such      section    in   determining     eligibility   for    the    federal
21    credit;
22(b) For returns filed reporting federal adjusted gross income of
23    twenty-nine thousand dollars or less, a refundable credit equal to a
24    percentage      of   the    federal    credit     allowable   under   section    21    of   the
25    Internal Revenue Code of 1986, as amended, whether or not the federal
26    credit was limited by the federal tax liability. The percentage of the
27    federal credit shall be one hundred percent for incomes not greater than
28    twenty-two thousand dollars, and the percentage shall be reduced by ten
29    percent for each one thousand dollars, or fraction thereof, by which the
30   reported     federal       adjusted    gross      income   exceeds    twenty-two      thousand
31    dollars, except that for taxable years beginning or deemed to begin on or
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1    after January 1, 2015, such refundable credit shall be allowed only if
2    the    individual    would     have   received     the   federal        credit    allowed    under
3    section 21 of the code after adding back in any carryforward of a net
4    operating loss that was deducted pursuant to such section in determining
5    eligibility for the federal credit;
6(c)   A    refundable    credit     as    provided     in    section      77-5209.01     for
7    individuals who qualify for an income tax credit as a qualified beginning
8    farmer or livestock producer under the Beginning Farmer Tax Credit Act
9    for all taxable years beginning or deemed to begin on or after January 1,
10    2006, under the Internal Revenue Code of 1986, as amended;
11(d) A refundable credit for individuals who qualify for an income
12    tax credit under the Adoption Tax Credit Act, the Angel Investment Tax
13    Credit Act, the Nebraska Advantage Microenterprise Tax Credit Act, the
14    Nebraska Advantage Research and Development Act, the Reverse Osmosis
15    System Tax Credit Act, or the Volunteer Emergency Responders Incentive
16    Act;
17(e) A refundable credit equal to ten percent of the federal credit
18    allowed      under   section    32    of   the    Internal    Revenue      Code    of   1986,    as
19    amended, except that for taxable years beginning or deemed to begin on or
20    after January 1, 2015, such refundable credit shall be allowed only if
21    the    individual    would     have   received     the   federal        credit    allowed    under
22    section 32 of the code after adding back in any carryforward of a net
23    operating loss that was deducted pursuant to such section in determining
24    eligibility for the federal credit; and
25(f)    A   refundable     credit     as     provided        in   section    77-7203      for
26    individuals who qualify for an income tax credit under the Child Care Tax
27    Credit Act for all taxable years beginning or deemed to begin on or after
28    January 1, 2024, under the Internal Revenue Code of 1986, as amended.
29(3) There shall be allowed to all individuals as a nonrefundable
30    credit against the income tax imposed by the Nebraska Revenue Act of
31    1967:
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1(a)   A   credit      for       personal        exemptions    allowed     under   section
2   77-2716.01;
3(b) A credit for (i) contributions to programs or projects certified
4   for tax credit status as provided in the Creating High Impact Economic
5   Futures Act and (ii) contributions to certified community betterment
6   programs as provided in the Community Development Assistance Act. Each
7    partner, each shareholder of an electing subchapter S corporation, each
8    beneficiary of an estate or trust, or each member of a limited liability
9    company shall report his or her share of the credit in the same manner
10   and    proportion    as   he      or    she   reports       the   partnership,    subchapter    S
11   corporation, estate, trust, or limited liability company income;
12(c) A credit for investment in a biodiesel facility as provided in
13   section 77-27,236;
14(d) A credit as provided in the New Markets Job Growth Investment
15    Act;
16(e) A credit as provided in the Nebraska Job Creation and Mainstreet
17   Revitalization Act;
18(f) A credit to employers as provided in sections 77-27,238 and
19    77-27,240;
20(g) A credit as provided in the Affordable Housing Tax Credit Act;
21(h)   A   credit      to        grocery    store      retailers,      restaurants,     and
22   agricultural producers as provided in section 77-27,241;
23(i) A credit as provided in the Sustainable Aviation Fuel Tax Credit
24    Act;
25(j)   A   credit      as        provided        in   the   Nebraska     Shortline      Rail
26   Modernization Act;
27(k) A credit as provided in the Nebraska Pregnancy Help Act; and
28(l) A credit as provided in the Caregiver Tax Credit Act.
29(4)   There   shall     be      allowed    as    a   credit   against   the   income   tax
30   imposed by the Nebraska Revenue Act of 1967:
31(a) A credit to all resident estates and trusts for taxes paid to
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1    another state as provided in section 77-2730;
2(b) A credit to all estates and trusts for (i) contributions to
3    programs or projects certified for tax credit status as provided in the
4   Creating   High    Impact   Economic   Futures      Act   and   (ii)    contributions     to
5    certified community betterment programs as provided in the Community
6    Development Assistance Act; and
7(c) A refundable credit for individuals who qualify for an income
8   tax credit as an owner of agricultural assets under the Beginning Farmer
9    Tax Credit Act for all taxable years beginning or deemed to begin on or
10    after January 1, 2009, under the Internal Revenue Code of 1986, as
11    amended. The credit allowed for each partner, shareholder, member, or
12    beneficiary of a partnership, corporation, limited liability company, or
13    estate or trust qualifying for an income tax credit as an owner of
14    agricultural assets under the Beginning Farmer Tax Credit Act shall be
15    equal to the partner's, shareholder's, member's, or beneficiary's portion
16    of the amount of tax credit distributed pursuant to subsection (6) of
17    section 77-5211.
18(5)(a) For all taxable years beginning on or after January 1, 2007,
19    and before January 1, 2009, under the Internal Revenue Code of 1986, as
20    amended, there shall be allowed to each partner, shareholder, member, or
21    beneficiary of a partnership, subchapter S corporation, limited liability
22    company, or estate or trust a nonrefundable credit against the income tax
23    imposed by the Nebraska Revenue Act of 1967 equal to fifty percent of the
24    partner's,      shareholder's,     member's,   or    beneficiary's       portion   of   the
25    amount of franchise tax paid to the state under sections 77-3801 to
26    77-3807 by a financial institution.
27(b) For all taxable years beginning on or after January 1, 2009,
28    under the Internal Revenue Code of 1986, as amended, there shall be
29    allowed    to   each   partner,    shareholder,      member,    or     beneficiary   of   a
30    partnership,      subchapter   S   corporation,     limited     liability    company,     or
31   estate or trust a nonrefundable credit against the income tax imposed by
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1    the Nebraska Revenue Act of 1967 equal to the partner's, shareholder's,
2    member's, or beneficiary's portion of the amount of franchise tax paid to
3    the state under sections 77-3801 to 77-3807 by a financial institution.
4(c) Each partner, shareholder, member, or beneficiary shall report
5   his or her share of the credit in the same manner and proportion as he or
6   she reports the partnership, subchapter S corporation, limited liability
7   company, or estate or trust income. If any partner, shareholder, member,
8   or beneficiary cannot fully utilize the credit for that year, the credit
9   may not be carried forward or back.
10(6) There shall be allowed to all individuals nonrefundable credits
11    against the income tax imposed by the Nebraska Revenue Act of 1967 as
12    provided in section 77-3604 and refundable credits against the income tax
13    imposed by the Nebraska Revenue Act of 1967 as provided in section
14    77-3605.
15(7)(a) For taxable years beginning or deemed to begin on or after
16   January 1, 2020, and before January 1, 2032, under the Internal Revenue
17   Code of 1986, as amended, a nonrefundable credit against the income tax
18    imposed    by   the   Nebraska   Revenue   Act   of   1967   in   the   amount   of   five
19    thousand dollars shall be allowed to any individual who purchases a
20    residence during the taxable year if such residence:
21(i) Is located within an area that has been declared an extremely
22    blighted area under section 18-2101.02;
23(ii) Is the individual's primary residence; and
24(iii) Was not purchased from a family member of the individual or a
25    family member of the individual's spouse.
26(b) The credit provided in this subsection shall be claimed for the
27    taxable year in which the residence is purchased. If the individual
28    cannot fully utilize the credit for such year, the credit may be carried
29    forward to subsequent taxable years until fully utilized.
30(c) No more than one credit may be claimed under this subsection
31   with respect to a single residence.
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1(d) The credit provided in this subsection shall be subject to
2    recapture by the Department of Revenue if the individual claiming the
3    credit sells or otherwise transfers the residence or quits using the
4    residence as his or her primary residence within five years after the end
5    of the taxable year in which the credit was claimed.
6(e)    For    purposes    of    this     subsection,       family    member       means    an
7    individual's     spouse,   child,    parent,       brother,     sister,    grandchild,        or
8    grandparent, whether by blood, marriage, or adoption.
9(8) There shall be allowed to all individuals refundable credits
10    against the income tax imposed by the Nebraska Revenue Act of 1967 as
11    provided in the Cast and Crew Nebraska Act, the Nebraska Biodiesel Tax
12    Credit   Act,    the   Nebraska    Higher    Blend    Tax     Credit    Act,    the    Nebraska
13    Property   Tax    Incentive   Act,    the        Relocation    Incentive       Act,    and    the
14    Renewable Chemical Production Tax Credit Act.
15(9)(a) For taxable years beginning or deemed to begin on or after
16    January 1, 2022, under the Internal Revenue Code of 1986, as amended, a
17    refundable credit against the income tax imposed by the Nebraska Revenue
18    Act of 1967 shall be allowed to the parent of a stillborn child if:
19(i) A fetal death certificate is filed pursuant to subsection (1) of
20    section 71-606 for such child;
21(ii) Such child had advanced to at least the twentieth week of
22    gestation; and
23(iii) Such child would have been a dependent of the individual
24    claiming the credit.
25(b) The amount of the credit shall be two thousand dollars.
26(c) The credit shall be allowed for the taxable year in which the
27    stillbirth occurred.
28(10) There shall be allowed to all individuals nonrefundable credits
29    against the income tax imposed by the Nebraska Revenue Act of 1967 as
30    provided in section 77-7204.
31(11) There shall be allowed to all individuals refundable credits
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1    against the income tax imposed by the Nebraska Revenue Act of 1967 as
2    provided in section 77-3157 and nonrefundable credits against the income
3   tax imposed by the Nebraska Revenue Act of 1967 as provided in sections
4   77-3156, 77-3158, and 77-3159.
5(12) For taxable years beginning or deemed to begin on or after
6    January 1, 2026, under the Internal Revenue Code of 1986, as amended, a
7    refundable credit against the income tax imposed by the Nebraska Revenue
8    Act of 1967 shall be allowed to any individual who received a premium
9    assistance credit under 26 U.S.C. 36B for the taxable year. The credit
10    shall be equal to the difference between the premium assistance credit
11    amount allowed by 26 U.S.C. 36B(b)(3)(A)(iii) as it existed prior to its
12    expiration and the premium assistance credit amount otherwise allowed by
13    26 U.S.C. 36B(b)(3)(A)(i) and (ii).
14Sec. 2.   Original section 77-2715.07, Revised Statutes Supplement,
15   2025, is repealed.
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