Economic Development Tax Incentives - - Switching Between Nebraska Advantage Tiers. AN AGREEMENT UNDER THE NEBRASKA ADVANTAGE ACT, LB 312, CANNOT BE AMENDED TO SWITCH BETWEEN TIERS EXCEPT AS ALLOWED IN THIS RULING.
Advice has been requested as to whether a person who has signed an agreement under the Nebraska Advantage Act under one tier may request a change to another tier.
Under the Nebraska Advantage Act there are a significant number of differences in benefits, qualification requirements, allowable business activities, applicable time periods, and audit standards between the different tiers. Consequently, a project under one tier may not be an eligible project under a different tier. Therefore, only the following amendments will be allowed for applications under the Nebraska Advantage Act.
A Tier 2 agreement may be amended into a Tier 3 or Tier 5 agreement.
A Tier 4 agreement may be amended into a Tier 2, Tier 3, or Tier 5 agreement.
Under a Tier 4 agreement, the taxpayer will receive the Tier 2 benefits as soon as the taxpayer has met or exceeded the Tier 2 required levels. If the taxpayer never qualifies at the higher levels required for Tier 4 property tax benefits, or if the taxpayer never requests any property tax benefits by claiming an exemption with the county, the Tier 4 agreement will be treated as though it was a Tier 2 agreement without an amendment being necessary.
As a part of the amendment of an agreement, all benefits and time periods will be recomputed for the agreement as though the application was originally for the amended tier. Any benefits previously received that are not allowable under the amended agreement, must be repaid, with applicable interest, before the amended agreement will be signed.
Any application or agreement may be withdrawn and a new application filed at any time. The request to withdraw must include repayment of any benefits received for the project. The new application will be considered as though there had not been a previous application.
Mary Jane Egr
State Tax Commissioner
December 20, 2005