I S S U E 2 , 2 0 2 2 14 nebraska cpas RECENT NEBRASKA TAX AUDIT & APPEAL ISSUES S TAT E TA X B R I E F I N G BY NICK NIEMANN & MATT OTTEMANN, MCGRATH NORTH LAW FIRM Nebraska companies and individuals must confront a number of tax defense issues with the Nebraska Department of Revenue. Below is a selection of the issues we are seeing recently in audits and appeals. Business Buyers & Sellers The purchase or sale of a business is often a whirlwind for participants, as they must address a myriad of issues and make many decisions in a short period. The following are some of the Nebraska tax issues being addressed in audits and appeals when not handled in the planning stage: • Tax Exemption on Sale/Purchase: If the assets of a business are purchased, advisors should ensure the purchase is structured to take advantage of potential sales tax exemptions on the sale of business assets. • Incentive Transfers: Many businesses have Nebraska incentive projects. If not properly transferred, the buyer and/ or seller can lose a significant part of the expected incentives. • Capital Gain Exclusion Requirements: Nebraska has a capital gain exclusion for sales of stock by Nebraska resident shareholders, but that exclusion has several requirements that must be strictly adhered to in order to qualify. Companies Expanding in Nebraska Nebraska offers a number of meaningful incentives for companies that are expanding in Nebraska. This includes companies that are building a new facility, adding a new business or product line, or moving an existing business into Nebraska. Here are some of the audit and appeal issues we are seeing: • Qualified Business: Imagine Nebraska Act incentives are available for businesses engaged in qualifying business activities. It is critical that an incentive application properly
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