E-Verify. In 2022, the Department began to issue proposed assessments (60-day letters) to companies that have utilized Nebraska incentives and R&D credits, on the grounds that they failed to fully E-Verify every new employees’ work status. There are a number of legal grounds being overlooked in defending against the Department’s position, which we believe should be amended into existing protests or included in new protests. Property Tax Funding for Existing Property Tax Credit. In 2022, the Legislature locked in the funding for the existing Real Property Tax Credit, which was funded at $548 million in 2022 but was scheduled to be reduced to $375 million in 2024. The Legislature kept the $548 million funding for 2022, increased this to $560 million in 2023, and then increased the funding by up to 5% annually for later years. Additional Property Tax Credit. In 2022, the Legislature also created a second refundable credit to refund a part of the community college property taxes paid by Nebraska landowners. This credit would be funded with $50 million in 2022, but that would increase to $195 million for 2026. For later years, that credit would be increased up to 5% annually. Significant Failure to Claim These Credits. Unfortunately, a signif icant percentage of these credits are not claimed by Nebraska landowners. In September 2022, the state estimated that approximately 40% of the available credits were unclaimed— meaning the state was keeping about $200 million of the $500 million available. Isolated Mistake Is Not an Equalization Violation. There are normally two ways to challenge a property tax assessment: actual value and equalization. In Lancaster Cty. Bd. of Equalization v. Moser, the Mosers owned irrigated agricultural land in Lancaster County. The land was valued as irrigated land. However, the neighboring land was also irrigated, but that land was mistakenly not valued as irrigated. The Mosers thus challenged the value of their property for property tax purposes, claiming their land value was not equalized with their neighbor’s property. The Nebraska Supreme Court rejected this argument, finding that an isolated error in the valuation of one property need not be replicated through the equalization process. Sales Tax While the Legislature did not make signif icant changes to Nebraska’s sales tax statutes in 2022, there were a few sales and use tax court decisions of importance. Continued on page 22 21 nebraska society of cpas W W W . N E S C P A . O R G
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