Important Information for Contractors Performing Construction Services in Nebraska
The Department of Labor and the Department of Revenue share a combined Contractor Registration Database (Database) which serves unique purposes of each of these agencies. The Nebraska Contractor Registration Act requires contractors and subcontractors doing business in Nebraska to register in this Database.
For the Department of Revenue, a contractor may choose how they want to pay sales and use tax on the building materials they annex into real property. There are three options available to the contractor for the taxation of building materials. Information guides explaining each of these options are available on the main Construction Contractor page. It is important to refer to these guides prior to registering in the Database. The option election is made in the registration process of the Database. The contractor registration information, including the contractor option elected, is displayed in the Database. Before performing any construction work in Nebraska, a contractor must be registered in the Database. All contractors making payments to another contractor (subcontractor) who is performing construction contractor services, and who is not registered in the Database are required to withhold 5% of all payments made to the nonregistered contractor (subcontractor). The 5% amount withheld is required to be remitted to the Department of Revenue. Those subcontractors that do not "perform construction contractor services" and that are just providing building materials or other services (such as suppliers, vendors, etc.) are not required to be in the Database. Registration in this Database is required to be renewed every 12 months.
The registration in the Database is in addition to the requirements to file for other applicable programs, including sales and use tax, income tax withholding, unemployment insurance, or worker’s compensation. Contact the appropriate agency for information on these requirements.