Nebraska Employer Tax Credit for Employing Convicted Felons
Neb. Rev. Stat. § 77-27,240
LB 917, Operative for taxable years beginning on or after January 1, 2023.
LB 917 provides a nonrefundable credit for employers that employ an individual who has been convicted of a felony in Nebraska or any other state (eligible employee). The credit will equal 10% of the wages paid by the employer to the
eligible employee during the taxable year except:
- The credit is allowed only on the wages paid during the first 12 months of the eligible employee’s employment with the employer, and
- The total credit with respect to one eligible employee cannot exceed $20,000.
The nonrefundable income tax credit may be claimed on corporate, individual, or fiduciary income tax returns. Fiduciaries may distribute the credit to the beneficiaries. Pass through entities that elect to pay the tax can claim the credit but cannot distribute the credit.
The employer must apply for the nonrefundable tax credit by submitting an application to the DOR. The application will include:
- The number of eligible employees employed by the employer during the taxable year;
- The amount of wages paid to each eligible employee during the taxable year; and
- Any other information to verify the employer’s eligibility for the credit.
The DOR will consider applications in the order received each year until the total amount of approved credits reaches $5 million. If the employer qualifies for the nonrefundable tax credit, the DOR will approve the application and certify the amount of the approved credit to the employer.
Instructions to Upload Form
After you submit the Form ETC-A you will receive an e-mail confirmation from noreply@sf-notifications.com to the email address entered that shows the upload was successful. If you do not see an email in your inbox, please check your spam/trash/junk folder. The email confirmation will display the name of the uploaded file(s). Please verify that the correct file(s) are included in the list. If the correct file(s) aren’t uploaded, please upload the correct documentation on the DOR website using the same link you used to upload the Form ETC-A. DOR will also receive notification that the files were uploaded.
DOR will review your submission and contact you if additional information is needed. The e-mail confirmation lets you know that DOR received your filing, please do not contact DOR for a status update as all files will be reviewed in the order received. If the Form ETC-A has been properly completed, please allow 10 business days for DOR to complete the review of your Form ETC-A.
