Teresa Hoffman, policy communications associate, [email protected], 402.687.2100, ext. 1012; Rhea Landholm, brand marketing & communications manager, [email protected], 402.687.2100 ext. 1025
LYONS, NEBRASKA – A bill proposing changes to the Nebraska Advantage Microenterprise Tax Credit would better serve entrepreneurs striving to emerge strong from the economic consequences of COVID-19, said Johnathan Hladik, policy director for the Center for Rural Affairs.
Legislative Bill 366 was introduced Jan. 13 by Nebraska Sen. Tom Briese, District 41.
“Small business and economic development stakeholders across Nebraska have recommended a series of small, but meaningful, improvements to this important program,” Sen. Briese said. “Taken together, these proposals are designed to update the credit to current business conditions and remove unnecessary and burdensome restrictions.”
The Microenterprise Tax Credit, created in 2005, incentivizes microentrepreneurship by encouraging business investment and job creation. Currently, the program offers a 20% refundable tax credit over an applicant’s lifetime for eligible investments to business owners with five or fewer employees.
LB 366 would increase the maximum tax credit to $20,000 and allow family members to apply the credit to unrelated businesses. The bill also asks the Nebraska Department of Revenue to show more transparency when approving new applications. Finally, LB 366 would ensure the credit remains available to interested entrepreneurs through 2024.
Since its inception, the Microenterprise Tax Credit has provided benefits to individuals in 79—or 86%—of Nebraska’s 93 counties. The program is especially valuable now as many businesses have been forced to delay planned investment. Now, they can take advantage of the credit to make building improvements, equipment upgrades, and increase wages in 2021 and beyond.
Hladik commended Briese for introducing the bill and for his support for microentrepreneurship at a time when many small businesses have had to shutter or pause plans for future growth.
“From Omaha to Chadron, we have seen that microentrepreneurship is a successful strategy for growing and sustaining the local economy,” Hladik said. “With these proposed changes, the tax credit will be well positioned to help our small businesses recover by encouraging and facilitating strategic new investment.”
A hearing on the bill will be held by the Revenue Committee.
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