Bill Looks to Fix Tax Relief “Glitch”

Last year, the Nebraska Legislature passed LB (Legislative Bill) 34, which front loads a 30 percent property tax credit that goes to the schools, rather than requiring taxpayers to claim it as a credit on their state income tax return. On Wednesday, February 26, 2025, Legislators heard testimony on a new bill intended to fix a “glitch” in LB 34. LB 34 was supposed to provide tax relief by not requiring taxpayers to claim the credit, thus ensuring that all taxpayers receive the credit. However, as a result of the wording of the bill, those who paid their 2023 property taxes in 2024 will not be able to claim the tax credit.Senator Tom Brewer (R-District 43) originally introduced LB 34, although is quick to point out that the version of LB 34 that passed is substantially different from his original proposal. Senator Brewer told FJN during a phone call on Wednesday, September 11, “If they would have left my bill alone as it was originally, it would have been pretty easy to defend, because none of this would have happened.”“Unfortunately, if you are the originator of the bill,” said Brewer, “you still get stuck with your name on it. Even if you didn’t agree with the bill, it’s still your bill.”Brewer described the missing year of tax credits as “a glitch in the bill.” To fix this problem, Senator Brian Hardin (R-48) introduced LB 81 this year. Last year, he voted for LB 34, although he later said he did not realize that it “unintentionally shortchanged” Nebraska taxpayers.Hardin said LB 81 would allow affected taxpayers to claim the refundable credit in taxable years beginning in 2024.James Greisch, representing the Nebraska Society of CPAs, Greater Omaha Chamber of Commerce and Lincoln Chamber of Commerce, was one of several who testified in support of the bill.“This is not just an accounting oversight,” said Greisch. It is a direct financial burden to farmers, ranchers, homeowners and small business owners across the state,” However, not all speakers were in support of the bill. Rebecca Firestone of OpenSky Policy Institute said the bill is “not feasible,” given the state’s projected $432 million revenue shortfall.The committee took no action on the bill.

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