NE 01-16-2 Sales and Use Tax 2016-07-20

Is Nebraska Revenue Ruling 01-10-3 on the net metering of electricity still in effect?

Short answer: No -- it has been withdrawn. Revenue Ruling 01-16-2 (issued July 20, 2016) rescinds Revenue Ruling 01-10-3, 'Net Metering of Electricity' (issued August 4, 2010). The Department gives a specific reason: the rescission is 'a result of the enactment of LB 90, Laws 2013,' which changed the underlying law. For the current sales and use tax treatment of net-metered electricity (customer-generated power, such as from rooftop solar, credited against utility bills), rely on current Nebraska statutes and regulations reflecting LB 90 rather than the withdrawn 01-10-3.

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This page answers the general question as of 2016. Ezel answers yours, under current Nebraska tax law, with citations.

Disclaimer: This is an official Revenue Ruling of the Nebraska Department of Revenue, a guidance document stating the Department's interpretation of how Nebraska tax law applies. Each Nebraska guidance document carries the notice that it 'is advisory in nature but is binding on the Nebraska Department of Revenue until amended.' Unlike a private letter ruling, a Revenue Ruling is a general statement of Department policy rather than advice to a single taxpayer, but it can be amended, superseded, or made obsolete by a later ruling or a change in statute or regulation, many rulings in this series have been rescinded or superseded, so confirm it is still in effect before relying on it. Nebraska's local option sales and use taxes are administered by the Department, not self-collected by home-rule cities. This summary is informational only and is not legal or tax advice. Consult a licensed Nebraska tax professional about your situation.

About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.

View original ruling (PDF)

Plain-English summary

This is a housekeeping ruling. The Nebraska Department of Revenue rescinds an older sales and use tax ruling: Revenue Ruling 01-10-3, "Net Metering of Electricity," which had been issued August 4, 2010.

"Net metering" is the arrangement where a customer who generates their own electricity -- for example, from rooftop solar or a small wind system -- feeds surplus power back to the utility and receives a credit against their bill. The Department says it is withdrawing the old ruling "as a result of the enactment of LB 90, Laws 2013," meaning a 2013 legislative change altered the law the 2010 ruling was based on.

What this means for you

Customers and utilities involved in net metering

Do not rely on the withdrawn Revenue Ruling 01-10-3 for the sales and use tax treatment of net-metered electricity. Because the rescission was driven by LB 90 (2013), look to the current statutes and regulations as changed by that legislation, or seek a current determination.

Solar/renewable installers and advisors

If you advise customers on the tax treatment of on-site generation and net metering, treat the 2010 ruling as obsolete and work from the post-LB 90 legal framework.

Common questions

Q: What does Revenue Ruling 01-16-2 do?
A: It rescinds Revenue Ruling 01-10-3, "Net Metering of Electricity" (issued August 4, 2010).

Q: Why was 01-10-3 rescinded?
A: As a result of the enactment of LB 90, Laws 2013, which changed the underlying law.

Q: Can I still rely on 01-10-3?
A: No. Once rescinded, it can no longer be relied on; use current statutes and regulations reflecting LB 90 (2013).

Citations and references

Rescinds: Revenue Ruling 01-10-3, "Net Metering of Electricity," issued August 4, 2010.
Reason: enactment of LB 90, Laws 2013.

Source

Original ruling text

Revenue Ruling 01-16-2

Sales and Use Tax

Rescinds Revenue Ruling 01-10-3

July 20, 2016

Sales and Use Tax—Revenue Ruling Rescinded
This guidance document is advisory in nature but is binding on the Nebraska Department
of Revenue (Department) until amended. A guidance document does not include internal
procedural documents that only affect the internal operations of the Department and does
not impose additional requirements or penalties on regulated parties or include confidential
information or rules and regulations made in accordance with the Administrative Procedure
Act. If you believe that this guidance document imposes additional requirements or penalties
on regulated parties, you may request a review of the document.
This guidance document may change with updated information or added examples.
The Department recommends you do not print this document. Instead, sign up for the
subscription service at revenue.nebraska.gov to get updates on your topics of interest.
The following revenue ruling is hereby rescinded as a result of the enactment of LB 90,
Laws 2013:
01-10-3 Net Metering of Electricity, issued August 4, 2010.
APPROVED:

Tony Fulton
Tax Commissioner
July 20, 2016

Nebraska Department of Revenue, PO Box 94818, Lincoln, Nebraska 68509-4818

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