NE 29-05-9 Tax Incentives 2005-12-20

Can a taxpayer convert an application or agreement under the old LB 775 Employment and Investment Growth Act into the Nebraska Advantage Act (LB 312)?

Short answer: No. Revenue Ruling 29-05-9 holds that an application or agreement under the older Employment and Investment Growth Act (LB 775) cannot be converted into an application or agreement under the Nebraska Advantage Act (LB 312). The filing windows are mutually exclusive -- no LB 775 applications could be accepted after December 31, 2005, and no LB 312 applications could be filed until January 1, 2006 -- so it is not possible to convert an application from one program to the other. An LB 775 agreement likewise cannot be converted into an LB 312 agreement, whether or not the taxpayer has already received benefits, because each Act requires its own application, uses different eligibility criteria, and has different benefit periods; without an LB 312 application (which cannot be created by conversion), an LB 312 agreement's requirements cannot be met.

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This page answers the general question as of 2005. 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Ruling is a general statement of Department policy rather than advice to a single taxpayer, but it can be amended, superseded, or made obsolete by a later ruling or a change in statute or regulation, many rulings in this series have been rescinded or superseded, so confirm it is still in effect before relying on it.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

Nebraska ran two big business-incentive programs back to back. The older one was the Employment and Investment Growth Act (LB 775); its replacement was the Nebraska Advantage Act (LB 312). As LB 775 wound down and LB 312 started up, taxpayers asked the natural question: can I just convert my LB 775 application or agreement into an LB 312 one? This ruling answers: no.

Applications can't be converted — the windows don't overlap. The Legislature set mutually exclusive filing dates: no LB 775 applications could be accepted after December 31, 2005, and no LB 312 applications could be filed until January 1, 2006. Because the two windows never overlap, there's no way to move an application from one program to the other.

Agreements can't be converted either — even if you've taken benefits. An LB 775 agreement cannot become an LB 312 agreement, whether or not the taxpayer has already received benefits. Each Act:

requires its own application to be filed,
has different eligibility criteria, and
has different benefit time periods.

Since an LB 312 agreement's requirements can't be satisfied without an LB 312 application, and an LB 775 application can't be converted into one, an LB 775 agreement simply can't be converted into an LB 312 agreement.

What this means for you

Businesses that held an LB 775 (Employment and Investment Growth Act) deal

You cannot roll an LB 775 application or agreement over into the newer Nebraska Advantage Act. If you wanted LB 312 benefits, you needed to file a separate LB 312 application within its own window (on or after January 1, 2006) and meet LB 312's distinct criteria — your prior LB 775 status doesn't carry over.

Businesses comparing the two programs historically

Treat LB 775 and LB 312 as entirely separate regimes with non-overlapping application periods. A project's history under one program has no automatic standing under the other.

Common questions

Q: Can I convert my LB 775 application to an LB 312 application?
A: No. The filing windows are mutually exclusive — LB 775 applications ended December 31, 2005 and LB 312 applications could not be filed until January 1, 2006.

Q: I already have an LB 775 agreement. Can it become an LB 312 agreement?
A: No, whether or not you've received benefits. Each Act needs its own application and has different criteria and benefit periods.

Q: Does having received LB 775 benefits change the answer?
A: No. Prior receipt of benefits does not enable conversion.

Citations and references

This ruling interprets the interaction between the Employment and Investment Growth Act (LB 775) and the Nebraska Advantage Act (LB 312), relying on the Legislature's mutually exclusive application-filing dates rather than quoting a specific statutory section.

Source

Original ruling text

Revenue Ruling 29-05-9
Economic Development Tax Incentives
December 20, 2005
Economic Development Tax Incentives -- Conversion of Applications. AN APPLICATION OR
AN AGREEMENT UNDER THE EMPLOYMENT AND INVESTMENT GROWTH ACT, LB
775, CANNOT BE CONVERTED INTO AN APPLICATION OR AN AGREEMENT UNDER
THE NEBRASKA ADVANTAGE ACT, LB 312.
Advice has been requested whether an application or an agreement under the Employment and
Investment Growth Act, LB 775, can be converted into an application or agreement under the
Nebraska Advantage Act, LB 312.
An application under LB 775 cannot be converted into an application under LB 312. The dates
established by the Legislature for the filing of applications for LB 775 and LB 312 are mutually
exclusive. No applications for LB 775 can be accepted after December 31, 2005, and no applications
for LB 312 can be filed until January 1, 2006. Since the dates are mutually exclusive, it is not
possible to convert an application from one incentive program to the other.
An agreement under LB 775 cannot be converted into an agreement under LB 312, whether or not
the taxpayer has already received benefits. Each of the Acts requires an appropriate application to
be filed, has different criteria to determine eligibility for benefits, and has different time periods for
benefits. Since the requirements for an agreement under LB 312 cannot be satisfied without an LB
312 application and the LB 775 application cannot be converted, an LB 775 agreement cannot be
converted to an LB 312 agreement.
APPROVED:

Mary Jane Egr
State Tax Commissioner
December 20, 2005

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

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