(LINCOLN, NEB.) — The Nebraska Department of Revenue (DOR) is providing information on property tax relief changes resulting from a new credit through the passage of LB 34 (2024). The bill frontloads the credit of 30% of school district taxes paid automatically by reducing property tax statements instead of requiring the taxpayer to claim it as a refundable income tax credit. The total amount of the frontloaded relief is $750 million that will reduce 2024 property tax statements.
This credit is set to increase by a minimum of 3% each year and as the state’s economy grows, LB 34 includes a provision to direct even more funding to property tax relief.
Previously under LB 1107 (2020), approximately 45% of Nebraskans were not claiming the property tax credit when filing their income tax returns. Now, through LB 34, those taxpayers will experience upwards of 20% in direct property tax relief.
For those taxpayers who previously claimed those tax credits, LB 34 will continue to provide property tax relief, without the burden of filing a claim. Taxpayers will now receive the benefit much earlier in the process. The new frontloaded credit will appear on each taxpayer's 2024 property tax statement, which will be mailed in December 2024.
The frontloading of this credit only applies to school district taxes, so there is no change to the community college tax credit, which must still be claimed by taxpayers on their income tax return. This credit does still provide a 100% refund of community college taxes paid by the taxpayer.
Provided below is a comparative analysis considering prior law and LB 34 changes utilizing the average tax credit Nebraska property taxpayers would receive in each respective year:
