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LB 20_01
PREPARED BY: Kenneth Boggs
LB 20 DATE PREPARED: August 05, 2024
PHONE: 402-471-0050
Revision: 01
Revised to include agency responses. FISCAL NOTE
LEGISLATIVE FISCAL ANALYST ESTIMATE
ESTIMATE OF FISCAL IMPACT – STATE AGENCIES (See narrative for political subdivision estimates)
FY 2024-25 FY 2025-26
EXPENDITURES REVENUE EXPENDITURES REVENUE
GENERAL FUNDS $200,787 ($134,210,000) $125,700 ($25,236,000)
CASH FUNDS ($113,000,000) ($113,000,000)
FEDERAL FUNDS
OTHER FUNDS
TOTAL FUNDS $200,787 ($134,210,000) ($112,874,300) ($138,236,000)
Any Fiscal Notes received from state agencies and political subdivisions are attached following the Legislative Fiscal Analyst Estimate.
LB 20 introduces a new refundable tax credit for Nebraska residents who rent their primary residence. The tax credit is applicable to
taxable years starting on or after January 1, 2024. Eligibility is determined for any individual who rents a house, apartment, or other
residential unit in Nebraska, provided that the rented propert y serves as the individual's primary residence during the taxable year. The
credit calculation will be based on the greater of four percent of the total rent paid during the taxable year or two hundred dollars, with a
maximum limit of one thousand dollars.
The bill decreases the amount allocated under the Property Tax Credit Act, as follows:
• 2023: Minimum relief set at $360 million.
• 2024: Minimum relief set at $282 million.
• 2025: Minimum relief set at $317 million.
• 2026: Minimum relief set at $3 32 million.
• 2027: Minimum relief set at $347 million.
• 2028: Minimum relief set at $362 million
The Department of Revenue states that the impact of LB 20 requires a one- time programming fee of $65,087, payable to the OCIO, to
include an additional line on Form 1040N and update the NebFile online filing system. Additionally, the department will need to employ
two full-time Fiscal Compliance Analysts to implement the provisions of the bill.
The agency estimates the fiscal impact as follows:
General Fund
Revenue
General Fund
Expenditure
FY 2024-25 ($134,210,000) ($113,000,000)
FY 2025-26 ($138,236,000) ($113,000,000)
FY 2026-27 ($142,383,000) ($113,000,000)
There is no basis to disagree with the Department’s estimates of administrative costs or General Fund revenue loss related to the new
rental credit. However, aid pursuant to the Property Tax Credit Act is paid from the cash fund, funded by a Gen eral Fund transfer to the
cash fund. Estimated gain to the General Fund due to the reduction in the tran sfer to the Property Tax Credit Cash Fund is:
• FY2024- 25: $0
• FY2025- 26: $113 million
• FY2026- 27: $113 million
In FY26 and FY27, there would be a corresponding de crease in cash fund revenue and cash fund expenditures due to the lower
amounts pursuant to the Property Tax Credit Act. The re is no impact for FY2024-25 as the bill changes the minimum level of relief
under the act, and the amount transferred to the cash fund and appropriated for FY2024- 25 exceeds that amount.
LB 0020 Fiscal Note 2024
State Agency Estimate
State Agency Name: Department of Revenue Date Due LFO:
Approved by: James R. Kamm Date Prepared: LEAVE BLANK Phone: 471-5896
FY 2024-2025 FY 2025-2026 FY 2026-2027
Expenditures Revenue Expenditures Revenue Expenditures Revenue
General Funds ($112,799,213) ($134,210,000) ($112,874,300) ($138,236,000) ($112,874,300) ($142,383,000)
Cash Funds
Federal Funds
Other Funds
Total Funds ($112,799,213) ($134,210,000) ($112,874,300) ($138,236,000) ($112,874,300) ($142,383,000)
Major Objects of Expenditure
24-25 25-26 26-27 24-25 25-26 26-27
Class Code Classification Title FTE FTE FTE Expenditures Expenditures Expenditures
A21211 Fiscal Compliance Analyst 2.0 2.0 2.0 $94,500 $94,500 $94,500
Benefits…………………………………………………………………………………………………………. $31,200 $31,200 $31,200
Operating Costs…………………………………………………………………………………………………. $65,087
Travel……………………………………………………………………………………………………………
Capital Outlay…………………………………………………………………………………………………... $10,000
Capital Improvements…………………………………………………………………………………………...
Total……………………………………………………………………………………………………………. $200,787 $125,700 $125,700
LB 20 establishes a new refundable credit for rent and changes the minimum tax credit available under the
Property Tax Credit Act (Act).
For taxable years beginning on or after January 1, 2024, a new refundable tax credit for individuals renting a
house, apartment, or other residential unit in Nebraska for use as their primary residence. The credit is 4% of the
total of rent paid during the taxable year or $200 but not to exceed $1000.
LB 20 also reduced the Property Tax Credit Fund as follows:
• Tax year 2024, the minimum relief credit is reduced from $395,000,000 to $282,000,000;
• Tax year 2025, the minimum relief credit is reduced from $430,000,000 to $317,000,000;
• Tax year 2026, the minimum relief credit is reduced from $445,000,000 to $332,000,000;
• Tax year 2027, the minimum relief credit is reduced from $460,000,000 to $347,000,000; and
• Tax year 2028, the minimum relief credit is reduced from $475,000,000 to $362,000,000.
Changed “required under” to “provided in” if money is transferred or credited to the Property Tax Credit Cash
Fund pursuant to any other state law shall be added when determining the relief granted under the Act.
It is estimated that this bill will have the following impacts on the General Fund Revenue:
General Fund
Revenue
General Fund
Expenditure
FY 2024-25 ($134,210,000) ($113,000,000)
FY 2025-26 ($138,236,000) ($113,000,000)
FY 2026-27 ($142,383,000) ($113,000,000)
LB 0020 page 2 Fiscal Note 2024
LB 20 will require a one-time programming charge of $65,087 paid to the OCIO to add a line to Form 1040N as
well as to the NebFile online filing system. The department will need to hire two FTE Fiscal Compliance Analyst
to implement the bill.